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🌱 🔄 The Evolution of Seed Stage

The venture capital ecosystem has long thrived on predictability. For decades, seed-only and multi-stage firms operated within clearly defined boundaries, each playing a complementary role in the startup funding landscape. Companies would progress through funding stages with remarkable consistency, with Series A graduation rates stabilizing between 30-50%.

This comfortable rhythm represented a delicate balance. Pre-seed and seed-stage firms would do the critical zero-to-one work, identifying and nurturing nascent potential. Multi-stage firms would then step in at Series A, supporting companies that had demonstrated early product-market fit and promising growth trajectories.

However, the current landscape tells a different story. The era of zero interest rate policy (ZIRP) dramatically inflated these graduation rates, creating an unsustainable bubble. More critically, multi-stage firms have permanently altered the seed investing ecosystem. What was once a specialized domain now represents a battleground where large funds compete directly with dedicated seed investors.

Today's multi-stage firms have developed sophisticated seed investing programs. They've built dedicated seed funds, developed specialized teams, and created comprehensive networks that make their previous separation from seed investing seem quaint. These firms are no longer occasional visitors to the seed stage; they are permanent residents.

Seed-only firms can no longer rely on historical operating models. They must reimagine their value proposition in a market where large, well-capitalized funds can write larger checks and offer more comprehensive support. The comfortable rhythms of the past have been irrevocably disrupted.

This doesn't mean seed-only firms are obsolete. Instead, they must evolve. They need to identify unique value propositions that multi-stage funds cannot easily replicate. This might mean deeper sector specialization, more hands-on founder support, or developing expertise in emerging technology domains that larger funds haven't yet mastered.

For Investors =================================

Discover a variety of venture opportunities in promising startups, experienced venture funds, and a broad-scope approach to accessing the upside of AI innovation with Ignite’s fund-of-funds. Fill out this quick form to share your preferences, and we'll connect you with ideal opportunities.

Bay Area Startups Secured Over $1.72B

Funding activity continue unabated in the first week of December, with $1.72B to 31 companies. After November's $12.6B and October's $18.8B in fundings, we're expecting a slowdown in December as the holidays approach. December's first week of $1.72B already exceeds the $1.5B of December 2023's full month. Here's a view of the highs and lows of fundings in 2024 – overall, the 2024 YTD of $75B already exceeds the full year of 2023 and that of 2022.

With the end of the year in sight, we wanted to take a look back at the 2024 SV IPOs and how they have fared. The smattering of tech companies that did dip their toes into the IPO waters are doing surprisingly well, for the most part. Biotech did not fare as well - although Septerna is up, other SV biotech IPOs are not. 

• October    Septerna................. up 39.94%

• October   Ceribell................... up 66.35%

• September BioAge Labs............ up 2.06%

• June      Alumis..................... down 46.13%

• May      Silvaco Group.........   down 57.58%

• April      Rubrik..................... up 67.69%

• March     Reddit .................... up 350.26%

• March     Astera Labs............. up 218.56%

• February   Metagenomi........... down 87.67%

• February   Kyverna Tx............   down 78.86%

• February   Alto Neurosciences.  down 75.63%

Follow LinkSV on LinkedIn to stay on top of Bay Area startup fundings, exits, executive & investor activity.

Early Stage:

• HappyRobot closed a $15M Series A, a leading provider of agentic AI for logistics, empowering teams to manage communication at scale and redefining the economics of the industry.

• Union Labs closed a $12M Series A, a hyper-efficient interoperability protocol. Union connects all blockchains and rollups, across any ecosystem.

• System Two Security closed a $7M Seed, bringing a new level of AI innovation to detection teams facing an increasingly complex threat landscape.

• Amae Health closed a $6M Series A, a mental wellness clinic that provides care for people with severe mental illness.

• Across AI closed a $5.8M Seed, an Agentic AI startup developing technology to reason and leverage enterprise data to generate contextually accurate and verifiable output for enterprise workflows, starting with B2B sales.

Growth Stage:

• Nuvig Therapeutics closed a $161M Series B, advancing an innovative and transformational pipeline of novel immune therapeutics for chronic inflammatory and autoimmune diseases.

• Heirloom closed a $150M Series B, our technology enhances natural processes to help minerals absorb CO2 from ambient air in days rather than years.

• Maze Therapeutics closed a $115M Series D, harnessing the power of human genetics to develop novel, small molecule precision medicines for patients living with renal, cardiovascular and related metabolic diseases, including obesity.

• Axiado closed a $60M Series C a leading hardware-anchored platform security solutions company deploying a novel, AI-driven approach to platform security against ransomware, supply chain, side-channel and other cyberattacks.

• Yurts closed a $40M Series B, delivers secure, production-ready AI solutions designed to transform mission-critical workflows in defense, government, and enterprise environments.

Trustme.ai delivers a cutting-edge platform that ensures security, productivity, and financial governance across the software development lifecycle (SDLC). By combining AI-powered insights, advanced security solutions, and cost optimization TrustMe.ai empowers organizations to develop, deploy, and manage secure, compliant software with confidence.

Key Features:

• Agents

  • Prioritize vulnerabilities with 20+ built-in probes for servers and endpoints.

  • Detect code quality issues early with SAST, SCA, IaC, and code quality scanners.

• Improved Security Posture

  • Reduces security breach risks by up to 70%.

  • Continuous scanning detects vulnerabilities early in the SDLC.

• Better Financial Governance

  • Reduces software overspending, typically 25% above budget.

  • Quantifies the financial impact of risks, ensuring cost control.

Around The Valley

PITCHFORCE // Palo Alto

With over 30 startups and 25+ investors, the event struck the perfect balance of energy and intimacy. It was all about quality—quality conversations with exceptional founders. Startups had the rare chance to pitch 1-on-1 with investors, receiving invaluable feedback to refine their presentations on the spot. A huge shoutout to Max Shapiro and the team for organizing such a seamless and impactful event. Your hard work made it all happen!

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