A recent study found that deep tech startups led by technical CEOs typically secure larger funding rounds. This insight is valuable for software as a service (SaaS) developers looking to improve their fundraising strategies. The study suggests that having a technical leader could give them an advantage when seeking larger funding rounds.
Point Nine’s “napkin” approach could potentially be leveraged by these founders to secure significant investment. These strategies are great at simplifying complex business models, making them easier to understand and more appealing prospects for potential investors.
In Europe, First Momentum is funding deep tech teams working on hardware development. The pre-seed fund specifically targets tech B2B and deep tech startups. The German-based venture capital firm covers areas such as fundraising, team building, product and market development, providing important guidelines for those embarking on their entrepreneurial journey.
A First Momentum survey of 30 deep tech venture capitalists across eight countries found that startups led by technical CEOs tend to secure more funding than those led by business-focused executives.
Technology expertise boosts startup funding, research highlights
It is hoped that this insightful study will have a ripple effect, potentially shaking up existing startup leadership narratives and shedding new light on investment patterns.
Despite potential survey bias, First Momentum highlights the value of technical founders adding business-related skills to their repertoire. This, coupled with their technical knowledge, helps them better understand startup operations, strengthens decision-making, and improves their problem-solving abilities. This also streamlines communication with stakeholders and investors, strengthening overall business relationships.
Unique characteristics of the deep tech sector, namely the need for significant funding levels and a long timeline for success, were also highlighted in the study. The study also noted a notable increase in pre-seed funding for deep tech hardware startups in 2023 compared to the previous year, suggesting a surge in investor interest.
First Momentum not only provides a comprehensive understanding of future market trends and industry requirements, but also supports deep tech startups in improving their technical capabilities, managing intellectual property and refining prototypes, assists them in overcoming regulatory challenges and obtaining relevant permits, and facilitates collaboration opportunities with potential investors and stakeholders.
