State of the Market: Pre-seed and Seed Valuations

Mike Cardamone
Dec 13, 2022
min read

Valuation data lags by months, and studies about Q3 valuations already feel out of date given how much late-stage valuations are coming down to be more in line with public comps.

With the market moving so quickly, it can be impossible to know what is fair in this market. So Forum Ventures partnered with Stonks to conduct a survey capturing data over the last two months from completed pre-seed and seed rounds. We surveyed over 80 VCs and captured data from 124 early-stage fundraising rounds in Q4 2022.

With this report, we aim to arm founders and funders with real-time information on how market conditions will affect their fundraising so that they can realize successful pre-seed and seed rounds.


Series A valuations have started to come down, and it appears that the big multi-stage funds are focusing their attention on Series A+ deals. Additionally, given the macro environment, the volume of capital flowing through syndicates and angel investors more broadly is likely to slow down significantly. These dynamics, combined with the expected onslaught of bad news across late-stage private tech companies over the next couple of quarters, suggest that valuations at seed will revert back to 2019 levels by Q2 of next year.

The pace is picking back up in terms of meetings and interesting opportunities, but the decision-making process is slower and more deliberate. There is a return to saner valuation asks and negotiations,
which is a necessary and ultimately positive trend for both founders and investors.

- Survey Respondent, Managing Director at New York-based fund

Key Findings

📉 58% of respondents believe seed valuations will go down in Q1 2023. 38% believe they will stay the same. Only 4% believe valuations will go up. VCs might be taking meetings, but the DD process will be slower and more deliberate.

💰 Traction and valuation seemed to be highly correlated, indicating that companies who can prove product-market fit, revenue generation, and customer acquisition will be more likely to secure funding. Companies with $250K+ in ARR on average were completed at 68% higher valuations than pre-revenue companies.

🧕 🙎‍♀️ The current market landscape seems to be disproportionately affecting underrepresented minorities, with only 25% of respondents having at least half of their founders that are minorities.


Download the full report here →


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