Fundraising cycles grow longer while investors plow through pitch decks

Dropbox DocSend, a secure document sharing platform and part of Dropbox, today released data revealing that investors spent an increased amount of time on the competition and "why now?" sections of seed decks despite spending 20% less time reviewing pitch decks year-over-year (YoY). Investors are scrutinizing key differentiators in a crowded yet disruptive marketplace while founders attempt to demonstrate definitive success metrics and need for urgency.

In its annual report, The seed round in 2022-23: No time like the present? VCs, founders focus on "why now?" amid ongoing slowdown, DocSend analyzed 170 seed startup pitch decks to gather insights on successful and unsuccessful pitch deck composition. Through the analysis, DocSend is able to better understand the nuances of current investor behavior in the last half of 2022 and first half of 2023.

Seed funding was down 27% YoY in Q3 2023, despite optimism about disruptive technology like artificial intelligence (AI). This sustained downturn in funding signals the seed stage is losing its resilience as market conditions worsen. To succeed in an investors' market, seed stage founders need to portray why now is the time to invest for long-term success against competitors.

The Importance of Now, and Later

Founders need to clearly communicate why their company is a good investment right now, even in a tough market, with a 65% increase in VC time spent reviewing the "Why Now?" section of pitch decks.

While founders need to demonstrate the short-term importance of an investment, they are expected to simultaneously display a solid path to success and profitability for the long-term. A strong product and business model slide should be polished and easy to digest, with review times on these deck sections dropping by 10% and 2%, respectively.

"Investors found comfort in the uncomfortable market and don't mind saying 'no' to deals," said Justin Izzo, senior research and data lead at Dropbox DocSend. "In order for seed-stage founders to succeed today, they need to clearly communicate two timelines: their product in the current market and its longevity. Founders need to communicate a sense of urgency with a compelling 'why'."

Competition Heats Up

While the seed stage is typically a time for focusing on internal growth as opposed to external factors, investors are paying closer attention to how startups stack up against their competition earlier in fundraising stages. Investors spent 88% more time on the competition section of successful pitch decks, demonstrating VCs are looking further ahead at potential external roadblocks that could interfere with their investment.

Artificial intelligence (AI) has shown charted growth in funding over the past year. AI related seed pitch decks jumped 48% YoY, emphasizing that even in sectors that are attracting investor attention, dense market competition crowds VC interest. On the other hand, healthcare technology funding has underperformed in years prior, but the industry is gaining technological momentum as decks created climbed 30% YoY.

However, competition for VC funding is becoming more dispersed throughout the United States as founders experience success away from the typical startup hubs. Seed-stage startups in the Western United States dropped 12%, while the Southern United States and Northeastern United States each increased 6%.

Less Time to Make an Impact

Overall, VC time spent reviewing pitch decks at the seed stage dropped 27% for unsuccessful pitch decks YoY, and 12% for successful decks. This difference confirms investors are content walking away from a deal after a quick first glance. Unsuccessful pitch decks saw a 28% drop in time spent on subsequent visits YoY, as investors are quick to confirm their doubts in a pitch deck.

Conversely, founders are spending significantly more time fundraising at the seed stage compared to years past. Some of this increase can be attributed to a worse success rate in securing meetings with investors — the average number of investors contacted is 66 in 2023, up from 48 in 2022, but the average meetings set is down to 38 per startup team, compared to 56 in 2022. With 50% of successful raises taking 13 to 24 weeks in 2023, compared to only 46% of successful raises taking one to 12 weeks in 2022, fundraising has become a more time-consuming and rigorous process than years prior.

Digital fatigue, inflation pressures and sustainability sensitivities impact what consumers want from brands

A study released today by R.R. Donnelley Sons & Company (RRD) revealed that marketers' preference for channels with proven return on investment more than doubled over the past year (38% compared to 15%). The Modern Marketers Report found that economic uncertainty, increasing privacy concerns, and consumer fatigue toward marketers’ digital strategies are driving the resurgence of “tried and true” marketing channels. In addition, managing vendors was reported as a more common top organizational challenge this year than it was in 2022 (23% compared to 7%).

The Modern Marketers Report, the company’s fourth annual marketing industry report, compares 1,000+ US consumers’ purchasing behaviors and preferences and attitudes toward brands’ marketing tactics with how 500+ U.S.-based marketing professionals are planning, executing, and adjusting their strategies.

“During the holiday shopping season, consumers are thinking twice before they open their wallets or provide their personal information to receive deals,” said Al duPont, Chief Commercial Officer at RRD. “Results from our latest report show that marketers pairing their most reliable channels with positioning that blends convenience and savings stand the best chance for fostering customer loyalty in an increasingly competitive market.”

