Female Foundry Week 116: Big love. Big bucks. First Impressions. Grasp your churn. France leads generative AI funding in Europe. Live Sessions: Demystifying Boards.
Welcome to The Week 116, 2024 Edition of the Female Foundry newsletter!
Female Foundry - where investors and female founders meet.
In the news
Berlin-based forward earth, co-founded by Cari Davidson, raises a €3.2m round from private investors and European Union (EFRE) to simplify environmental data reporting; German femtech PINK!, co-founded by Prof. Dr. Pia Wülfing, gets acquired by Icelandic healthtech Sidekick Health to strengthen its position in the digital therapeutics market; London-based Apolitical, co-founded by Robyn Scott, receives a $5m grant from Google.org to scale up its Government AI Campus program; Berlin-based generative AI startup mika, founded Agnieszka M. Walorska raises a €800k pre-seed round, led by Samen Slimmer to automate accounting for SMEs; Spanish space mobility company IENAI Space, co-founded by Dr. Sara Correyero Plaza, raises a €3.9m round led by CDTI and GED Capital for small satellites.
Spotlight
Big love. Big bucks.
Elon Musk had Tesla shareholders approve (apparently with a standing ovation!) his $56bn pay package on Friday last week, making him the highest-paid CEO in history—assuming he can dodge a Delaware judge’s disapproval. For context, Elon Musk’s eye-popping salary is more than the annual revenue of Tata Motors ($54bn) and over two times the total annual revenue of McDonalds (sitting at a modest $25.76bn). By comparison, Berkshire’s CEO, Warren Buffett, earned a mere $100k in annual salary over the past 40 years with total compensation barely reaching the half-million mark. On how Musk’s salary is constructed check ➯ this article.
But Elon’s salary boost is not an isolated incident. In fact, despite more than a decade of controversies, median CEO compensation at the 500 largest S&P companies increased at its highest pace in at least 14 years in 2023 according to the latest figures. This controversy has now taken on new dimensions amid Elon Musk’s campaign to ‘restore Tesla’s stockholder democracy’ by ratifying his 2018 pay package.
How does the average startup founder’s salary compare? Perhaps influenced by high interest rates and high inflation, luckily there seems to be a positive trend related to startup compensation too.
While figures differ depending on the startup's stage (the amount of capital raised) and its location, the fresh reports show that in general, US-based startup founders from Pre-Seed to Series A draw higher checks (median salary:$132k, with 17% annual increase) compared to European startup founders (median salary:$110k, with 4% annual increase). For more data check these reports (➯ US, ➯ Europe)
Fundraising
First impressions.
It's been a super busy week. We are in the peak of the events season with BBQs, conferences, demo days, summits, and meetups in full swing. I am happy. And I am tired. I hope that you too are not getting distracted by saying ‘yes’ to all invitations right now and are staying focused on building!
If you do say ‘yes,’ I hope even more that you create the best first impressions. No, first impressions are not about compromising, hiding, or pretending to be someone else—I do seem to meet so many female founders with a pair of white Veja/Gazelles + pleated skirt combo these days. If that’s the real you, that’s okay. If it’s not, start being you. —First impressions are all about allowing yourself to open up to new opportunities.
If you have already decided to use those couple of hours of your precious time to create new opportunities for yourself, pay attention to first impressions. First impressions do last! Make sure you’re not grumpy, uninterested, disrespectful, arrogant, or unfocused. Bad first impressions are the biggest killers of the start of any relationship, including those with potential investors! Stay smart. Feeling tired? Go home. Don’t let a yawn in the middle of a conversation blow up your biggest opportunity yet.
Grasp your churn.
We live in an era of abundance of choice. For startup founders, this creates a unique challenge: providing differentiated value with your solution, yet ensuring your product is broad enough to holistically meet your clients' needs. And so, being able to monitor and understand why your customers leave is critical on your journey to find a product-market fit. Do you know the key drivers of your customer churn? Here are the top four reasons behind your customer churn:
Lack of Value: If customers do not perceive sufficient value in your product or service, they are likely to move to a competitor. This can happen if the product fails to meet their expectations or if they do not see a significant return on investment.
Poor Customer Experience: Customer service and user experience play crucial roles in retention. Poor interactions, unresponsive support, or a complicated user interface can frustrate customers, leading them to seek better experiences elsewhere.
Better Alternatives: With numerous options available, customers may switch to a competitor offering better features, pricing, or service. Deepening your value proposition is key to keep your product attractive.
Misalignment of Expectations: Make your customers understand what is on offer and that you can keep the promise. Overpromising will backfire sooner than later! For ideas on how to reduce churn, read ➯ here.
Analysis
France leads generative AI funding in Europe.
GenAI has been on investors’ lips for some time now, and freshly released data sheds more light on the amount of funding going into the space across the European region. Together, Europe and Israel typically make up around 45% of all global venture funding, but when it comes to AI, the proportion drops to around 23%.
Looking at European cities, nearly one-third (27%) of the AI startups that received funding were created in London, with Berlin taking 12%, Paris 10%, and Amsterdam 5%. However, collectively, it is French GenAI startups that are raking in the most money, having raised $2.29bn to date (think Mistral AI, ‘H’, Hugging Face, and most recently Poolside).
To give you more perspective, France’s $2.29bn of funding that has gone to the GenAI startups is nearly as much as the next three countries (including Israel) have raised combined. The UK ($1.15bn - Stability AI, Synthesia, and PolyAI), Israel ($1.04bn - AI21, Run), and Germany (Aleph). Beyond that, other countries in the region have pulled in less than $160m each — sometimes significantly less, with some countries in Europe seeing overall funding in the very lowest realms of seven digits.
Community
Live Sessions: Demystifying Boards
We are looking forward to seeing you at a 30-minute virtual session on Wednesday where Nic Lenz, an experienced board advisor and angel investor, and Zurich-based Fatemeh Nikayin, who earlier this year raised a €7m Series A round for her company Rivero will share practical tips and have your questions answered in relation to board formation and its management.
This is going to be an open lunch session for anyone to ask questions. If you haven’t secured your spot, do it now.
*Note that this is a live session and will not be recorded.
Hiring
This week hiring:
Cozero ➯ (Senior) Sustainability Manager | Native Teams ➯ Business Development Representative | Aegir Insights ➯ Head of Europe.
Founder & Investor Meetups
Tuesday, June 25, Berlin ➯ K.I.E.Z. Female Founders Happy Hour, Paris ➯ Happy Hour Fintech | Wednesday, June 26, Paris ➯ Apéro Startups | Thursday, June 27, London ➯ How to complete a successful tech business exit in 2024.
Enjoy the weather today and see you all next Sunday.
Agata
Written by Agata Leliwa Nowicka, an investor, a startup adviser, a two-time entrepreneur, and a founder of Female Foundry based in London.
Suggestions? Drop me an email.
♡
Thank you to Alice for the startup research.
Check femalefoundry.co for more fundraising tools and investor content. View other Female Foundry articles.