Startups Funding Rounds: Early Stage to Series A, B & C

You’ve probably read or heard something about a company launching their new funding series before. Maybe you’ve seen something in the news about funding rounds for startups. In this article, we’ll explain a little more about investor rounds and how startup funding rounds work. We’ll also go over examples of companies who’ve achieved success in different funding rounds. Funding announcements are valuable PR content pieces, that’s why it’s critical to understand the role of public relations in startup funding rounds. Before we can delve into how PR helps you gain investors and venture funding, we need to know at which stage of the funding series to reach external investors.

published: August 31, 2021
updated: August 12, 2022

What is startup investment?

Funding rounds are exciting news items for startups and tech companies alike. Not only do they mean new capital gain to fund business growth ventures, but they also provide opportunities to create media exposure and added publicity.

Before we get into the details of funding rounds and how PR plays an essential part in funding announcements, let’s define startup investment. When starting a new company, chances are you’ll need external investments to develop your business idea.

The funding round meaning points to the rounds of funding that startups go through to raise capital. The capital you need to launch and grow your business is termed ‘startup funding’. Initial funding likely comes from the founder’s personal investments, friends or family. Venture capitalists also invest when they are convinced of long-term business growth and profit gain.

Startup capital is usually referred to as ‘seed money’ that’s secured from investments or bank loans to get a new business up and running. What you do with the newly acquired capital is up to the nature of your business development.

During the funding series, new opportunities and new goals will arise. Accordingly, funding will be used to scale the business in some or other way.

For example, the investments from venture capital rounds can be used for product development, launching a service or to kickstart marketing campaigns. If the initial startup investment was successful, a series of funding rounds will follow. These funds will later be used to scale the business.

StartupVenture capitalists invest in startups by exchanging capital for equity. This means they buy a percentage of company ownership and future rights to potential profits of the startup. In this, investors are creating an investment partnership with the startup.

Essentially, startup investors are buying a piece or share of the company with their investments. Remember, the startup funds you gain from investors are not the same as donations. For example, venture capitalists want equity in exchange for their investments, namely, a percentage of ownership in the startup and rights to the potential future profits.

There are many different funding sources where investments in your company can come from. The important thing to remember is that you have to prove the success of your business ventures to investors, throughout the series of funding rounds.

Along the way, you’ll meet new challenges and goals to reach, all to prove to investors that your startup is worthy of their capital and that financial growth is maintainable. Without startup investment, you’re going to have a hard time to survive in business.

Startup investment refers to the capital the business needs to turn an idea into a working business model. After gaining seed money, the business will continue to grow and enter new startup funding rounds.

What are funding rounds?

After the success of an initial startup investment, the funding series continues. We define funding rounds as a series of investments that raise capital for the company. As the startup grows and scales up, each funding round is another stepping stone in the process of establishing a prosperous business.

Note that it’s ‘funding rounds’ not ‘funding round’. For most startups, funding is not a once off event. You work your way through multiple rounds, each building from the previous to reach new business goals or a milestone.

In between funding rounds, the startup continues to work on the improvement of the business. For example, increasing sales, adding team members and growing their market position. If the company’s valuation has increased enough to justify seeking additional funds, a new funding round can begin.

A specific timeframe for the funding round will be determined by founders and existing investors. A specific purpose for the round will also be determined and the terms between investors and founders will be set.

Many entrepreneurs and small businesses make the mistake of rushing the funding round. The successful completion of a specific stage in the funding series can take up to a year. Many new starter think they can rush it and complete the stage within three months, usually this results in short term success and, in most cases, investors’ funds are mismanaged.

There are multiple rounds of startup funding. A business passes through each round in order to gain investments that can be used to grow, expand or scale the company. The goal is to get investors involved so that the company can use the added capital to generate additional revenue streams and propel the company’s success within the market.

How startup funding works

The basic idea behind startup funding rounds is that equity is continuously split, like a pie. When you start, your pie is really small. You alone have a full, but very small pie. However, as your business begins to receive investments from outside, the pie gets bigger.

As you move through the series of funding rounds, more investors take a slice of the pie (their portion of equity, based on their investment). At the same time, the pie keeps increasing in size, so even if more slices are taken, the value of the slice increases.

It’s important that you only take investments when needed. Yes, dividing your pie means that the business grows with every investment, but you give away a piece of control with every slice. You have to make sure that you trust and respect your investors and build a healthy business relationship with them.

The typical seed round and venture capital rounds are based on the principle that equity is continuously split. Even though your percentage of shares is continuously divided, you gain a higher value on your slice of the pie.

Early stage funding rounds

Building a startup is no easy task. There are many additional business aspekts to consider, in addition to gaining business capital. When first introducing your startup, finding the initial capital should receive thorough planning.

It’s important to understand the different rounds of funding, so that you know what to expect from investors and at which stage you engage different types of investors. The early stages are critical, as these set you up for continuous success and business growth.



In the startup’s early stages, funding is usually gathered informally. Pre-seed funding is at the very beginning of the startup’s launch. Founders start by investing their own money and usually seek contributions from friends and family.

