Fundraising
Series B
The third major institutional funding round, typically raised after demonstrating product-market fit and early revenue traction, used to scale sales, marketing, and operations.
A Series B is the third significant funding milestone for a venture-backed startup (following seed and Series A). By the time a company raises a Series B, it should have clear evidence of product-market fit, a repeatable go-to-market motion, and meaningful recurring revenue — typically $5M–$20M ARR for SaaS companies.
Series B capital is used to scale proven playbooks rather than discover new ones: expanding the sales team, investing in marketing, entering new markets, and building out operational infrastructure. Check sizes typically range from $20M to $50M+, with pre-money valuations commonly between $50M and $200M, though both vary significantly.
The transition from Series A to Series B is often described as moving from 'figuring out the business' to 'building the machine.' Investors at this stage are focused on efficiency metrics, go-to-market scalability, and competitive moat.
In Practice
A B2B software company raised a $10M Series A at $40M post-money. After 18 months it's at $8M ARR, growing 150% year-over-year, with a clear enterprise sales motion. It raises a $30M Series B at $120M post-money to double the sales team and expand internationally.
Why It Matters
The Series B is where companies prove their model can scale — or fail trying. Many companies stall at this stage because early growth was driven by founder-led sales that don't transfer to a growing sales organization. Hitting Series B metrics efficiently is a major proof point for potential Series C investors.