Series A Funding: How Much to Raise and What Investors Look For (2026)

The most common mistake founders make in Series A fundraising isn't the pitch deck - it's asking for the wrong amount of money.

Ask for too little, and you'll be back fundraising in 12 months, killing your momentum. Ask for too much, and you'll dilute unnecessarily while scaring off investors who question whether you can deploy that capital efficiently.

Most founders guess. The smart ones calculate.

Your Series A is the most critical fundraising round you'll do. It's where you prove your business model works at scale. Get the amount wrong, and you're either running out of runway or giving away too much of your company.

In this guide, I'll show you exactly how to calculate your Series A raise amount and what investors are actually evaluating in 2026. This is the same framework we use at IRC Partners when advising companies raising institutional capital.

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How Much Should You Raise in Your Series A? (The Formula)

The 18-24 Month Runway Rule

Your Series A should fund 18-24 months of operations. Not 12 months. Not 36 months. Here's why:

12 months is too short. You'll be fundraising again before you hit the milestones that matter for Series B. Investors know this. They'll pass because you haven't given yourself enough room to execute.

18-24 months is the sweet spot. Enough time to hit meaningful milestones, scale your team, and prove your model works. You're not rushed, and you're not sitting on idle capital.

30+ months is over-raising. You're taking unnecessary dilution for capital you won't deploy efficiently. Investors will question your judgment and capital discipline.

The Calculation Framework

Step 1: Calculate Your Monthly Burn Rate

Start with reality. What's your current monthly burn?

Formula: Revenue - Expenses = Monthly Burn

Example: $100K monthly revenue - $300K monthly expenses = $200K/month burn

Step 2: Project Growth Burn

You're not maintaining current burn. You're scaling. That means:

• Hiring engineers, sales reps, and marketers
• Expanding infrastructure and tools
• Entering new markets or verticals

Typical Series A burn acceleration: 2-3x your current burn by month 18.

Here's what that looks like:

• Months 1-6: $200K/month burn
• Months 7-12: $300K/month burn
• Months 13-18: $400K/month burn
• Average: $300K/month

Step 3: Add Buffer

Always add 20-25% buffer. Always.

Why? Because:

• Hiring takes longer than you think
• Revenue ramps slower than projected
• Markets change
• Unexpected expenses happen

The buffer isn't pessimism. It's realism.

Step 4: Calculate Total Raise

Formula: (Average Monthly Burn × 18-24 months) × 1.25 buffer

Example: ($300K × 20 months) × 1.25 = $7.5M Series A

Common Sizing Mistakes

Too Conservative:
"We only need $3M to get to profitability."

Problem: No buffer, no growth acceleration. You'll be fundraising again in 12 months from a position of weakness. Investors see through this.

Too Aggressive:
"We want $15M to dominate the market."

Problem: Massive dilution (25-30%+), and investors will question if you can deploy that capital efficiently. If you've never managed a $15M budget, why should they believe you can now?

The Right Approach:
"We need $7.5M to hit $10M ARR with 18 months of runway and buffer."

Clear milestones. Reasonable dilution (15-20%). Credible deployment plan.

Industry Benchmarks (2026)

Your raise should match industry norms unless you have a compelling reason to differ:

• B2B SaaS: $5-12M
• Consumer Tech: $8-15M
• Hardware/Deep Tech: $10-20M
• Fintech: $10-25M

If you're raising outside these ranges, you better have a damn good reason why.

What Series A Investors Actually Look For in 2026

Investors evaluate six core areas. Nail these, and you'll get term sheets. Miss one, and you're done.

1. Product-Market Fit (Proven, Not Promised)

Investors don't fund you to find product-market fit. That's what seed was for. By Series A, you need proof.

What they want to see:

• Repeatable sales process - not one-off wins from founder hustle
• Customer retention >90% annually - customers aren't leaving
• NPS score >50 - customers actually like you
• Customers renewing AND expanding - they're buying more over time

Red flags that kill deals:

• High churn (>5% monthly for B2B)
• No repeat purchase behavior
• Customers not referring others

If you can't show that customers are staying AND buying more, you don't have product-market fit yet. Series A investors won't fund you to figure it out.

