AI startups at the seed stage are commanding valuations far above their non-AI peers, with $10 million rounds at $40 to $45 million post-money becoming standard. Fewer deals are closing, but the ones getting done are significantly larger.
AI-focused seed startups are pulling in larger checks at higher prices than the startup world has ever seen at this stage. Pete Martin, founder of AI cybersecurity company Realm, raised a $5 million seed at a $25 million post-money valuation in 2024. Two years later, he said, a $10 million seed at $40 to $45 million post-money is now standard for AI companies. Non-AI startups, he noted, are barely getting a look.
The numbers back this up. According to Carta data, the median post-money seed valuation on primary rounds hit a record $24 million in Q4 2025, up from $18 million a year earlier. AI startups specifically carry a 42% valuation premium over non-AI companies at the seed stage, with a median pre-money valuation of $17.9 million in 2024. AI companies now absorb roughly 42% of all seed capital, up from 23% before ChatGPT launched in late 2022.
At Y Combinator’s March 2026 Demo Day, investors noticed startup prices climbing higher than usual. Ashley Smith, a general partner at early-stage fund Vermilion, told media she saw companies asking for $5 million at $40 million post-money. Some startups had six- to seven-figure customer contracts within eight weeks of being founded. Smith said investors in this market are pricing rounds years ahead of traction.
Bigger VC firms are also moving into earlier rounds, pushing smaller funds out. Marlon Nichols, managing general partner at MaC Ventures, said his average entry check has doubled from $2.5 million in 2019 to $5 million now. His last two seed investments were generating over $2 million in revenue, with paid enterprise pilots already in place. He valued both between $25 million and $30 million post-money.
Investors are also paying premiums for AI talent.
Amber Atherton, a partner at consumer fund Patron, pointed to the competition for top researchers driving valuations higher. The most extreme example is former OpenAI executive Mira Murati, who raised a $2 billion seed for Thinking Machines Lab at a $12 billion valuation in 2025.
“There’s a war for great researchers right now, and I don’t think it’s good or bad; it’s just the current state of the market,” Atherton said.
The speed of AI companies is resetting expectations. Cursor hit $100 million in annual revenue within 12 months. Companies like Lovable, Bolt, and ElevenLabs followed with similarly fast growth. Shanea Leven, founder of AI enterprise platform Empromptu, said raising as an AI founder took her three weeks. A friend raising for a non-AI startup took two years to get half the amount.
Seed-stage VCs are adapting by investing more at pre-seed, where startups look like seed companies did a few years ago. Jonathan Lehr at Work-Bench, investing from a $160 million fund, said his firm is increasingly comfortable backing companies at pre-seed because they scale so fast. Atherton said her firm’s average check rose from $1 to $2 million in Fund I to $4 to $5 million in Fund II.
The pressure has a downside. Higher seed valuations leave less room for mistakes. Founders now face tighter timelines, with investors expecting startups to hit milestones in about 18 months. Series A investors want bigger numbers, faster. Martin warned founders risk getting stuck between rounds if traction does not match the price they raised at.
