"Founders must prove to VCs they have more than just traction; they need a distribution advantage. Investors are digging deeper into repeatable sales engines, proprietary workflow/processes and deep subject matter expertise that holds up against the 'capital arms race'. VCs no longer care about who's first to market with a flashy demo. They want to know who's building something that can last, earn trust, and scale long-term."
"At the earliest stages, especially in AI application software, I do expect fewer mega seed rounds given intense competition and capital already deployed across many categories. Founders will need to stand out with unique distribution channels or perspectives, not just by relying on a large market opportunity and strong backgrounds. Capital moats have already formed around crowded sectors. At the Series-A and B stages, top-quartile rounds will require clear evidence of explosive momentum."
Raising in 2025 and beyond requires a shift from visionary positioning to being battle-tested with demonstrable, repeatable commercial motion. Investors are wary of pilot purgatory where enterprises test AI without buying, so founders must show distribution advantages, proprietary workflows, and deep subject-matter expertise that withstands competitive capital. Flashy demos no longer suffice; durable trust and scalable revenue models matter. Early-stage AI companies should expect fewer mega seed rounds due to crowded capital deployment. Series A and B financings will demand evidence of explosive momentum and increasing scrutiny on sustainability of revenue.
Read at TechCrunch
Unable to calculate read time
Collection
[
|
...
]