Female Foundry Week 123: Holding a grip. How to see your unearned revenue. What you get wrong about your runway. Back to school. Female Foundry x TechBBQ.
Welcome to The Week 123, 2024 Edition of the Female Foundry newsletter!
Female Foundry - the future of venture is here.
In the news
Oslo-based Cardboard, co-founded by Vidhi Kumar raises a €1.9m Seed round led by Skyfall Ventures for its software subscription optimisation platform; Danish Tiimo, founded by Helene Lassen Nørlem and Melissa Würtz Azari, fetches a $1.6m extension round co-led by Crowberry Capital and People Ventures for its neurodivergent app; Oslo-based Ocean Oasis, co-founded by Kristine Bangstad Fredriksen, bags a €6m grant from the European Executive Agency to turn wave power into freshwater; Dutch foodtech startup PeelPioneers, co-founded by Lindy Hensen, lands a €4m growth capital round from Brabant Development Agency to transform citrus peel into valuable resource; Swedish Nordic SeaFarm, founded by Elisabet Brock and Gunilla Toth, raises a €2.2m Seed round led by EIT InnoEnergy and the Inter IKEA Group to scale its ocean cultivation in Europe; UK-based femtech BoobyBiome, founded by Tara O'Driscoll, Lydia Mapstone, and Sioned Fôn Jones picks up a £1.6m grant from Innovate UK.
London-based Arāya Ventures, founded by Rupa Ganatra Popat, announces the €9.8m first close of its Arāya Super Angel Fund; Amesterdam-based Carbon Equity, co-founded by Jacqueline van den Ende, Lara Koole and Liza Rubinstein Malamud, raises €10m for its Climate Infrastructure Fund I.
Spotlight
Holding a grip.
Nvidia’s valuation plunged nearly $200bn after its earnings missed investor expectations on Tuesday this week, spoiling its first results party and making at least a few market entrants hopeful of getting hold of its market share.
Right now, chips (and AI for that matter) is a big players’ game..
It was also revealed this week that nearly half of Nvidia’s $30bn revenue comes from just four huge companies - their identities have been withheld in the filings for competitive reasons. To put that into perspective, these four mystery companies contributed more to Nvidia’s sales this year than all of Nvidia’s total revenue for the previous year combined.
.. and that game is not only played between big tech, it is also played by whole economies.
Just last month, it was confirmed that Meta's upcoming multimodal AI models won't be available in EU countries due to the bloc's strict regulations. And Meta is not alone. Just a month earlier, Apple decided to delay launch of some of the latest AI features for the iPhone in Europe, blaming EU tech rules, stemming from EU competition laws. Last year, Sam Altman also hinted that OpenAI might exit Europe if regulatory conditions become too ‘challenging’.
And so, the broader clash between Silicon Valley and European regulators is intensifying. With the EU arguing that advanced AI technologies will make us even more dependent on Big Tech, who will maintain their grip, and how will it impact innovation and our lives as a whole?
Meet Visionaries Cohort I
Renude
“The world’s first dermatologist approved AI skin advisor.”
This week, it’s time for Renude, the third company in Cohort I of the Female Foundry Visionaries AI Incubator in partnership with Google Cloud.
The skincare market is massive. I mean $190bn massive and growing (18% CAGR). With more people than ever focused on beauty and appearance (the hashtag #SkinTok has amassed 18 billion views) and so many beauty products available, 79% of consumers feel overwhelmed by skincare.
Built by a female-only founding team: Pippa Harman and Catherine Nisson, with chemistry and data science expertise, Renude is able to offer personalised skincare advice that’s easy to follow, and delivered in 3 minutes.
How? Renude has built a proprietary data set of over 3 million data points, leveraging computer vision, machine learning and LLMs, served over 100,000 B2C customers and started licensing its AI solution to B2B clients this year.
Current team’s focus? Growth of its B2B offering (to be ready for a new fundraising round in Q2 next year). - The team is looking for intros to big retail brands (think: John Lewis, Next, Estée Lauder).
