The disparity between seed and series A funding, known as the funding gap, is a problem that many technology communities are facing. It’s widely believed that a series A crunch will hit companies in Silicon Valley in the coming months due to an increase in startups and a decline in large investments.

In Los Angeles, the pickup in startup activity is due, in part, to accelerator and incubator programs that have opened up over the last year. They are designed to help companies through their challenging early months.

Seed funds are moving to the area to catch the wave of young entrepreneurs graduating from accelerators and hungry for cash.

Karlin Ventures opened in Brentwood during the summer to invest in early stage technology companies. The venture capital fund is backed by the private investment firm of billionaire Gary Michelson, who ranked No. 28 on the Business Journal’s list of Wealthiest Angelenos.

Tianxiang Zhuo, Karlin Ventures’ managing partner, said he saw opportunity in Los Angeles because the market isn’t as saturated as it is in Silicon Valley.

“We really see the market at a stage where it’s about to see a lot of exponential growth,” he said. “I wanted to be part of a new market and something that was growing quickly.”

Karlin was part of’s oversubscribed seed round. The firm plans to invest primarily in seed rounds and co-lead some series A rounds. It will contribute to series B rounds for companies already in its portfolio.

Other funds expected to open in Los Angeles include Lowercase Stampede, founded by Silicon Valley angel investor Chris Sacca, which will invest in companies at the intersection of technology and new media, and DominateFund, founded by former tech journalist Ben Parr, which plans to help Hollywood types invest in technology companies.

Andy Wilson, former managing director of now-defunct investor Momentum Venture Management, said it’s a positive sign that Los Angeles is attracting funds when other tech communities, including Silicon Valley, are experiencing a shortage of new investors.

But these funds are adding to an already robust seed funding community – with established investors such as Siemer Ventures and CrossCut Ventures in Santa Monica – when the real gap lies in later-stage funding for startups.

“The scale of these funds is probably in most cases not sufficiently large enough to deal with where the bigger problem is going to be,” said Wilson, who now runs Pasadena startup Rexter. “In many ways, in the long run, they could exacerbate the problem.”