DealLawyers.com Blog

Fenwick and Carta recently released their latest “Venture Beacon,” a periodic report on the state of the venture capital market. This one covers the first quarter of 2026, and this excerpt highlights some of the report’s key findings:

Venture fundraising activity continued to recover in 2025 and into Q1 2026. Total capital raised increased meaningfully from 2023 lows, continuing the broader recovery trend that began in 2024. Series D+ financings continued to represent a meaningful portion of total dollars invested, reflecting continued strength in later-stage financings.

Valuations continued trending upward across financing stages. Median Seed and Series A pre-money valuations reached record highs in 2025, while Series B, Series C, and Series D+ valuations continued rebounding from the declines experienced in 2022 and 2023. Year-over-year valuation growth remained positive across all major financing stages in both 2024 and 2025.

The gap between top-performing companies and the broader market widened. The spread between median and top-quartile companies expanded further in 2025. At the Seed stage, the gap between the 50th and 90th percentile valuations increased materially. Series A financings showed a similar trend, with the top 90th percentile valuations experiencing significant growth relative to 75th percentile and below.

The report also found that in an environment where fundraising conditions continued to stabilize, AI-related companies were the big winners, attracting a record 61% of all venture dollars raised during the first quarter. Hardware, crypto/web3, gaming, and AI-related companies enjoyed the highest valuations and largest median raises, while healthcare, biotech, consumer, and edtech companies generally came in at lower valuations and engaged in smaller fundraising rounds.

– John Jenkins