Getting the idea off the ground is the hardest part, as it takes the most work with the littlest investments. During the pre-seed stage, the company is still in the market research stage. The business model is still being developed, thus, investments are still high risk.

Since there’s still little proof of profitability, it is very rare to receive funding from venture capitalists or banks at this stage.

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Once the pre-seed funding round is closed, the typical seed round can start. Angel investors, being high-net-worth individuals who provide financial support, usually step in before most investors believe in the success of the startup.

Seed funding occurs before the startup becomes operational. In this stage, funds are used to develop the business idea and to perfect the business operations. The main idea behind seed funds is to have capital that can support the refinement of the startup’s main purpose, before pitching to high-stake investors.

Funding from angel investors often come with a high return rate, but it is far risky than a bank loan or debt that you have to pay back.

Since there’s still little ROI data to share with investors, PR for seed funding will focus on the story behind the brand and the value-adding benefit of the company. PR will strongly motivate why the company is viable and a market necessity.

Once a startup makes it past the seed funding rounds, the risks start to decrease and investments can have great payoffs if the company continues to grow successfully.


Series A

At this point, the business should be developed to the point of having an actual business model that is sure to bring about swift profit. Startups, that make it to this phase of funding, have trustworthy data and transparent research that proves that a high return on investment (ROI) will be secured.

Series A funding requires a actual business strategy that supports the case that investments will result in long-term growth. Investors are interested in the data and statistics that shows the potential of the startup’s continuity, more importantly, the profitability.

At this stage, venture capital financing can begin. Similar to seed funding, series A funding is equity based and secures financing by selling company shares to investors. A series A funding round press release is focused on attracting these investors, by showcasing the company’s ability to create a positive revenue stream and continued growth opportunities.

Before the company starts generating revenue, investments are based on the startup’s research and statistical chances of success within the market. The company is still a high risk investment and will have to work hard to convince investors that their business model will generate ROI.

Late stage funding rounds

Any round of funding is as important as the previous one, no matter the stage of funding you’re in. Funding means that you’re generating interest in your business, in this, you’re working to reinforce market validation.


Series B

With the development stages fully complete, funding round B indicates business growth and demonstrates stable revenues. At this stage, startups are growing and are continuing to build from their financial sources.

Series B is a transition phase, the startup is now entering the period where they become an established company. Building a reputable brand presence now becomes a priority. As companies have proven their success at this stage, investment is more low-risk and investors can be comfortable providing larger amounts of financing.


Series C

Series C is considered late-stage funding. This funding round is entered with the purpose to continue business expansions at a higher level. Reaching this funding round is an indication that the startup is highly successful and has secured a solid economic value.

You have to be highly successful to make it this far. Due to the demonstrated success of companies in this round, groups such as hedge funds and investment banks will be looking to get involved in what is now a low-risk investment.

These large investments are great for PR as they demonstrate solid credibility. At this stage, companies can also begin to plan brand acquisitions and additional market expansions.


Series D

Depending on the size of your company and the industry you’re in, additional funding rounds could be pursued. What you plan on using the funds for will also influence the number of funding rounds you go through.

From series C and onward, investors are looking for low-risk companies to invest in. It’s all about scaling, funds are used to expand the company’s market presence and to reach an even better market position.

When the later funding stages are reached, companies are likely preparing their Initial Public Offering (IPO). This is when a private company offers their first group of shares into the stock market. However, it takes years before a private company reaches the point of going public.

The complexity in going public is that you now not only have to manage investors, but shareholders as well. So if you wish to keep majority ownership of your company, it’s recommended to stay private and to keep funding rounds to a minimum.


Media training

From series D and onwards, PR can focus on the top tier publications during funding press releases. The company has proven their success and can focus on new market opportunities that are presented.

Company expansions and acquisitions at this level will generate great interest from the press, as well as provide the perfect opportunity to connect the company’s industry value to the funding announcement.

Series B indicates that the development stages are fully complete and that the company is moving over into funding for business growth and can demonstrate stable revenues. During late-stage funding, the company can pursue expansion and growth opportunities. By now, the startup is no longer a high risk investment.

Examples of funding rounds

As your business grows and develops, your newsworthy stories will also change. Funding news can be approached from a few different angles. Together with the nature of your company and the funding round you’re in, a compelling brand narrative can be leveraged to attract investors.

Here’s a few examples of how companies of different scale landed media coverage, in different stages of PR funding:

Example 1: Chargebee

Chargebee operates in the software as a service (SaaS) realm of tech. Their services enable businesses to set up and manage billing processes, subscriptions and revenue operations.

The company is one of the very few startups who have managed to join the coveted unicorn club. Their success comes from their series G funding round, during which they raised $125 million. Led by Sapphire Ventures and existing investors Tiger Global and Insight Venture Partners, the 10-year-old startup managed to reach a value of $1.4 billion.

In business, the term ‘unicorn’ refers to a privately funded startup company that’s valued at over $1 billion. They are extremely rare, hence being named after a mythical creature.

PRLab assisted Chargebee to announce the news of their series F funding to a global audience. The startup is an example of how big investment create big news. The statistics speak for themselves, however, the press releases incorporated how Chargebee’s continued success is based on them satisfying a huge service demand.

