Carta says the venture comeback is real, but the invitations are more scarce
Carta’s Q4 2025 data is the most honest picture we have of where startup funding actually went last year. And it makes a surprisingly strong case for rethinking the priced round entirely.
I have a thing for good data, and Carta’s 2025 State of Private Markets report is exactly the kind of thing I clear my schedule for. They cover more than 50,000 venture-backed companies that have collectively raised over a trillion dollars in equity, so when they publish something this granular, it deserves more than a LinkedIn scroll.
The headline is genuinely good news. Total capital raised hit nearly $120 billion in 2025, up 17% from the year before. Q4 alone brought in $36.1 billion, the strongest single quarter since 2022. Down rounds fell below 14%, their lowest rate in three years. By almost every surface measure, the market that reset hard in 2022 has found its footing again.
But the composition underneath that headline is where things get interesting.
The numbers getting overlooked
Nearly half of all seed financings in 2025 were bridge rounds, meaning extensions of existing rounds rather than new ones. Companies are buying more time because the milestones needed to unlock a Series A have not yet arrived. This gets framed in most coverage as a sign of founder-friendly flexibility, and in some ways it is. But it also tells you something honest about the shape of the market: the bar between stages has risen considerably, and a lot of companies are doing the sensible thing by extending runway while they clear it. The time from seed to Series A now sits at a median of 2.1 years, up from 1.5 years five years ago. Series A to B takes 2.8 years on average, the longest interval on record. These are longer journeys with higher checkpoints, and founders who plan their capital accordingly are the ones navigating it well.
The AI concentration data is significant and worth being clear-eyed about if you are building outside of it. At Series E, AI companies commanded valuations 193% higher than non-AI peers, and captured 70% of all capital at that stage. A third of all investment from Series A through E went to AI companies. This is not a rising tide lifting all boats. It is a very focused beam, and most of the market is not standing in it.
The part that almost nobody seems to be discussing, and I find it the most useful data point in the entire report, is what happens to that AI premium at the seed stage; it nearly disappears. The gap, which reaches 193% by Series E, is close to zero at the beginning. The premium is being assigned as companies demonstrate traction and revenue, not handed out at inception because a founder put AI in their deck. Which is actually healthy, and also a useful signal for anyone trying to read where genuine value is being created versus where excitement is running ahead of evidence.
What this has to do with how you raise
About eleven years ago I was co-founder of an ad tech company, and raising money meant institutional meetings, lawyers, and more process than product. We needed millions up front just to have basic technology to compete. The priced round was not really a choice; it was a structural requirement of the moment. You absorbed the dilution, handed over more control than you felt comfortable with, and assumed this was simply the cost of building something real.
That assumption no longer holds for most founders, and the Carta data makes the case more clearly than I could from personal experience alone.
At FOMO.ai, every dollar we have raised came through SAFE notes with a post-money valuation cap. We started at a $7.5 million cap and raised it as we hit milestones and de-risked the business, moving to $12.5 million, then $15 million, then $20 million. We generated revenue within 60 days of launching. The cap table stayed clean, showing only the founders and a small cluster of core team members, and when institutional investors eventually came around, that cleanliness was the first thing they noticed. It is nearly impossible to maintain once you go down the priced round path early.
Read: Founders! Are You Sure You Need a Priced Round?
The short version is this: the post-money SAFE structure meant our investors were not diluting each other across multiple rounds, our legal overhead stayed close to nothing at the moment when time and money were most precious, and we kept control of the timing of any conversion rather than surrendering it to a forced date.
What I see in the Carta data is a market that has become very good at concentrating capital into a smaller number of larger bets, while the number of companies moving cleanly through the traditional Series A, B, C path keeps compressing. The founders doing well inside this environment are not necessarily the ones grinding through the old playbook. Many of them are the ones who figured out earlier that the priced round is often a solution to a problem that no longer exists in the form it once did, at least for companies whose ambition and capital needs sit somewhere south of the unicorn track.
If your total capital need is several million rather than tens of millions, if you are building toward a strong acquisition or exit rather than a public offering, if scale is not genuinely do-or-die in your market, then the dilution and control you hand over in a traditional priced round is a real cost with no guaranteed corresponding benefit. The Carta data shows the market bifurcating sharply between the companies that genuinely need that path and the ones that simply assumed they did because everyone around them was doing it and celebrating it online.
The comeback is real. The numbers prove it. But the invitation list is considerably shorter than the headline suggests, and the path that actually gets companies funded increasingly looks different from the one most founders are still being told to follow. That gap is worth understanding before you decide which road you are on.
Dax is the Co-Founder & CEO @ FOMO.ai, and the author of 84Futures.com.