In early March 2020, Freshpaint — a young Y Combinator startup — began raising its seed round. Two weeks later, the world shut down. COVID-19 was declared a pandemic, markets crashed, and most institutional investors froze.
Yet the team still closed an oversubscribed $1.65 million round in one of the worst fundraising environments imaginable.
Years later, they published one of the most honest post-mortems in startup history: “Anatomy of a Seed Round During COVID-19.” Inside it was an infographic mapping every investor and where their money actually came from.
One data point jumped out as almost unbelievable.
Among the checks was one for just $5,000 from a founder/operator angel.
On paper, it looked tiny next to $50k and $200k checks. Many founders would have thanked the person politely and moved on.
Freshpaint didn’t.
That $5,000 investor didn’t just write a small check — he became a catalyst. He made warm introductions to other angels. Those angels introduced more people, including funds. The domino effect was insane.
In the end, the chain reaction started by this single small investor brought in $700,000 — 43% of the entire round.
The founders put it plainly in the post:
“If we hadn’t taken that small check, we likely would not have connected with many of those other investors.”
The Brutal Lesson Every Founder Needs to Remember
Fundraising isn’t just about the size of the check. It’s about network leverage and social proof.
A well-connected angel who writes $5k but actively advocates for you can be worth exponentially more than a passive $100k investor who disappears after wiring the money.
Small checks often come from operators and founders who still have fresh networks, genuine excitement, and the willingness to pick up the phone for you.
How to Spot the “Small but Mighty” Angels
You can’t always know in advance, but you can get pretty close:
- Scan their LinkedIn and X/Twitter: Who do they follow? Who follows them? Have they been involved in successful follow-on rounds?;
- Ask other founders they’ve backed (even small checks): “How helpful were they with intros?”;
- Listen during the first conversation: Do they immediately offer to make introductions, or do they just ask about valuation?;
- Check their past investments — connectors tend to back multiple winners in the same ecosystem.
If someone feels like a genuine champion, the size of their check is often the least important thing about them.
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What Happened to Freshpaint?
Freshpaint builds a customer data platform that lets companies collect behavioral data from websites and apps and instantly route it to hundreds of analytics and marketing tools — no engineering headaches required. They started with a strong focus on healthcare.
After surviving that brutal 2020 seed round, they went on to raise two more rounds (in 2022 and 2024). Total funding to date: approximately $42 million. The company is still growing strong.
The original Freshpaint blog post remains one of the best, most transparent fundraising breakdowns ever written. If you’re raising money (or ever will), go read it here:
https://www.freshpaint.io/blog/anatomy-of-a-seed-round-during-covid-19
Bottom line: The next time someone wants to write you a “small” check, don’t dismiss them. Sometimes that $5k investor is the reason you close the other $700k. Respect every check — the smallest one might quietly power nearly half your round.
