CBinsights recently published a study , which has a few really salient points about the realities of startup equity funding.

First, though Silicon Valley and the New York metro area are the United States’ two largest VC hubs, the Boston metro area has the largest percentage of seed-funded companies receiving follow-on investments. This cohort of companies in the Boston area achieved a 68 percent investment rate during their startup equity funding. What does this mean for New England and, more specifically, Maine? That after receiving initial seed capital, it is more likely that these companies receive crucial follow-on capital to keep themselves running in the Boston area than anywhere else.

As you start your plan for your first capital raise, it’s worth noting that this study found the average time between first-round and second-round capital raise was 22 months. This is a relatively long time between investments, meaning seed companies need to make sure they raise enough money during their initial investment to allow themselves to make the necessary development to secure the next round of capital. Once you raise your seed capital, manage your cash burn carefully, there will most likely be a decent wait time between investments.

The study also highlighted that the average initial seed capital raised across the United States was $750,000, which is very similar to Maine. But after the seed round, follow-on investments in other parts of the country were much larger, averaging around $4.5 million. Though equity financing events of that size have happened in Maine, they are rare. This raises the question, as an ecosystem, what can we do to realize larger equity capital financing in Maine?
f
Thits
FEATURED PORTFOLIO COMPANIES
Pika Energy - Westbrook, Maine
Pika's Energy Island is a complete home energy storage platform that connects solar PV, smart batteries, loads, and the grid. Check out their award-winning home energy storage system that's smart, simple, and powerful.
Nyle Systems - Brewer, Maine
Nyle is a growing manufacturing company that is focused on three core markets: Lumber Drying, Food Drying and Heat Pump Water Heating. They serve Maine's lumber and food industries as well as having customers across the US and beyond.
GRANTS AVAILABLE NOW! MTAF 2.0

Maine Technology Institute is requesting project proposals from Maine organizations, or organizations looking to locate in Maine, who anticipate making investments in equipment, infrastructure and technology upgrades to drive innovation in Maine.
ARE YOU INTERESTED IN LEARNING MORE
ABOUT OUR PORTFOLIO COMPANIES OR OUR
INVESTMENT PROCESS?
GO TO OUR WEBSITE
Maine Venture Fund
P. O. Box 63
Newport, ME 04953
Tel: (207)924-3800