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Has the seed stage come back down to earth? It depends where you look


It is over a year since macroeconomic headwinds began wreaking havoc on venture capital. Late-stage startups were the first to feel the blow, but the impact continued to diminish as 2022 progressed.

Now, in 2023, it seems that the uncertainty has made its way into the startup phase – at least for some companies.

Several seed investors have told TechCrunch+ that they have seen a drop in reach for seed deals and that valuations have softened. But Q1 data from both PitchBook and Carta paint a slightly different picture: While Q1 was the slowest period for seed deals in 10 quarters, median and average deal sizes and median deal-pre-money valuations were higher compared to Q4 from 2022.

But there’s a problem with tracking deals in the early stages: the data is almost never complete because these numbers only include information about price rounds and not SAFEs. Since SAFEs seem to make up the majority, if not a significant portion, of these early-stage deals, we’re not getting the full picture.

So what actually happens?

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