2. Revenue Traction & Growth Rate

2026 benchmarks for B2B SaaS:

• Minimum ARR: $1-3M (depends on deal size)
• Growth rate: 3x year-over-year minimum
• Monthly growth: 15-20%+

Investors care about three things:

1. Revenue quality - Is it recurring or one-time?
2. Customer concentration - No single customer should be >20% of revenue
3. Growth trajectory - Is it accelerating or decelerating?

They'll use the Rule of 40:

Growth Rate % + Profit Margin % should equal 40+

Example: 100% growth + (-60% margin) = 40 ✓

If you're not hitting Rule of 40, you better have a clear path to get there.

3. Unit Economics That Work

This is where most deals die. Your unit economics need to work at scale, not just in theory.

CAC Payback Period:

How long does it take to recover customer acquisition cost?

• Target for B2B: <12 months
• Target for Consumer: <6 months

If you're at 18+ months, you're burning too much to acquire customers.

LTV:CAC Ratio:

Lifetime value vs acquisition cost.

• Minimum: 3:1
• Exceptional: 5:1+

If you're at 2:1 or lower, your business doesn't work at scale.

Gross Margins:

• B2B SaaS: 70-80%+
• Marketplace: 20-30%
• Hardware: 40-50%

If your unit economics don't work at $3M ARR, they won't work at $30M ARR. Investors know this. Don't try to convince them otherwise.

4. Founder-Market Fit & Team

Investors bet on people as much as products. They're asking: Why are YOU the right person to build this?

What they evaluate:

• Domain expertise - Did you live this problem?
• Technical capability - Can you actually build this?
• Sales ability - Can you close enterprise deals?

Team composition they want to see:

• Technical co-founder (CTO or VP Eng)
• Go-to-market leader (VP Sales or CMO)
• Domain expert (someone who lived the problem)

Red flags:

• Solo founder with no key hires
• Team with no industry experience
• Missing critical roles (no one who can actually sell)

5. Market Size & Timing

Investors need to believe:

• TAM (Total Addressable Market) is $1B+
• You can capture 5-10% in 7-10 years
• The market is growing, not shrinking
• Timing is right (not too early, not too late)

2026 hot markets:

• AI infrastructure & tooling
• Vertical SaaS (industry-specific solutions)
• Climate tech & sustainability
• Healthcare operations
• Fintech infrastructure

They're asking one question: "Can this be a $1B+ company?"

If the answer isn't clearly yes, they'll pass.

6. Capital Efficiency & Burn Multiple

The new metric investors obsess over in 2026:

Burn Multiple = Net Burn ÷ Net New ARR

• <1.0: Exceptional (adding $1 ARR for every $1 burned)
• 1.0-1.5: Good
• 1.5-2.0: Acceptable
• >2.0: Concerning (burning too much for growth achieved)

Example:

• Net burn: $200K/month = $2.4M/year
• Net new ARR: $2M
• Burn multiple: 1.2 ✓

If you burned $10M to get to $2M ARR, investors won't give you another $10M to repeat that performance.

The Series A Pitch: What Investors Need to Hear

Your pitch must answer these questions in this exact order:

1. What problem are you solving?

Be specific. "Businesses need better software" isn't a problem. "Healthcare operations teams waste 15 hours per week on manual scheduling, costing hospitals $2M annually" is a problem.

Quantify the pain. Show you deeply understand it.

2. How big is the opportunity?

Use the TAM/SAM/SOM framework:

• TAM: Total addressable market
• SAM: Serviceable addressable market
• SOM: Serviceable obtainable market

Show market growth rate. Explain why now - what changed to make this possible?

3. What's your solution?

Product demo or screenshots. Show, don't tell.

Key differentiation: What makes you 10x better, not 10% better?

Why is this hard to replicate? What's your moat?

4. What traction have you achieved?

Revenue growth chart (the hockey stick).

Customer logos if you're enterprise. Key metrics: retention, NPS, growth rate.

This is the most important slide. If your traction isn't strong, the rest doesn't matter.

5. How will you use this capital?

Be specific:

• Hiring plan: Exact roles you're hiring (5 engineers, 3 sales reps, 1 marketer)
• Go-to-market expansion: New regions, verticals, channels
• Product development: Specific features or platform improvements
• Expected milestones: What you'll achieve in 18-24 months

Vague answers like "grow the team and scale" won't cut it.

6. Why is your team uniquely positioned to win?

Founder backgrounds. Domain expertise. Previous successes. Advisory board.

