Recent headlines in venture capital highlight a trend toward larger investment rounds amidst rising valuations and mega funds. Smaller and more modest seed rounds are becoming less common, as confirmed by Crunchbase data on U.S. seed funding. From 2024 to 2025, deal counts and total funding for smaller seed rounds from $200,000 to under $5 million declined by roughly 20%, while the largest seed deals of $10 million and above grew significantly.
This bifurcation splits the market between elite AI startups attracting substantial Series A funding from major firms, and other companies facing tougher competition. In response, some seed funds are altering strategies to preserve more capital for promising startups and to invest at earlier stages, sometimes prior to product-market fit.
The share of seed deals under $5 million dropped from 93% in 2018 to 75% in 2025, while those above $10 million rose from 2% to 9%. Total U.S. seed funding reached $19.4 billion in 2025, largely driven by large rounds, including a record $2 billion seed round by Thinking Machines Lab. Outlier rounds over $50 million surged over 300% in 2025, reflecting AI’s influence on early-stage investment dynamics.
Seed funding is not declining but evolving, with larger rounds becoming the norm for top-tier startups, while smaller funds continue to play a vital role in nurturing emerging companies in a tough market environment.
