We are happy to share the conclusion of the first call for proposals of Openfund II, or 7th overall.
Following 5 Call for Proposals (CFPs) executed under the Openfund I, we distinguish between a conceptual one (CFP 6) which counts the proposals seen during the preparation of the Openfund II, and another one explicitly launched when the new fund was announced (CFP 7).
As with every previous call for proposals, we can now share some trends and insights regarding the quantity and quality of submissions, complete with statistics.
The charts below depict the evolution of the proposals volume over time. Notably, the couple of latest CFPs that are now under review process received in aggregate twice the number of submissions of the next best performing CFP. Another interesting trend is the increase in the average team size, from 2.4 to almost 3 members. Teams now encompass more Founders and more diverse skills, a development we consider positive.
The graph above shows the cumulative collection of submissions over time. As with every previous CFP, most Founders took the maximum allowed time to refine their submission.
After 3.5 years, we are now able to take a look at the proposals in greater depth.
Initially, the Openfund was designed to address the lack of seed funding in the Greek market. With each passing CFP however, the inflow of proposals from other countries increased. So far and on average, 56% of the proposals originated from Greece.
This changed dramatically with the 7th CFP under Openfund II, where we announced that we would start investing only in companies registered in Greece or whose Founders would relocate here. Now, focusing on a smaller pool of talent, we managed to attract more proposals than ever before, more than 80% of which came from Greece.
Despite clearly stating our criteria for funding, the persistence of a significant number of proposals originating outside the borders indicates that seed funding is still a problem for Europe. It also suggests that Founders are more willing to relocate than previously thought, in order to secure resources for their startups from a trusted source.
It is interesting to note the distribution of skills in startups, based on the self-evaluation of each Founder. The graph below provides data on the entrepreneurs having applied in all CFPs so far. Brighter colours indicate higher scores, at a scale of 1 to 5. An interesting fact is that confidence in the Founders’ business and technological skills fuels most startups.
Over time, we also find more complementary teams applying, meaning that there is at least one individual with a high mark in at least one of those skills. Most importantly however, we can now correlate the team composition with the likelihood to succeed in getting funded.
Through the CFPs 1-5, there were 3 evaluation steps:
- Submitting a proposal,
- Being called for an interview, and finally
- Presenting for the Openfund executives and investors.
The radar graph above provides some insights on the average team skills that made it to each step.
It seems that a strong educational background seems to initially earn the Founders more attention; however the successful teams do not score significantly higher than others on paper qualifications.
On the other hand, a (self-reported) strong business background stands for better chances down the evaluation path. Moreover, the successful teams score a comparatively low average in technical skills with usually just one strong technical leader. It also serves as rudimentary verification of a trend that we have often seen: teams that are too reliant on the technical prowess of the Founders are found lacking in other aspects.
Another interesting observation regards the impact that a detailed proposal has on our tendency to further engage with a team. As documented, we typically collect submissions which we then forward to our mentors. They in turn, submit their feedback which is compiled and returned anonymously to the Founders.
Naturally, this data refers to previous CFPs, as we have not completed the review of the collected proposals.
As expected, writing more increases the likelihood that we’ll spend more time with a project proposal and increases the chances that mentors will want to engage in providing more feedback as well. What is difficult to depict in past data is the also higher than expected chance that an exuberantly lengthy proposal gets rejected early. In principle, including template text or not to-the-point arguments greatly reduces the reviewer’s interest in providing any feedback.
Funding range & maturity
The table below shows the distribution of maturity in the latest couple of CFPs. More than 56% of the submissions in total have a functional prototype to showcase during the various review stages.
Apparently also, having a prototype proves that the team can work together and increases the chance that it gets further consideration.
During the next days the Founders that have submitted their proposals will start receiving feedback. The application page will remain open and Founders can submit, however there is no time guarantee as to how soon we will reply.
At this point, we’d like to thank all the Founders for entrusting us with their ideas and putting a tremendous amount of hard work in preparing for this call. We will do our best to come up with quality feedback and reaffirm our excitement about the investments that will come out of this process.