Make it clear: we're the only team that can execute this.

7. What are you raising and what's the plan?

• Raise amount: $XM
• Valuation range: (if you're sharing)
• Timeline: Close in 6-8 weeks
• Who else is interested: Create FOMO without lying

Pitch Deck Structure (12-15 slides)

1. Cover (company name, tagline, contact)
2. Problem (the pain point)
3. Solution (your product)
4. Market size (TAM/SAM/SOM)
5. Product (demo/screenshots)
6. Traction (revenue, growth, metrics)
7. Business model (how you make money)
8. Go-to-market (how you acquire customers)
9. Competition (why you win)
10. Team (who's building this)
11. Financials (projections, unit economics)
12. The ask (raise amount, use of funds)
13. Appendix (additional metrics)

Common Pitch Mistakes

• Too much time on problem/solution, not enough on traction
• No clear ask (how much are you raising?)
• Unrealistic projections (10x growth with no credible plan)
• Ignoring competition ("we have no competitors" is a red flag)
• No urgency (why should they decide now?)

Series A Timeline: What to Expect in 2026

Here's the realistic timeline if you're only talking to qualified investors:

Weeks 1-2: Preparation

• Finalize pitch deck
• Update financial model
• Prepare data room
• Build investor target list (15-25 qualified investors)

Weeks 3-4: Initial Outreach

• Secure warm intros
• First meetings with investors
• Pitch to 10-15 investors

Weeks 5-6: Partner Meetings

• Deep dive sessions
• Meet full partnerships
• Due diligence begins

Weeks 7-8: Term Sheets

• Receive term sheets from 2-4 investors
• Negotiate terms
• Select lead investor

Weeks 9-10: Closing

• Legal documentation
• Final due diligence
• Wire transfer

Total: 8-10 weeks from first pitch to closed round.

Most founders take 4-6 months because they're pitching the wrong investors. At IRC Partners, we compress this to 6-8 weeks by only connecting you with pre-qualified institutional investors who match your stage, industry, and check size.

Red Flags That Kill Series A Deals

Investors will walk away immediately if they see:

1. Founder Conflict

Co-founders not aligned on vision. Equity disputes. One founder clearly checked out.

If your founding team isn't solid, nothing else matters.

2. Customer Concentration

One customer represents 50%+ of revenue. If they churn, you're done.

Investors need to see diversification. No single customer should be more than 20% of revenue.

3. Decelerating Growth

Growth rate slowing month-over-month. Sign of market saturation or competition.

It's nearly impossible to raise when your growth is declining. Fix that first.

4. Broken Unit Economics

• CAC payback >18 months
• LTV:CAC ratio <2:1
• Gross margins <50% for SaaS

If your unit economics don't work now, they won't work at scale.

5. Legal/IP Issues

Unclear IP ownership. Pending lawsuits. Regulatory compliance problems.

Clean this up before you start fundraising. It will kill deals in due diligence.

6. Unrealistic Projections

10x growth with no plan to get there. Projections that don't match current trajectory. No buffer for market changes.

Investors have seen thousands of projections. They know what's realistic.

7. Lack of Focus

Trying to serve too many markets. No clear ICP (Ideal Customer Profile). Product roadmap is scattered.

Focus wins. Trying to be everything to everyone loses.

8. Poor Communication

Can't explain the business clearly. Defensive about weaknesses. Slow to respond to due diligence requests.

Communication matters. If you can't articulate your business simply, investors assume you don't understand it.

9. Fundraising Desperation

2 months runway left. Already talked to 100+ investors. Willing to take any terms.

Desperation kills leverage. Start fundraising with 9-12 months runway, not 3 months.

Real Examples: Series A Raises That Worked

Example 1: $15M Series A (B2B SaaS)

Company: Vertical SaaS for construction operations

Metrics at raise:

• $2.5M ARR
• 200% YoY growth
• 95% net revenue retention
• $150K average deal size
• 18-month CAC payback

Why it worked:

Clear product-market fit in a massive, underserved market. Strong unit economics. Founder had 15 years in construction before building the product. Raised $15M to expand from residential to commercial construction.

Result: Hit $12M ARR within 18 months. Raised $45M Series B at 3x valuation.

