Healthcare & Pharmaceutical Startup Fundraising in Equity Crowdfunding

CHART OF THE WEEK 📈

In today’s Chart of the Week, we look at how healthcare and pharmaceutical startup valuations in the equity crowdfunding space have changed over the past three years. 

• When looking at average valuations in the healthcare & pharmaceutical industries, we see a clear increase over the past three years, from $14.9 million in 2021, $34.7 million in 2022, $44.5 million in 2023, and $54.6 million in 2024 (YTD). This represents a three-year CAGR of ~54%. 

• However, in statistical analysis, it is important also to analyze medians to ensure that outliers aren’t skewing the data.

• In this case, median valuations over time have a much tighter distribution ($10.3M in 2021, $20M in 2022, $17M in 2023, $14.9M in 2024). 

• When the median and average for a data set are drastically different, the median is usually a better indication of the data's central tendency. 

• Therefore, using medians in this case, we can conclude that over the past three years, valuations in the ECF space for healthcare & pharmaceutical startups went up from 2021 to 2022 but have been slowly declining since.

To learn more about healthcare startups, including amount raised, read our full analysis from Teddy Lyons HERE 

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PITCH REVIEW 💸

Brief: Handprint Tech’s platform enables companies to offset their carbon footprints and demonstrates how sustainability can boost revenue through verified Nature Credits. These credits support ecosystem restoration, aligning economic gains with environmental impact. It’s raising $1.2M with a Valuation Cap of $23M and a minimum investment of $100.

Key People: CEO Mathias Boissonot focuses on expanding U.S. sales, marketing, and the impact data team. Chief Vision Officer Simon Schillebeeckx drives strategic direction and innovation in ecosystem restoration and develops a unique SaaS marketplace that helps companies profit while restoring the planet. Though new to the industry, Chief Impact Officer Ryan Merrill is crucial in measuring and communicating the ecological impacts of Handprint’s initiatives, supporting the company’s mission of ecosystem restoration and carbon offsetting through verified Nature Credits.

Interested in Handprint Tech? Access the deal report HERE 🔓📈

Summary

Here's what we like: Handprint Tech is pioneering an approach in the global carbon offset and broader environmental sectors through its innovative SaaS marketplace. By integrating sustainability as a revenue driver rather than a cost, Handprint is strategically positioned to appeal to a wide range of businesses looking to contribute positively to the planet while benefiting financially.

Handprint's ability to demonstrate that investing in nature is ROI positive through its A/B test with a leading Australian e-store, which saw a 16% increase in sales, further solidifies its value proposition. This evidence of direct financial benefits tied to sustainable practices provides a compelling argument for businesses to engage with Handprint's platform, potentially leading to rapid adoption and growth within the highly lucrative global carbon offset market.

The company's strategic partnerships and backing by notable investors such as Singtel Innov8, EGR Partners, Thunes, and Kheng Nam Lee highlight the confidence and support from the investment community. Such support provides the necessary capital to fuel growth and opens doors for further collaborations and opportunities.

Here's what we don't: Despite its noble mission to enable companies to profit while restoring the planet through its SaaS marketplace, it presents several risks that warrant a cautious approach from potential investors. The valuation of $23 million seems ambitious for a company that only generated $24,417 in revenue. This discrepancy suggests that the company is overvalued, raising concerns about the feasibility of achieving a return on investment in the foreseeable future.

The global carbon offset market is extremely competitive, with notable direct competitors such as EcoMatcher, Ecologi, TreeApp, DGB Group, and OneSeed. This intense competition could hinder Handprint's ability to capture a significant market share, especially considering the company's current lack of proprietary technology or patents that could offer a competitive edge. 

The low barriers to entry in this market could lead to an influx of new competitors, exacerbating the challenges Handprint faces. The path to profitability appears uncertain, particularly given the company's limited proven traction and the fact that the founders are not dedicated. This may raise questions about the company's leadership and commitment to navigating through its early-stage challenges.

STAFF PICKS 🌶️

The HACKERverse

HACKERverse is enhancing how businesses evaluate cybersecurity tools by providing a patent-pending virtual environment where buyers can demo products from various vendors. With a 420% revenue increase in Q4 2023 and an anticipated 3,600% community growth by the end of 2024, HACKERverse is capitalizing on a crucial niche in the cybersecurity market.

• Valuation Cap: $10 million

• Minimum Investment: $100

Foghorn (Debt)

Foghorn, a neighborhood taproom based in San Francisco, California, is known for its craft beer and wine selections, alongside popular dishes like chicken wings and fried chicken, all served in a warm and friendly atmosphere. With a current crowdfunding campaign target ranging from $20,000 to $124,000, the proceeds are earmarked for opening a new location and supplementing working capital, aiming to replicate its cozy dining experience for a broader audience. Campaign Closes 04/30/2024.

• Interest Rate: 10.5%

• Minimum Investment: $10

Nuudii System

Nuudii System offers an alternative to traditional bras that honors women's natural shapes and provides comfort, flexibility, and freedom. The company has grown impressively, serving over 100,000 customers across 40 countries and generating $6 million in sales with a 78% gross margin.

• Valuation Cap: $11 million

• Minimum Investment: $100