Bridge round
An interim financing, usually convertibles from existing investors, that extends runway to a milestone the next priced round needs.
A bridge round is financing raised between priced rounds to extend the company’s runway to an event that should improve its price: a technical milestone, a commercial proof, a better market. It is usually structured as convertibles (SAFEs or notes) rather than priced equity, most often from existing investors, at terms anchored on the last round (same cap, or a modest discount to the next round).
The instrument is neutral; the reason is everything. A good bridge is an investment case: the milestone is named, the amount is sized to reach it with margin, and the insiders writing it can say why the milestone changes the next round’s price. A defensive bridge, money to postpone a hard conversation, shows up in the next diligence as exactly that, and stacks one more cap onto the convertible pile the Series A must digest.
The signaling cuts both ways. Insiders bridging at the prior cap reads as conviction if the milestone story holds, and as a quiet markdown if it does not; outsiders joining a bridge strengthens it. The honest comparison a founder must run before bridging: against a smaller priced round at a lower valuation today, which path reaches the value-creating proof with less total dilution and cleaner governance? Sometimes the down round is the cheaper bridge.
Bridges are more legitimate in quantum than elsewhere because milestones slip for physics reasons, not only execution ones. The discipline that keeps a bridge honest: it must buy a named technical milestone, not time. "Bridge to the demonstrator" survives the next due diligence; "bridge while we keep looking" becomes the bridge to nowhere every investor has financed once and remembers. An insiders-only bridge also raises the question a new lead will ask: if the people with the most information only bridged, why?
A $750,000 insider bridge on SAFEs at the last round's cap funds a company burning $83,000 a month for nine months (750,000 / 83,000 ≈ 9). Sized against the roadmap, that covers the demonstrator milestone planned at month seven, plus two months to close, on the result, the raise already in motion.
From definition to decision
Model this in your own round, scenarios, dilution and runway, in the founder workspace.