Startup Fundraising: Round Sizes, Dilution and Term Sheets
This guide is for founders planning a raise, from pre-seed through Series B. It shows typical round sizes and dilution, how SAFEs and notes work, which term sheet clauses to push back on, and how long the process really takes.
What's in the guide
- Typical 2026 rounds by stage: raise, post-money valuation, dilution and who leads
- SAFEs and convertible notes: valuation cap, discount, interest, maturity and conversion triggers
- Term sheet basics, preferred vs. common stock, and eight "dirty" terms to watch
- Cap table and dilution examples, from founding through Series B
- An 18-week fundraising process, from prep and target list to term sheet, diligence and close
- A 10-slide pitch outline and a data room checklist
- Employee option pools, ISOs vs. NSOs, and standard vesting
- Debt and non-dilutive options: venture debt, SBA loans, SBIR/STTR grants and crowdfunding limits
Questions this guide answers
How much dilution is typical in a seed round?
Using Carta medians for software rounds in July 2026, the guide shows a $4.1M seed at a $24M post-money, or about 17% dilution. Series A is $14.4M at $80M post (about 18%), and Series B is $25M at $191M post (about 13%).
What is the difference between a SAFE and a convertible note?
A SAFE has no interest or maturity date and converts at the next priced round. A convertible note is debt, often with 4% to 8% interest, and must be repaid or converted if no round happens by maturity. About 93% of pre-seed rounds now use SAFEs.
How long does it take to raise a round?
The guide lays out an 18-week process and says to plan for three to six months. Start with at least six months of runway, and aim for 12 to 18+ months of runway after close.
What term sheet clauses should founders avoid?
The guide flags excessive liquidation preferences, participating preferred, full-ratchet anti-dilution, pay-to-play, founder vesting resets, investor-friendly drag-along, mandatory redemption and pre-money option pool carve-outs.
How big should the employee option pool be?
The guide puts a typical pool at 10% to 20% of equity, with standard vesting of four years and a one-year cliff.
How Strativ helps
Raising money is where Strativ's Wall Street experience matters most. Mark Sue spent his Wall Street career as a Managing Director at RBC Capital Markets in equity research, IPOs and M&A, and Strativ clients have raised more than $500M. We help founders size the round, build the model and data room, run a tight process and negotiate terms with their counsel.
Request the full guide for the complete one-page reference, or book a call to talk through your situation.