The PR campaign cleverly link the press stories about their big financial gains with the added market value that Chargebee brings to the table. This shows how the startup is able to drive a compelling brand narrative, beyond profit, throughout their funding announcements.

For investors, this means an added layer of trustworthiness and transparency about the company. Using a timeline of past events, in the build-up to the latest funding round, tells a story of perseverance and shows that business growth opportunities are continuously pursued and successfully managed.

Example 2: Agicap

With the FinTech market ever-evolving and new developments occurring in the industry, companies operating in this field have many opportunities to grow their business.

Agicap is one of the companies who’ve seen rapid growth over the last year. They closed their series B funding round at €80 million, making them the leader in cashflow management for SMEs.

Having secured €2.4 million seed funding and €18 million during their series A funding, the company is an excellent show of how a reputable brand image, and demonstration of stable revenues, can lead to great capital gains during early funding rounds.

PRLab assisted Agicap providing PR services for FinTech and generating media coverage around their funding announcement and also their ambitious market expansion plans. The story centred around introducing Agicap as a trusted service provider who’s here to support small and medium companies in their cashflow management, regardless of the country they operate in. The success from the series B funding acted as the key point in showcasing Agicap’s growth as a company.

Example 3: Siilo

Siilo is a secure medical messenger platform, designed for healthcare professionals. Today, Siilo is the largest medical network in Europe with over 250k active members.

During 2020, the company had just closed their series A funding round, while providing critical services for medical professionals during the COVID-19 pandemic. They made use of PRLab’s PR services for HealthTech to announce their funding success and also to generate publicity around brand to elevate their status as a leader in MedTech.

This is a show of how a valuable service offering, accompanied by early funding round success, can generate great PR content about the future outlook of a company. As the company is still growing, the €9.5 million capital gain from their series A funding round sets a good foundation from which to build a strong narrative for future funding announcements.

No matter the stage of funding, nor the size of the company, businesses should value their funding announcements. It is highly important to share funding announcements in the media, to keep on attracting investors and to show how your company’s using capital investments to add value to the market.

The role of public relations in startup funding rounds

If your startup is showing high growth potential, it will certainly draw attention from private investors. That’s why it’s important to get your news published and noticed by worthy investors, as well as worthwhile business prospects.

Here’s where the PR team steps in. The days when startups saw funding rounds as instantly newsworthy, easy-to-pitch marketing material, is long gone. Closing a funding round is not enough to intrigue the press and journalists anymore.

Public relations is a great tool, within the integrated marketing approach, to use for getting interest from venture capitalists. After all, PR is about increasing awareness and nurturing the brand’s image.

When managing investor expectations, a well-planned strategic communications will aid you in establishing credibility throughout your funding round proposals. The goal is to gain trust from investors, in order to convince them that your business is a low risk investment. For this, PR takes the time to earn media coverage that will support your credibility and validity.

Financial transactions play a significant part in determining the startup’s future trajectory. This also means that the communication management that goes into sharing the news around funding announcements needs critical care. For internal and external communications, the PR team works to establish a cohesive brand narrative in support of the current or future funding round.

Especially in the private tech sector, capital is constantly being poured into companies, with a daily flow of investments being made. This renders most funding announcements unremarkable. This is why a public relations strategy is needed to ensure a spotlight story is published where venture capitalists will take note of your company.

Public relations is greatly beneficial in setting you apart from the competition. Not only this, but the PR team also assists you in professionally dealing with the media. In turn, a positive image in the media can amount to brand credibility and authenticity. Both these factors are greatly important to consider when attracting new investors.

Since a simple funding announcement about the transaction details isn’t enough anymore, the role of public relations in startup funding rounds has grown in importance to scale the business. PR is there to support fundraising and to secure new acquisitions or to retain existing stakeholders.

When sharing the latest funding news, the holistic company message and vision should not be lost. This is why experts suggest that startups should align themselves with PR professionals to create breakthrough narratives around the funding announcement.

As the funding provides the foundation for continual growth, the funding announcement needs to receive a great deal of attention, so that successful investments can be secured. The insights from PR experts only help to improve the success rate thereof.

The main goal of public relations is to create, maintain and protect the organisation’s reputation. PR ties into startup funding rounds by promoting and managing funding announcements. Managing investor expectations and securing new investments is also a critical area of focus for the PR team.


Hopefully this article helped you to gain a better understanding of the different funding rounds and what funding series are. Every business needs funding to continue growing their market share and to generate revenue. For startups, the A B C funding round series is especially important. The founders should be able to present investors with evidence of growth and market traction, then additional funding rounds can be planned. As the business grows and larger investments are made, the numbers will start generating newsworthy content by themselves.

However, before you have highly impressive capital gains, you’ll need a good public relations strategy in place to draw the attention of investors during venture capital rounds. Even during or after late-stage funding, public relations plays a critical part in funding announcements. It’s about pulling your key brand narrative through and highlighting the value adding benefit of your business, in correlation with your different funding rounds.

August 31, 2021
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