For decades, a small fundraise meant a broker. Capital raisers, placement agents, investment banks at the larger end. They would introduce you to investors, paper the round, and take a percentage of the money raised.
The percentages varied. The work mostly didn't. And the work that did happen was almost entirely about access.
What brokers were actually selling
Brokers sold three things. First, a Rolodex: they knew the active investors in your space and could route you to them. Second, a paperwork stack: they could produce the documents, navigate the regulatory wrinkles, and shepherd the legal process. Third, social cover: having a broker meant the investor took the introduction seriously.
The Rolodex was the expensive thing. Founders couldn't easily find active investors in their stage and sector; the information lived in people's heads. Brokers held the relationships, charged the fee, and the structure worked because the alternative was worse.
It doesn't work anymore. The information that used to live in people's heads is searchable. Active investors publish their theses, write checks publicly, and increasingly show up on platforms where founders can see them directly.
What the fee was actually buying
When a broker charged 6% of a $1M raise, the founder was paying $60,000 for what was mostly access. Some of that fee covered real work: paperwork, coordination, legal review. Most of it covered the asymmetry: you couldn't find the investor without them.
That asymmetry is collapsing. Founders today can identify the right investors in a sector in an afternoon with a few searches and some asking around. The friction that justified the broker's margin is largely gone.
A fee survives only as long as the friction it taxes does.
What still needs doing
Some functions of a broker still matter. The paperwork stack, legal review, term negotiation, SAFE templates, is real work, but it's commoditized. A $2,500 templated SAFE round closes the same gap a $60,000 broker engagement used to.
The social cover, the implicit "this is a real raise" signal, is being replaced by platforms that verify identity and curate participants. The signal moves from "X firm introduced this" to "this raise lives on a platform that vets both sides."
And the matching function, finding the right investor for the right founder, works better when it's powered by search and structured data than when it depends on a single broker's memory.
The new model, briefly
Strip the broker function into pieces and price each one honestly. Matching is cheap on a platform. Paperwork is cheap with templates. Verification is cheap with technology. None of these justify a percentage of the raise.
A subscription, a flat fee, a usage-based price: those are the right pricing models for these functions. A percentage of the raise was always pricing the access, not the work.
What it means
If you're paying a percentage to raise capital in 2026, you're paying for friction that no longer exists. The same outcome, finding the right investors, executing the round cleanly, is available at a fraction of the cost through platforms, templates, and direct outreach.
Some founders still need handholding. That's a different product. Pay for the handholding, not the access. Access is free now.