The Deep Tech Napkin: A Scandalous Truth About Europe’s Tech Scene
Are you a naive entrepreneur looking to disrupt the deep tech space? Well, buckle up, because First Momentum’s "Deep Tech Hardware Napkin" is about to blow the lid off the entire industry.
In a shocking exposé, this German VC firm has revealed the brutal truth about what it takes to raise capital in Europe’s deep tech sector. And trust me, it’s not for the faint of heart.
According to the report, teams led by technical CEOs (with no business background) raise significantly more funding than those led by CEOs with a business-related background. Yes, you read that right. The technical geniuses are the ones raking in the dough, while the business-savvy types are stuck in the slow lane.
But don’t just take my word for it. The data is clear: at Seed and Series A, technical CEOs outperform their business-savvy counterparts by a landslide. And if you’re wondering why, it’s because they’re able to focus on the tech, while their non-technical counterparts are bogged down by commercial concerns.
But wait, there’s more. The report also reveals that even at Series A, only 29% of startups have reached a repeatable sales motion and meaningful revenue. So, if you’re thinking of joining the deep tech party, be prepared to spend a lot of time and money on research and development before you even think about scaling.
And don’t even get me started on the importance of cap tables. Francesco Ricciuti from Runa Capital warns that poor technology transfer can reduce your chances of success. So, make sure you’re careful about how you structure your ownership and control.
But don’t worry, there is hope. First Momentum’s report is full of actionable advice for founders, including the importance of derisking, identifying milestones, and understanding costs and gross margins.
So, if you’re ready to take the plunge and join the deep tech revolution, grab a copy of the report and get ready to shake things up. But don’t say I didn’t warn you…
