5 metrics Series A investors look for at dev-tools startups

A year ago, developer-focused software companies were being funded at huge valuations, buoyed by the prospect of blockbuster IPOs like those from Snowflake, HashiCorp and Confluent. Now, with the market downturn, raising capital for a dev-tools startup is much more difficult. But it’s not impossible.

After meeting hundreds of developer-tools startups and talking to dozens of fellow investors over the last several months, I’ve noticed a common characteristic among founders who have raised successful Series A rounds: They’re great at telling their companies’ stories. Of course, it takes more than a way with words to raise capital, and in this column, I’ll delve into a practical, step-by-step guide founders can use to move successfully from seed to Series A.

Before we get started, it’s important to set expectations. The average Series A price for dev-tools companies is falling, and valuations are down across the board. The median Series A round for a developer-tooling company was $47.5 million in Q3 2022, the lowest it has been since the beginning of 2021.

Seed rounds are raised to validate a problem and create an early solution. Series A rounds are used to bring a solution to market, get a few customers to care and see early signs of monetizing that solution. As an investor in many developer-first businesses, including Docker, Redis and Startree, these five metrics are what I look for:

Developers are in the driver’s seat at most tech-first companies, and capturing their imagination will dramatically increase your GTM efficiency.

User growth

The most important metric VCs want to see is non-linear organic growth of your product’s user base, including usage expansion within specific teams. So try to provide at least a month of weekly and/or daily data.

If you’re running an open source company and user count is therefore hard to instrument, instead show usage growth through proxies like downloads or in-product engagement.

Remember, not all users are created equal. A company looks stronger if its users are from modern, engineering-first companies such as Robinhood, Confluent, Databricks and Airbnb.


Revenue is taking an increasingly important role in Series A fundraising conversations. It’s not actually the amount of revenue that matters, it’s the quality. You could raise a stellar Series A at $100,000, $500,000 or $5 million ARR. Investors point to current revenue as a leading indicator of what revenue could look like as your company grows.