The Delta Round: Normalizing the Increasingly Common (and Unfairly Maligned) Fundraising Stage

C2 Ventures
Jun 30
2 min read

It was tempting to spend this month’s Notes from the Trenches newsletter unpacking the surreal state of Big AI: $100M signing bonuses, $1T infrastructure rumors, billion-dollar monthly burn rates. But we felt compelled to focus instead on a quieter (but arguably more important) corner of early-stage venture.

We’re talking about the far-too-stigmatized middle ground between Seed and Series A, by far the hardest leg of the startup journey, where most startups almost inevitably (and unfairly) end up finding themselves stuck balancing increasingly unrealistic expectations with practical realities.

VCs have long treated these “bridge rounds” as a red flag. A sign of trouble. A lifeline for companies that mismanaged budgets or needed to radically pivot.

But that narrative no longer holds. And in fact, it hasn’t for a while.

We’re calling this funding stage what it actually is: The Delta Round.

Why “Delta”?

It’s short, memorable, and actually means something (mathematically and financially, Delta = change or difference, in addition to being two letters removed from Alpha and Beta, both well-known, early product development landmarks)
It acknowledges that the expected growth between Seed and Series A is no longer realistically achievable for as many as two-thirds of otherwise healthy, well-run startups.
It removes the baggage of “bridge” language, which implies weakness or failure.

What’s going on?

The bar for raising a Series A has moved way up. Meanwhile, the expectations at Seed haven’t shifted much. That growing gulf means most startups need additional capital to keep moving forward.

Carta data shows that nearly half of all Seed-stage companies now raise a bridge round, and when you dig into it further, the real number is probably closer to 60 to 70 percent.

This isn’t because these companies are broken. Quite the opposite.

They’re growing, iterating, hiring, and learning. They just need more fuel in the tank to make it to Series A, and smart investors are recognizing that.

Key takeaways from our analysis:

Delta Rounds are the norm, not the exception, for even the best companies In our own portfolio, about 60% of companies that made it to Series A or beyond raised a post-Seed bridge round along the way.
Delta-backed companies may actually scale faster. Those who raised a Delta Round reached $5M+ ARR in an average of 40 months, vs. 56 months for companies that skipped it.
Bigger Seed rounds aren't the solution. Raising $5M at Seed doesn't mean you'll get more done than if you raised $2.5M. In most cases, founders will make all the same early-stage mistakes and just spend more doing it.
The stigma needs to die. The term “bridge” carries unfair weight in VC circles. It causes hesitation, even among smart investors who know better. Rebranding it as the Delta Round gives founders and funders a shared language that we hope will reset the market’s view on this critical funding stage.