Series B investors typically prefer to receive convertible preferred stock to common stock because of the unique features associated with preferred stock.
Series B funding can come from private equity investors, venture capitalists, crowdfunded equity and credit investments.
What is a Series B?
Series B financing (also known as series B round or series B funding) is one of the stages in the capital-raising process of a startup. Essentially, the series B round is the third stage of startup financing and the second stage of venture capital financing.
What are Series A shares?
The name refers to the class of preferred stock sold to investors in exchange for their investment. It is usually the first series of stock after the common stock and common stock options issued to company founders, employees, friends and family and angel investors.
What is Series B and C funding?
These funding rounds provide outside investors the opportunity to invest cash in a growing company in exchange for equity, or partial ownership of that company. Next, these funding rounds can be followed by Series A, B, and C funding rounds, as well as additional efforts to earn capital as well, if appropriate.
What is the difference between Series A and B funding?
Series A and Series B rounds are funding rounds for earlier stage companies and range on average between $1M–$30M. Series C rounds and onwards are for later stage and more established companies. These rounds are usually $10M+ and are often much larger.