The Problem With Fast Follows

AI Summary

In venture capital, the timing of fundraising rounds is rapidly evolving, leading to a trend known as 'fast follows.' Some startups are raising new funding rounds just weeks after closing older ones, reflecting an aggressive investment climate and heightened competition for capital in the tech industry.

How soon is too soon to raise a new funding round? I’ve been covering venture capital long enough (more than a decade!) to remember that the hottest startups used to raise financing every 12-18 months. Then it was 9-12 months. Then 6-9 months. And now…two months? Two weeks?  Recently, a wave of both early and late stage startups have been raising new rounds of capital right after closing other ones, in what some are calling “fast follows.” The latest example is Core Automation, a startup incorporated by a star-studded list of AI researchers in late March, about the time it was raising $100 million at a $1 billion valuation from investors including Nvidia, Accel and Spark Capital.