Today, we are finding out how much money a startup needs to raise to be counted among the best-capitalized new companies in its home state.

Why bother with this? Because for states not on the coasts, the exercise gives local entrepreneurs and outside observers a benchmark for evaluating where a company sits on a states spectrum of startup companies.

Crunching the national numbers

Well start at the national level before we dive into individual states and their nuances.

To answer our question, we aggregated pre-IPO venture capital and venture debt deal data from around 24,600 companies that meet the following criteria:

  • The company was founded in or after 2003 what most consider the age of the unicorn.
  • The company is based in the United States and we know where its located.
  • The company has raised rounds of known size.
  • The company is not in the petrochemical, life sciences, clean energy or heavy manufacturing sectors, which have significantly different funding dynamics and capital requirements than typical tech startups.

Were going to find out what it takes for a company to be at or above certain positions on the startup funding curve. So how much money does a startup need to raise to be in the upper half of U.S. startupsin terms of the amount of money raised? To show this, we made a chart plotting the total amount of money raised that corresponds to different percentiles, from zero through one hundred.

And heres a table that shows the corresponding amounts of total startup funding for key points of interest on the graph above.

For all the companies we analyzed, the amount of total private funding each has received really runs the gamut. The midpoint of the curve, the median value, might be surprising. For your startup to be on the upper half of the funding curve, nationwide, you must raise at least $1.75 million from investors. Although that number may appearsmall to many, it shows just how few companies are able to raise any significant amount of capital.

From there, numbers go up and to the right fairly quickly. To join the vaunted one percent of startups, as ranked by the total amount of money raised, a company needs to have received roughly $163 million in pre-IPO equity and debt financing. And unless youre Uber, well, theres no way youre in the 100th percentile.

State by state

The curve above may illustrate the national rankings, but what about on a state-by-state level?

Its probably unfair to stack companies based in states with comparatively smaller tech startup ecosystems against, say, New York or California. Well, founders from Wyoming, North Dakota, Alaska and Iowa, youre in luck. We crunched the numbers for all 50 states in the union, plus the District of Columbia.

In the map below (interactive version here), youll be able to see the cut-off point for joining the top 50 percent of companies in your state, ranked by total funds raised to date.

It wont be a shock that certain states have higher median (which is a fancy way of saying the 50th percentile) funding amountsthan others. States like California, Texas, New York, Massachusetts and others with relatively high levels of startup activity are more likely to have higher median funding values than those with less startup activity.

That should strike most as fairly obvious, but whats interesting about this map is that, ultimately, theres a relatively narrow range of funding levels that land companies in the top half of startups in their states.

Notwithstanding outliers like Hawaii, where the median funding amount is $75,000 in our data set, raising between $500,000 and $2 million is enough to join the top half of companies in many states. During a time where multi-million-dollar seed rounds happen with surprising regularity on the coasts, one might be surprised to learn that raising just $1 million is enough to rank in the top half of companies in 28 states.

In other words, theres a fairly low barrier to entering the top half of startups especially outside of the coasts.

The rich kids table

But what about the top 1 percent of startups in each state? Here we have another map (interactive version here):

We see higher numbers (and darker colors) in states with relatively high levels of startup activity. But one of the other data pointsthis map highlights is the geographic distribution of well-capitalized companies. California and New York are both home to a lot of companies with lots of funding behind them, which results in fairly high total fundraising figures for the 99th percentile of companies.

However, there are still companies with high values at the 99th percentile threshold despite having comparatively less startup activity. Thats because these states are home to at least one company thats received a large amount of private investment.

For example, Utah and Arizonas 99th percentile figures are comparable to Californias. Although Utah has its own startup scene in the Salt Lake City and Provo metropolitan regions, its because three unicorns Domo (with $689 million in equity financing), InsideSales.com (with $251 million in financing) and Pluralsight ($192.5 million in financing) are headquartered in the state.

Arizona is the home of Carvana, which received $300 million in equity financing before going public in April, as well as other well-funded companies like OfferPad and Katerra. Katerra joined the billion-dollar valuation club last month with a $130 million Series C round that valued the company at $1 billion. Its interesting to see just how much influence one or two well-capitalized startups can do to the numbers at the extreme end of the funding spectrum.

Standing out from the crowd

Joining the exclusive club of one-percenters is hard, and, by definition, nearly every company fails to gain entry. But thats alright.

For founders and investors alike, the heartening thing to take away is that, in most cases, even a small seed and Series A round puts your company in the top half of startups founded in or after 2003. And if theres one good thing about being middle of the pack, its that you have plenty of company.

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