The short answer
A bridge round is a smaller, short-term raise that extends a company's runway until it hits a milestone or closes its next full round. Bridges are often done on SAFEs or convertible notes, frequently with existing investors.
- A bridge extends runway to a defined milestone or round.
- Existing investors often lead bridges.
- SAFEs and convertible notes are common bridge instruments.
- A bridge without a clear milestone can signal trouble.
How it works
A company that needs a few more months to reach a milestone raises a modest amount, often on a SAFE or convertible note that converts in the next priced round. Bridge investors sometimes get a lower valuation cap or a bigger discount to reward the timing risk.
Worked example (hypothetical)
A seed-stage climate hardware company has five months of runway and a pilot with a utility that finishes in seven. Its Series A investors want to see the pilot results. Existing investors put in $400K on SAFEs with a $12M post-money cap, adding about five months of runway. The pilot finishes in month seven, and the company starts its Series A with real data and some cushion left.
Good bridge vs risky bridge
- Good: a specific milestone, a believable timeline, insiders participating.
- Risky: no clear milestone, insiders declining to join, repeated bridges.
Why it matters to a pre-seed or seed founder
A bridge can turn a weak raise into a strong one by buying time to prove something. Ask for it early, tie it to a milestone, and model the conversion on your cap table. Watch your runway so you're not forced into one.
Frequently asked questions
Who usually funds a bridge?
Often existing investors, sometimes with a few new angels or family offices.
Is a bridge round a bad sign?
Not by itself. A bridge to a clear milestone is normal; repeated bridges without progress worry investors.
What instruments are used?
Usually SAFEs or convertible notes, which convert in the next priced round.