Female Foundry Week 74: Redefining growth. The power of less. VCs keep check sizes on par. CVCs outpace VCs in job-hopping. London Tech Week.
Welcome to The Week 74, 2023 Edition of the Female Foundry newsletter!
Female Foundry - where investors and female founders meet.
In the news
London-based Synthesia, co-founded by Lourdes Agapito, lands an €83m Series C round led by Accel for its AI video creation platform and becomes a new female-founded unicorn; Cambridge-based OXCCU, co-founded by Jane Jin, bags a €20.6m Series A round led by Clean Energy Ventures to transform CO2 into sustainable fuel; Luxemburg-based SustainCERT, co-founded by Marion Verles, picks up a $37m Series B round led by Partech and Hartree Partners to bring credibility to climate impact claims; Stockholm-based Mitigram, co-founded by Marjon Wohlén, bags an €8.6m Series A round led by Sampo for its digital trade finance platform; Copenhagen-based Dynelectro, co-founded by Samantha J. Phillips, fetches a €4.5m Seed round led by EIFO and Vsquared to drive affordable production of green fuels; Amsterdam-based Smiler, co-founded by Martine Rooth, snaps a €7.9m Series A round led by Octopus Ventures to expand its photo booking platform; London-based Yayem, co-founded by Lindsey Elkin, picks up a €1.8m Seed round from angel investors for its new experiential learning platform; Brussels-based IONNYK co-founded by Charlotte Dubois raises a €1.5m Seed round for its art photography platform.
Voima Ventures, co-founed by Inka Mero, launches its third €90m VC fund to back Nordic & Baltic science startups from labs to global markets; A solo GP Sarah Drinkwater raises a third of her first £10m fund Common Magic to back 30 companies 'community' startups with £100k-150k cheques; London-based VC firm Black Seed, co-founded by Yvonne Nagawa, announces a first close of €5.8m to back black British founders.
Spotlight
Rethinking growth.
Rising interest rates have damped the enthusiasm for growth stage investors by slashing portfolio valuations, making exits challenging and lowering investor confidence. While not everyone is as pessimistic - Emmanuel Macron recently declared his mission to overturn French tech's weak IPO record, PE GPs are feeling more competitive pressure, and three-quarters of LPs are expecting more down rounds in the next 12 months compared to the previous 12 months. They are not alone. A rising number of growth stage investors are rethinking how they approach new investments, becoming highly selective in their approach. While the Rule of 40 is still relevant, greater emphasis is now being placed on achieving a positive EBITDA margin, making businesses that burn lots of cash to feed their growth significantly less attractive. Prioritising widening profit margins rather than relying on expanding market multiples represents a significant shift in the growth sector of the private equity market, which today competes for scarce capital but a mere three years ago, surpassed a total asset value of $4tn. Read full story ➯
Fundraising
The power of less.
This week was pretty much all about London Tech Week but I managed to catch up with two founders. One of them recently raised a €1.5m Seed round - half a million below her €2m target. Fundraising took much longer than expected and she conceded to a lower raise.
There is always a bright side to any situation, and the need to do more with less might set you onto a more focused path and build a better company culture. How? Having limited resources requires you to focus on the things that really matter, give more responsibilities to your existing team - make them work together and grow faster, systematically evaluate opportunities, be more decisive and get great at saying 'no’, and let go of anything that isn’t essential. In what other ways might being frugal positively influence your startup’s culture? Check out this great article. I also recommend this piece on how to better understand your runway and how to manage it.
Announcement
Join Female Foundry this summer!
Only 2 days left to apply! Applications close on Monday, 19th of June 10pm.
We are working on some exciting projects to be launched later this year and I am looking for an intern to join Female Foundry in the coming 3 months. If you know anyone who is passionate about venture capital, innovation and startups, and has great communication skills, please tell them to apply.
This is a paid internship opportunity with a possibility of becoming a part of the team in a long term. Start date: Early July, Duration: Min. 12 weeks. Weekly time commitment: Min. 20hrs. Compensation: TBD. Location: Remote/Europe or in London. ALL genders welcome!
Analysis
Top VCs keep check sizes on par.
Over the past few years, the growth of venture capital and rising company valuations have contributed to the continuous increase in median deal sizes for early-stage investments but surprisingly, the study which took into account angel, seed, and early-stage investments at the top 15 most successful VC firms worldwide, has found that in Q1 of this year, the median deal size for emerging tech companies has actually remained pretty much unchanged compared to the same quarter last year, despite the shift in the fundraising market. Although the overall increase in total deal value was relatively small, around $200m, it marked a reversal of the declining check size trend observed in the previous three quarters, with biotech leading the way in terms of deal value, followed closely by the AI & machine learning sector. Surprisingly, even Web3 & DeFi have managed to keep on par.
CVCs outpace VCs in job-hopping.
A newly published study from Stanford University finds that venture capitalists working at Corporate VC funds are more likely to change jobs compared to those at Institutional VC firms. The study, which analysed 74 CVC and 320 IVC investors, reveals that after three years, a staggering 33% of CVC employees leave their positions, compared to only 7% of VCs. What might explain the finding is that compensation at CVC firms is not aligned with long-term incentives of their employees (e.g. no carry), also CVC units are more prone to reorganisation or cost-cutting. The high turnover clearly poses challenges for CVCs and their parent companies. The study also highlights the importance of strategic thinking about compensation and retention for CVC firms.
From the Community
Female Foundry x EQL:HER x London Tech Week
What an amazing Week this has been! Thank you to all of you who joined us on Wednesday for the Investor Power Hour we organised in collaboration with EQL:HER and London Tech Week.
Here is a short video from the day, you can view a few snaps from the event here.
It was fantastic to see so many female founders and investors in one room! Thank you for all your great energy. The future of venture looks bright!
Hiring
This week hiring:
Agurotech ➯ Operations Support | Finway ➯ Team Lead | SACLÀB ➯ E-commerce lead (student).
See more jobs on the Female Foundry Job Board.
Founder & Investor Meetups
Monday, June 19, Antwerp ➯ Startup Hurdle | Tuesday, June 20, Paris ➯ Festival Generation Impact, London ➯ Climate Tech Pitch event | Wednesday, June 21, London ➯ Tech Trailblazers Meetup, Paris ➯ StartUp Nation Club | Thursday, June 22, Berlin ➯ Growth without worry | Friday, June 23, London ➯ Women in Engineering Day.
Impact Shakers has just opened up applications to its Impact Angel Programme. Mention 'NetZero' in your application to get additional 10% off on the Early Bird Price (ends July 1st).
Have a great weekend! See you next week.
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.
Thank you, Catherine. It was great to have you !
Thanks again for organising the LTW event. Great to be amongst such energy 💫