📶 Commonapp.VC State of Fundraising (2023)

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Good morning 👋

We started Commonapp.VC roughly two years ago to make it easier for founders to put their business in front of investors. We still have a lot of work to do, but we are starting to see some results.

This report gives an overview of the types of companies that have submitted over the past year, and it provides insights you can use to get a better gauge of the overall fundraising market.

Check out all companies through Commonapp.VC by following the link below.

TL;DR:

• 📋 Business Model

• ➡️ Offering Type

• 📶 Sectors

• 🗺 Geography

• 🛠 MVP Status

• 📈 Revenue Status

• 💰 Revenue Status

• 🤑 Looking to Raise

Read more: 25 Pitch Deck Mistakes, Founder Hub

BUSINESS MODELS

B2B is the most popular form of business, although B2C is a close second.

OFFERING TYPE

Traditional software is the most popular type of business with almost half of all applications identifying as such. ~1/5 of companies create mobile apps, and the remaining are split between physical products, hardware, or something else.

SECTORS

No surprises here. Companies come from all across the spectrum, but digital health fintech, AI, and marketplaces are the only sectors with >5% of submissions.

GEOGRAPHY

The majority of Commonapp submissions come from companies based in the US, but a growing number of submissions are abroad.

The most popular locations in the States are cities you would imagine: New York, Los Angeles, and San Francisco. Atlanta, Austin, and Miami are representing the South with multiple submissions. The majority of international submissions come from Europe, and London is the European city with the highest volume of companies represented.

MVP STATUS

We ask companies if they have an MVP built in their application. The results mirror what you would expect.

No-code tools have made it easy for anybody to test an idea, and you no longer have to sink tens of thousands of dollars into creating an MVP from scratch. As a general rule, it is a bad idea to raise even a pre-seed round without having an MVP built.

REVENUE STATUS

It is easier than ever to start a company but harder than ever to scale a company.

Only ~60% of seed companies have made a dollar. If you are a pre-seed company, you’re ahead of the competition if you have any revenue; if you are a Series A company without revenue, your days are limited unless you turn it around.

PREVIOUS CAPITAL

Most pre-seed companies are bootstrapped. Seed and Series A previous capital raised will differ by geography.

• Pre-Seed: $20,000

• Seed: $242,500

• Series A: $1,500,000

*All numbers are the median amount raised

LOOKING TO RAISE

This will depend on the business model, geography, and underlying metrics more than anything, but these are good data points. We will circle back next year to see how these numbers change in a bear fundraising market.

• Pre-Seed: $588,000

• Seed: $2,000,000

• Series A: $3,250,000

*All numbers are the median amount raised

Read more: Cooley financing trends

Thanks for reading this far and giving us a little bit of your attention this week.

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- Clay and Tyler