Trends in Fundraising for Technology Startups

The real reason early-stage fundraising is harder than ever (it's not what VCs are telling you). "The market's tough right now." "Valuations need to reset." "We're being more selective." All true. All missing the point. VCs have $1.7 trillion in dry powder. The money's there. The problem? Founders are still pitching like it's 2021. 2021 pitches were about possibility. 2025 pitches need to be about proof. The 3 founders who just closed $8.2M with us didn't raise because the market got easier. They raised because they got smarter. Here's what actually changed: They stopped selling vision and started showing execution. 2021: "We'll be the Uber of X" 2025: "Here's 8 months of 15% MoM growth and exactly how we achieved it" They pitched operations, not optimism. 2021: "Our TAM is $50 billion" 2025: "Our CAC dropped 40% last quarter. Here's the spreadsheet showing how." They made their ask about acceleration, not survival. 2021: "We need 18 months runway" 2025: "This capital unlocks these 3 specific growth levers we've already validated" The founder who raised $3.8M? She came in with month-by-month burn projections and three different growth scenarios. Not revolutionary—just prepared. The $2.7M raise? He had his org chart planned through Series A, with realistic salary ranges for each role. Basic stuff that most founders still skip. The capital hasn't dried up. The patience has. VCs aren't waiting for potential anymore. They're funding execution. Your competition isn't other startups. It's the public markets offering 5% risk-free returns. Beat that with proof, not promises. The founders getting funded aren't complaining about market conditions. They're adapting to them. #Fundraising #VentureCapital #StartupFunding #MarketInsights #FidelmanCo

As part of my role at HearstLab, I regularly engage with investors, sit on early-stage boards, and meet with startup founders. Across these conversations, one thing is clear: the venture market in 2025 is lopsided—tight for many, but frothy for a few. Three key takeaways on startup investing in 2025: 🔹 Valuations are all over the place. AI-first and deep tech startups are commanding sky-high multiples (20–200x revenue!), while traditional SaaS companies are seeing more moderate valuations. Growth-stage SaaS multiples are typically in the 4x–8x range, but can stretch higher for capital-efficient, high-retention businesses. Consumer is even lower. If a startup isn’t demonstrating strong growth, operational efficiency, and execution, valuation multiples take a hit. 🔹 The bar has moved. “Pretty good” isn’t cutting it. Investors expect execution against plan, growth with capital efficiency, and a repeatable sales process with a strong pipeline. Without these, raising capital is an uphill battle. 🔹 Exit strategies are top of mind. Investors want to see realistic pathways to liquidity—whether through PE rollouts, market consolidation, or strategic buyouts. The days of funding growth at all costs are long gone. The Good News? 💰 There’s still capital. Strong companies with great founders and clear product-market fit are getting funded. 🚀 AI continues to drive excitement across industries, from enterprise software to compliance, fintech, and healthcare. 🙌 Investors are backing impact-driven businesses, even in a shifting political and economic climate. At HearstLab, we’re actively investing and always open to introductions and referrals. If you’re seeing similar (or different) trends, let’s discuss!👇

What VCs Are Looking for in 2025-2026: A New Playbook for Founders The fundraising landscape is evolving, and so are the metrics that VCs prioritize when evaluating startups. If you're a founder preparing to raise capital in 2025-2026, here’s what you need to focus on: 📌 Product-Market Fit – It’s no longer just about a great idea; VCs want proof that your product has strong demand. Metrics like customer traction, retention rates, and feedback are key indicators. 📌 Scalability – Growth is still the goal, but efficient growth is the new standard. Investors are asking: Can this business scale rapidly without burning excessive cash? Founders need a clear expansion roadmap. 📌 Team Experience & Capability – A strong team is a bigger differentiator than ever. VCs are backing founders with deep industry expertise, proven execution skills, and the ability to navigate uncertainty. 📌 Technological Differentiation – AI is now table stakes. The real question is: What makes your technology truly unique? Proprietary IP, breakthrough innovations, or novel applications of tech set companies apart. 📌 Exit Potential – VCs are paying closer attention to liquidity paths. Founders who understand their **potential exit strategies—M&A, IPO, or strategic partnerships—**will stand out. The bar is higher, but so is the opportunity. Founders who adapt to these new expectations will be best positioned to raise in this market. What trends are you seeing in fundraising? Let’s discuss in the comments! 👇