Want to get in touch? Drop an email to Pippa ➯ here and follow the team ➯ here.
Check other female-founded companies in Cohort I.
Fundraising
How to see your unearned revenue.
If you are a founder of a SaaS business (there are good chances that you are), you likely charge your customers upfront before delivering your service. However, when it comes to recognising that revenue, things can get tricky. I recently looked at balance sheets of a couple of early-stage founders and noticed a common confusion: how to properly recognise revenue as a SaaS company.
So now, even if a customer signs up for an annual subscription, you can only recognise the revenue as the service is actually delivered. This unearned revenue sits on your balance sheet as deferred revenue—a liability. The corresponding asset is either ‘cash’, if the customer prepaid, or ‘accounts receivable’, if payment is expected later. As you deliver the service, deferred revenue decreases, and recognised revenue increases, spread evenly over the contract term. - Getting this right is crucial.
Now, if you want a clear picture of your company’s growth, look at your billings. (Billings are calculated by taking your revenue for the quarter and adding the change in deferred revenue from the previous quarter). Why is this important? Billings offer a far better forward-looking view of your company’s health than revenue alone, which understates the true value of your customers (since revenue is recognised incrementally). Chances are that your future investors will look into that because a SaaS company might appear to have stable revenue over time simply by depleting its billings backlog, which can create the illusion of a healthier business than it actually is!
What you get wrong about your runway.
Earlier this week, I spoke with yet another founder who was figuring out her budgeting plans for a new year, assessing her runway and looking when she should be raising her next fundraising round. I have nothing against budgets. However, planning your next fundraising round should never be a budgeting exercise but a growth exercise! You should never ask for money when you see no growth. Never. As it says on the tin: runway is meant to make you fly - if there is no uplift, it’s not a runway!
Analysis
Back to school.
There has been an ongoing debate about how much a founder's educational background plays a role in securing VC funding. When you look at Y Combinator’s recent alumni, the answer becomes somewhat clear.
Now, recently published data that looked at global VC investment and the education of nearly 167,000 founders over the past 18 months has shed even more light on this, revealing that when it comes to successfully fundraising founders, there are a few schools that stand out.
For undergrad studies, the University of Oxford takes the crown (though it ranks 55th globally), with the University of Cambridge and Trinity College Dublin following close behind. But when it comes to grad school, Cambridge and Oxford flip positions at the top, with INSEAD (🎉) joining the mix. And for MBAs? It’s INSEAD, London Business School, and IE University leading the pack, with their alumni raising the most cash.
Community
Female Foundry x TechBBQ
Female Foundry is an official partner of TechBBQ taking place in just under two weeks - on the 11-12th September 2024 in Copenhagen.
If you are yet to get your ticket, take advantage of the Female Foundry 25% discount on all ticket types using ➯ this link.
Hiring
This week hiring:
Prewave ➯ Sales & Go To Market Systems Manager | SAPI ➯ Head of Sales and Partnerships | Spyke Games ➯ Marketing Artist.
Founder & Investor Meetups
Our Partner, Accenture FinTech Innovation Lab, is now accepting applications for their new 2025 Programme!
Accenture’s three-month award-winning accelerator is welcoming talented founders with big ideas to transform the Financial Services industry. If you are a pre-seed, seed or early series A start-up ready to catapult into the next stage of growth, forge meaningful relationships across our world-class network of mentors, client partners and Accenture industry experts, ➯ Apply Here by the end of September to be considered for FIL2025!
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This week meetups:
Monday, September 02, Berlin ➯ CLIMATE LAUNCHPAD FINALS OF GERMANY | Tuesday, September 03, London ➯ Unravelling SAAS, Berlin ➯ Silicon Allee Monthly Meet Up | Wednesday, September 04, Berlin ➯ Climate Tech Pitch Night | Thursday, September 05, Paris ➯ Petit-déjeuner L'ADN Data | Friday, September 06, Berlin ➯ Women in Deep Tech.
That’s all for this week. Have a great week ahead!
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.
Check femalefoundry.co for more fundraising tools and investor content. View other Female Foundry articles.