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It’s been nearly a month since ChubbyBrain launched its Funding Recommendation Engine (FRE) into private beta through our entrepreneur newsletter. In that time, we’ve also provided private invitation codes to friends at the following publications ReadWriteWeb, Business Insider, TechFlash, Xconomy, Black Web 2.0 and a handful of other private small business publications so their readers could give it a spin.
Aside from receiving and integrating a bunch of great feedback into the FRE and making a few intros to venture capital firms with entrepreneurs whose ideas caught our eye, we also observed a number of interesting trends (some eye-opening, some expected) in people who are seeking funding for their businesses and figured we’d share it with the entrepreneurial community.
Here is some high-level data on 1173 of the companies going through Funding Recommendation Engine so far (the thousand in the title was a nicer round number for titling purposes
New York Beats Silicon Valley
Shocking? Yes. Plausible? Perhaps. In fairness, ChubbyBrain is a New York-based company and so this likely drove some of the local buzz and uptake of the FRE’s private launch. Nonetheless, it’s impossible to deny the diversity of the geographical areas we surveyed based on the media partners we worked with. Furthermore, this gives credence to the growing trend of early stage internet companies who choose to call New York their home.
Entrepreneurs Are In Their Thirties and Forties
What you read about in the popular startup press might lead you to believe that companies seeking funding, especially early stage startups, are all led by wunderkinds. Not so, says our data. Over two-thirds of those who completed the FRE had at least 10 years of work experience and over 40% had at least 15 years of work experience. So for those of you in your 30′s and 40′s, who believe that everyone with a startup is a Mark Zuckerberg-style genius, don’t worry – you’ve got company.
Entrepreneurs Are Well Educated
Again, Harvard (or other) dropouts are not the norm amongst Funding Recommendation Engine participants. A whopping 88% of our FRE users had at least a bachelors degree, and 46% had a masters or doctorate degree.
Funding Seekers Come In All Stages
So much attention is paid to seed stage (generally pre-revenue) startups that it’s easy to overlook the fact that companies who’ve launched, have early traction and/or are operating with revenue need funding too. In fact, amongst the FRE population, nearly half of the companies have already launched a product and 17% are making money. Some have thousands or hundreds of thousands of users for their technology – we are talking serious traction.
Many Funding Seekers Aren’t First-Timers
Fundraising is not all about Seed and Series A. In addition to the fact that money can be sought at numerous stages in a company’s life cycle (as seen above), many businesses who’ve already received funding are actively looking for more. In fact, over one-third of our FRE respondents had previously received funding from angel investors, venture capital firms or government grant programs.
Web Companies Need Funding
Nearly half of the people who completed the FRE are seeking funding for an Internet business. In fairness, there’s likely a great bit of self-selection here as the population who reads many of the aforementioned publications may be skewed towards Internet entrepreneurs. Nonetheless, Healthcare came in second with a relatively healthy margin above the rest of the pack.
Interested in giving the FRE a try? Sign up for our newsletter and we’ll send you an invite code as part of our next newsletter.
By the way, if you’re an investor who wants to ensure you show up in the FRE’s results, you can certify your investment portfolio by emailing us at fre (at) chubbybrain.com.
Shortly we will be releasing similar analyses to the one above, but broken down by media partner to see how they stacked up individually. In the interim, sign up for an invite code to the Funding Recommendation Engine and check out some of our educational guides on venture capital, angel investment and investor reverse due diligence.