You\u2019ve probably seen lots of articles about X company raising Y amount of money in some kind of funding round or another. But what do the different types of funding rounds mean?<\/p>\n
Well, a funding round is anytime money is raised from one or more investors for a business. They\u2019re given a letter, such as A Round, B Round, C Round, etc. because each round follows another. The letter identifies which number of rounds they\u2019re on. For example, \u2018C Round\u2019 would mean the third round of funding a company has had. The type of funding round will also depend on the type of shares are being offered, such as ordinary or preferred shares.<\/p>\n
Let’s take a closer look at the types of rounds and what they mean\u00a0but note that thanks to equity crowdfunding, anyone can invest alongside angels and venture capitalists (VCs) at each stage…<\/p>\n
Pre-Seed\/Angel Funding \ud83d\udcb0<\/strong><\/p>\n Seed Funding \ud83d\udcb0<\/strong><\/p>\n The average valuation for a company raising a Seed round is between 15 million AED and 30 million AED.<\/em><\/p>\n Series A \ud83d\udcb0<\/strong><\/p>\n The average valuation for a company raising a Series A round is between 50 million AED to 65 million AED<\/em><\/p>\n Series B \ud83d\udcb0<\/strong><\/p>\n The average valuation for a company raising a Series B round is between 150 million and 300 million AED<\/em><\/p>\n Series C \ud83d\udcb0<\/strong><\/p>\n Valuation of Series C companies often falls between 500 million AED and 700 million AED, although it\u2019s possible for companies to be worth much more, especially with the recent explosion of \u201cunicorn\u201d startups.<\/p>\n Series D \ud83d\udcb0<\/strong><\/p>\n Many companies finish raising money with their Series C. However, there are a few reasons a company may choose to raise a Series D.<\/p>\n Positive Reasons \ud83d\udc4d\ud83c\udffc<\/p>\n Negative Reasons \ud83d\udc4e\ud83c\udffc<\/p>\n Series E or later\ud83d\udcb0<\/strong><\/p>\n If few companies make it to Series D, even fewer make it to a Series E or above. Companies that reach this point may be raising for many of the reasons listed in their previous series round: They\u2019ve failed to meet expectations; they want to stay private longer; or they need a little more help before going public.<\/p>\n Venture Round\ud83d\udcb0<\/strong><\/p>\n Support start-ups to land and expand their teams.<\/strong><\/p>\n Private Equity\ud83d\udcb0<\/strong><\/p>\n Growing established companies to challenge market leaders.<\/strong><\/p>\n\n
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