Example 2: $25M Series A (Fintech Infrastructure)

Company: Payment infrastructure for embedded finance

Metrics at raise:

• $4M ARR
• 250% YoY growth
• Processing $500M annually
• 8-month CAC payback
• 6:1 LTV:CAC

Why it worked:

Massive TAM ($50B+ market). Exceptional unit economics. Technical co-founders from Stripe and Square. Clear path to $100M ARR.

Result: Hit $25M ARR within 20 months. Raised $80M Series B.

Example 3: $50M Series A (AI Infrastructure)

Company: AI model deployment platform for enterprises

Metrics at raise:

• $6M ARR
• 300% YoY growth
• Fortune 500 customers
• 10-month CAC payback
• 85% gross margins

Why it worked:

Perfect timing (2024-2025 AI boom). Enterprise customers with high ACVs ($250K+). Founders from Google AI and AWS. Raised $50M to scale go-to-market and expand internationally.

Result: Hit $30M ARR within 18 months. Raised $150M Series B.

Example 4: $277M Series A (Deep Tech)

Company: Autonomous vehicle technology for logistics

Metrics at raise:

• $8M revenue (mix of pilot contracts and licensing)
• 400% YoY growth
• Partnerships with 3 Fortune 100 logistics companies
• 50+ patents filed

Why it worked:

Massive market opportunity ($200B+ logistics market). Proprietary technology with clear IP moat. Proven pilot deployments. Raised $277M to scale manufacturing and commercial deployment.

Result: Deployed autonomous vehicles in 15 distribution centers within 24 months.

Your Series A Action Plan

Here's what to do before your next investor meeting:

This Week:

• Calculate your 18-24 month runway needs using the formula
• Document your unit economics (CAC, LTV, payback period, burn multiple)
• Build your investor target list (15-25 qualified investors only)

Next Week:

• Finalize your pitch deck (12-15 slides)
• Update your financial model with realistic projections
• Prepare your data room (financials, customer metrics, legal docs)

Following Weeks:

• Secure warm intros to qualified investors (weeks 1-2)
• First meetings: qualify them, don't just pitch (weeks 3-4)
• Partner meetings with serious investors (weeks 5-6)
• Set term sheet deadline (week 7)
• Compare term sheets and close (weeks 8-10)

Total timeline: 8-10 weeks to closed round if you only talk to qualified investors.

Final Thoughts

Your Series A is the most important fundraising round you'll do. It's where you prove your business model works and set yourself up for Series B and beyond.

The key decisions:

1. Raise enough for 18-24 months (with buffer)
2. Show investors you have product-market fit, not just a product
3. Prove unit economics work at scale
4. Only pitch qualified investors who match your stage and industry

Get these right, and you'll close your Series A in 6-8 weeks with multiple term sheets and better terms.

At IRC Partners, we help companies raise institutional capital from $5M to $2B. With 307,000+ investors in our network, we connect you with the 15-25 that actually match your profile - not just any investor, but the right investors for your stage, industry, and goals.

We work with 5-7 clients per quarter because we believe if a raise is worth doing, it's worth doing with precision and leverage.

Ready to raise your Series A? Visit investorreadycapital.com to learn more about our process.

Download: Get our free Series A Readiness Checklist [blocked] - the exact framework we use to qualify companies before they start fundraising.

FAQ

How much should I raise in a Series A?

Your Series A should fund 18-24 months of operations. Calculate: (Average Monthly Burn × 18-24 months) × 1.25 buffer. Typical B2B SaaS Series A ranges from $5-12M.

What do Series A investors look for?

Series A investors evaluate: 1) Product-market fit (90%+ retention), 2) Revenue traction ($1-3M ARR, 3x growth), 3) Unit economics (LTV:CAC >3:1), 4) Team strength, 5) Market size ($1B+ TAM), 6) Capital efficiency (burn multiple <1.5).

What revenue do you need for Series A?

For B2B SaaS, minimum $1-3M ARR with 3x year-over-year growth. Consumer companies may need higher revenue ($5M+) due to different unit economics.

How long does a Series A take to close?

With qualified investors, 6-8 weeks from first pitch to closed round. Most founders take 4-6 months because they pitch misaligned investors.

What is a good burn multiple for Series A?

A burn multiple under 1.5 is good. Under 1.0 is exceptional. Above 2.0 signals you're burning too much capital for the growth achieved.

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