Early-stage software investing being reshaped: Nexus Venture

ASAIADOPTION accelerates; the benchmarks for early-stage software investing are being reshaped.

- AYANTI BERA

ASAIADOPTION accelerates; the benchmarks for early-stage software investing are being reshaped. Just a few years ago, $1 million in annual recurring revenue (ARR) was enough for a SaaS startup to go for a Series A round. Today, the new threshold, at least for top-quartile AI SaaS companies, is closer to $3-5 million, says Arjun Gandhi, vice president at Nexus Venture Partners.

That said, the fund doesn't use strict benchmarks, Gandhi adds.

"If we love the team and their execution ability, we may invest pre-revenue with just a prototype. Other times, we'll track companies for months to build conviction," he says.