What Seed Looks Like Now: Notes from Carta’s “State of Seed”

DURHAM, N.C. — January 2026

Quick Take

Seed is still active, but it’s leaner, slower, and more distributed. A few founder‑level implications jump out. Sources: State of Seed: Winter 2025 (Carta), Peter Walker (Carta) on X, SAFE background: YC post‑money SAFE primer. Context: Peter Walker spoke at our Venture Connect conference in 2025; you can read the recap here.

What I’m seeing in the Data

• The number of Solo founders is up, but they capture a smaller share of seed equity dollars. If you’re solo, be realistic about fundraising odds; consider bootstrapping or non‑VC capital.
• Co‑founder risk is non‑trivial. Roughly a quarter of two‑founder teams lose a founder by year four. Get vesting/separation/IP clean early to protect the company.
• SAFEs dominate at pre‑seed. Convertible notes skew to biotech/energy. If you’re new to SAFEs, start with the YC primer.
• More dollars, fewer deals. Treat 2021 as the outlier, not the baseline.
• Time between rounds has stretched (~2.7 years). Plan runway for 24-30+ months; sequence milestones accordingly.
• AI is horizontal. Don’t pitch “AI as a sector.” Lead with problem/market; show AI as leverage.
• Typical seed dilution ≈20%. This may be your priciest capital—model ownership and follow‑on now; don’t regret it later. See Bill Spruill’s post here for more on that.
• Regional valuation spread is real. SF/NYC are top deciles and have higher valuations. Know national vs. local benchmarks before you price.
• Early hiring is delayed. First three hires come much later than a few years ago—partly AI leverage, partly capital discipline.
• Teams are leaner at each stage. Efficiency is the game; investors are underwriting to durability.

Peter Walker in conversation with Bill Spruill at our Venture Connect conference in 2025; you can read the recap here.

Some helpful resources:

• Get in touch with our Connect to Capital team Hunter Young, Head of Capital Yash Mehta, Capital Lead
• Hunter Young, Head of Capital
• Yash Mehta, Capital Lead
• Read Scot Wingo’s post on Triangle Startup Venture Funding Trends and Analysis

Operator Takeaways

• Extend your cash plan. Build to default‑alive or a credible path within 24-30 months.
• Milestone design matters. Tie spend to proof points that will impact the price in the next round.
• Paperwork first. Founder terms, IP assignment, equity splits—cheap to fix early, costly later.
• Be location‑aware. Calibrate valuation and round size to your geography.
• Use AI to delay hiring without stalling progress; structure organization so you can show efficiency.

More from Carta

Download Carta’s State of Seed report to get the insights you need to fundraise with confidence.