Bridge Rounds Are A Beige Flag

February 10, 2026

By The Artemis Fund
The Artemis Fund believes technology can create prosperity for all. With offices in New York, Texas, Massachusetts, and Nevada, Artemis leads seed rounds for companies creating resilient families, individuals, and businesses across the US.
For most of the past two years, a bridge round was interpreted as a red flag. Raising a bridge suggested a company had missed its window, struggled to meet the Series A bar, or was quietly hoping the market would turn before hard realities set in. In the 2022 and 2023 vintages, that interpretation was often correct.
Seed to Series A graduation rates fell to historic lows. Timelines stretched well beyond historical norms. Many bridge rounds extended runway, but not trajectory. In that period, only about 8-13% of startups that raised a seed bridge in 2022–2023 went on to raise a Series A, compared to roughly 18-26% of companies that did not raise an extension.
What we are seeing now is not a return to the 2021 market, but a shift into something more disciplined and, in many ways, healthier. The question is no longer why a company raised a bridge, but whether that bridge was designed to change the company’s trajectory. Many founders and investors are still using 2022 heuristics to judge 2025 decisions. To understand why, it helps to look at how we got here.

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How We Got Here
The post-2021 correction hit early-stage venture unevenly. Seed capital remained relatively available, even as Series A capital became far more selective. Median pre-money valuations at new seed rounds reached roughly $16M in Q1 2025, up about 18% year over year, even as seed deal volume fell by nearly 30%. Founders were asked to clear a higher Series A bar without the clean repricing events that historically reset expectations.
The share of seed deals that were extensions climbed steadily, from about 31% in 2022, to 39% in 2024, to roughly 46% in Q1 2025. More founders took bridges, not because execution deteriorated across the board, but because the classic venture cadence broke: raise a Seed, grow for 18 to 24 months, raise a Series A. Bridge rounds proliferated as a rational response to a misaligned system, not simply as a signal of poor execution. The ecosystem stopped agreeing on what progress looked like, and time became the variable founders were forced to buy. Many bridges delayed decisions without improving odds.
What Is Starting to Change
The good news is that the markets continue to adapt, even if slowly. Over the last several quarters, early signals suggest the worst of the graduation compression is behind us. Seed to Series A graduation rates are recovering from their lows, even if they remain below pre-2020 levels. Capital is being deployed more deliberately. Dry powder across the market is back in line with historical norms, and just as importantly, the function of bridge rounds is evolving.
Capital is being deployed to reach discrete inflection points rather than for speed. The market has shifted from time-based fundraising to milestone-based fundraising. We are seeing fewer extensions designed to defer hard decisions and more designed to fund specific work tied directly to Series A readiness. In that context, a bridge is less a pause and more a structured operating phase.
The Artemis Perspective
At Artemis, we have supported a limited number of seed extensions only where additional capital could credibly change the probability distribution of outcomes. That required real operating leverage, milestone clarity tied directly to Series A benchmarks, and alignment among existing investors around pricing and expectations. In today’s capital-concentrated, AI-skewed market, it also reflects the reality that many strong companies will raise less capital over their lifetime, making a disciplined bridge and the ensuing Series A among the final opportunities to invest before outcomes become clearer.
When that discipline is applied, the results are tangible. Across a small number of Artemis-backed companies, structured seed extensions raised at moments of operational inflection funded defined execution rather than additional exploration. In each case, those companies went on to raise priced Series A rounds in under twelve months, demonstrating how a well-designed bridge can compress timelines and materially improve the likelihood of graduation.
For founders navigating a bridge today, we recommend treating a bridge like a sprint with a scoreboard.
Define two or three non-negotiable milestones that map directly to Series A readiness. 
Measure them weekly, and line up potential leads early so the bridge is clearly positioned as part of a real A process, not a holding pattern. 
If your metrics are not compounding, consider resetting round mechanics rather than adding months of drift. Runway without a ramp rarely changes outcomes.
A bridge round by itself is a beige flag. What could make it a red flag is how the bridge is used. Green flag bridges tend to be intentional, milestone-driven, and clearly positioned as part of a real Series A process. They are legible to the next lead, ownership is aligned, and expectations are explicit. As this next cohort matures, the gap between companies that used bridges to compound and those that used them to drift will continue to widen.
We believe once in a generation companies will be built by unexpected founders. If that sounds like you, pitch us here!

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