Precursor VenturesA classic pre-seed and seed stage venture capital firm

Is the Startup Funding Model Broken? 📉

14 Aug 2026 · 1 min

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Series A investors once filtered for product-market fit across hundreds of seed companies. Now only five to ten startups per year show real impact, suggesting the funding model has fundamentally broken down and these stage labels no longer mean what they used to.

I think everything feels broken. Uh, I feel like pre-seed and Series A labels feel broken. Series A feels broken. I think it used to be that the goal of a Series A investor was to help take this very large mass of seed and pre-seed stage companies and anoint the ones that had product market fit and give them more capital and help them grow. And now it feels like we live in this weird world where there's only 5 to 10 companies that feels like matter every year.