In today’s market, no single metric defines what a Series A is, or how to raise one. At this year’s TechCrunch Disrupt, three investors offered founders advice on raising one, and one of them tacked on a warning. With money pouring into AI and revenue numbers being inflated to justify sky-high valuations, a correction could come as soon as 2027.
The warning came from Shailendra Singh, a managing director at Peak XV, who spoke alongside Jahanvi Sardana, a partner at Index Ventures, and Jenelle Teng Wade, a partner at Bessemer. In fact, it’s common now to see a company trying to close a round with as many as three different prices at once. Beyond the warnings, the investors laid out what they look for in a Series A pitch, including, first, a persuasive story about why a founder has a shot at building a big company.
What a founder builds matters, too. Teng Wade said capital is flowing into areas such as defense, robotics, and AI infrastructure. She also noted that foundational model companies are moving toward vertical integration (taking on more of the stack themselves), but there’s still room for newer players, including neo-clouds that rent out AI computing power and neo-labs focused on AI research.
Metrics, meanwhile, still help a lot, but they are less defined than they used to be, especially in an era like AI where it’s incredibly expensive to run a company. Teng Wade gave an example of how her firm evaluated Anthropic in its early days, when its margins were negative, and it was spending heavily on compute. One partner on her team, however, felt that AI was going to be “bigger than everything we’ve ever expected in terms of price premium on the frontier models,” she said, “becoming a substitute for other types of software.” The logic was that even with money-losing margins, the market would be big enough to pay off if the company became one of the top three players.
Anthropic is now reportedly preparing an IPO at a valuation of around $2 trillion. It told investors this month it was profitable on an adjusted basis, though that measure excludes some costs. The investors also spoke about the importance of honesty in a market like this, where inflated annual recurring revenue (ARR) numbers are swirling alongside headline valuations.
This is as optimistic as I’ve seen the venture world in two decades, and normally it’s a sign. I think 2027 will be different. I think we will see a correction.” Finally, the panelists were asked to give founders at least one piece of parting advice.
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