The Big Picture
Data points and market trends
What are investors currently investing in?
A couple of weeks ago I shared several graphs about what B2B software European investors were currently investing in. Here is an update concerning 60 new Seed and Series A rounds that were announced the past five weeks.
56% of the startups that have announced their round are vertical startups.
Investors are still mainly investing in industry specific software (the previous figure was 60%).
66% of the startups are AI-First.
Previously the split was 47% of AI-First startups for 53% of non AI-First.
Around 30% of these 60 startups were climate related startups.
I’m counting only B2B software climate related startups, not deep tech ones (e.g: battery tech) or other models (e.g: alternatives to meat).
So the early stage market is still heavily going toward AI powered SaaS software, and my guess is that AI powered SaaS will just become the norm.
Article of the week
Research and thoughts
Road to $1M ARR
There is a cool exercise that I like to do with early stage founders which consists in roadmapping their path to $1M ARR, broken down into four stages:
From 0 to 1 customer.
From the first customer to $100k ARR.
From $100k to $300k ARR.
From $300k to $1M ARR.
We start by inputting numbers like average revenue per user, churn rate and growth speed to understand the number of customers required and the sales velocity needed to reach these various ARR thresholds. This exercise is often eye-opening.
Next, we cover the major critical aspects depending on the stage they are in. This includes customer discovery, acquiring the first customers, creating the first repeatable sales and marketing playbook, choosing the relevant Go-to-Market strategy, establishing the foundational marketing assets, or determining the required org structure..
I usually do this exercise in Google Docs or Spreadsheets but I’m trying to productize it so that people can do it themselves.
It’s still pretty much a work in progress at the moment, but if you want to test it and roadmap your path to $1M ARR here is the link.
If you have any comments or suggestions, I’d be super happy to hear them 👍.
Business Breakdown of the Week
Interesting startups and products
What is Veesion?
Veesion is a software that helps shop owners detect theft through an artificial intelligence that analyzes the video feeds generated by in-store surveillance cameras.
What I find interesting:
As I explained in my list of the nine major AI product archetypes, one of the major strengths of AI is its capacity to extract meaning from unstructured data.
Veesion is a great example of how AI can leverage video streams from surveillance cameras to extract data that was previously inaccessible.
I've seen this playbook (surveillance camera feed analysis) several times, but it was mostly for marketing purposes (measuring the number of customers visiting a shop) or for security monitoring on the manufacturing floor (to detect incidents).
The company announced that it has surpassed €10M in ARR, demonstrating that this model is viable from a business perspective and not just a technological novelty.