Inflation is influencing how and where consumers spend

The Modern Marketers Report reaffirmed that inflation is changing the way consumers shop, with eight out of 10 reporting that it’s impacting their purchasing behaviors. The majority of consumers (78%) report consolidating their shopping to fewer stores and brands, switching to more cost-efficient brands, and using customer loyalty or reward programs more often. Moreover, while gift shopping for the 2023 holiday season, over 40% of consumers expect to use discounts and promotions more often than last year. Looking ahead, nearly half of consumers expect to spend less on dining out (49%), events, and leisure activities in the next 12 months. In the past 12 months, 74% of shoppers agreed they spent more time researching before purchasing, which shows consumers are also dedicating more time to finding the best products and deals. As consumers become more selective and judicious about their purchases, marketers are challenged with driving customer loyalty.

As consumers grow tired of digital communications, direct mail reasserts its presence

While marketers grapple with cultivating and retaining brand loyalty, consumers report being overwhelmed by digital brand communications, especially via email (69%) and social media (61%). At the same time, one in five consumers report having deleted a social media account in the last year, and nearly half (46%) are more cautious about sharing personal data online. Fifty-six percent report being at least sometimes uncomfortable disclosing personal information online with brands or companies offering rewards or personalized experiences.

With looming privacy concerns, nearly all marketers (93%) report that these growing concerns have influenced their digital marketing strategy. Seventy-five percent report reallocating some of their marketing budget into direct mail.

“Direct mail offers marketers a means to connect with customers and prospective customers in a way that feels intimate without feeling invasive,” said Stefanie Cortes, Director of Strategic Analysis, Direct Marketing, RRD. “This tried-and-true marketing channel serves as a personal and tangible method that continuously proves to perform over time.”

Consumers mirrored this increased interest in direct mail, particularly among the younger generations. Nearly half (42%) of consumers reported an increased interest in receiving direct mail compared to a year ago. Younger generations were most interested in direct mail, with 61% of those aged 18-26 agreeing with this sentiment. Consumers report an affinity toward direct mail because they like having a physical copy of information to refer back to (47%), it being easier to remember than email (30%), and it being fun to open (28%).

Marketers are prioritizing sustainability for future generations as consumer values shift

Nearly all marketers (99%) agreed that their brand’s sustainability practices will become increasingly important as younger generations represent a greater share of the market. Over half of marketers feel that changes are necessary in the areas of quality (61%), value (59%), commitment to diversity/inclusion (56%), sustainability (55%), and stance on political/social issues (42%) in order to keep pace with generational changes. However, marketers overestimated the importance of sustainability on consumer purchase decisions. Gen Z (66%) consumers were not nearly as likely as millennials (80%) to weigh a brand’s sustainability practices when making a purchasing decision. Among Gen Z consumers, the top driving factors when making purchasing decisions include the value of products/services (77%), brand’s reputation (73%), and treating employees fairly (71%).

Net new customers drive Data Integrity Suite sales, expanding Precisely reach into AI and advanced analytics use cases

Precisely, the global leader in data integrity, today announced continued momentum for its Precisely Data Integrity Suite. The company has added dozens of customers spanning data integration, data governance, and geo addressing Suite services, with nearly half of global Suite sales attributed to new customer logos. Precisely is helping companies, such as Belfius Bank, Smiley Technologies, UK Power Networks, and Vantage Towers, to quickly build trust in the data they store in modern cloud and hybrid environments. These organizations use this data in AI, advanced analytics, and other high-value, data-driven initiatives to achieve greater operational efficiencies and improved business outcomes.

“In our ongoing commitment to make data easy to discover, understand and use reliably, we are procuring the Precisely Data Integrity Suite,” said Zachary Decent, Data Governance & Quality Manager, Enterprise Data Management at UK Power Networks, providing power to a quarter of the UK’s population. “This move signifies our dedication to fostering Data Best Practice principles, leveraging this platform to offer stakeholders an enriched experience through a comprehensive data catalog, with clearly defined data responsibilities and robust quality monitoring mechanisms.”

"Smiley's Analytics Services depend on a very high level of accuracy for address validation and location data,” said Chris Raper, Chief Strategy Officer, Smiley Technologies Inc., a provider of core banking software and services for community banks and financial institutions. “Leveraging Precisely Data Integrity Suite has allowed us to seamlessly integrate these services into our overall analytics solution supporting Community Banks.”

Research and consulting firm Gartner® identified data integrity as one of four themes in its recent Hype Cycle™ research^1. According to the report, “AI relies on data, and better data leads to more reliable AI solutions. Without automated support, validating massive volumes of data is impossible.”

“We chose the Precisely Data Integrity Suite because it will provide us with a strong data governance framework that enables us to leverage trusted data across our organization,” said Sascha Glomski, Manager BI & Finance Transformation, Vantage Towers. “As one of the largest operators of mobile towers in Europe, having end-to-end visibility and a better understanding of our data will help us improve operations, reduce costs, and accelerate time to market.”

In addition to customer traction, Precisely added new partner certifications for the Data Integrity Suite this year. With the Suite, organizations can natively run data integrity processes at scale within leading data cloud environments, such as AWS Redshift, Databricks, Snowflake, and more, accelerating analytics where the data resides.

“Precisely allowed us to scale our integrated data governance and data quality program in order to reach our 2025 ambitions,” said Jérôme Sandron, Head of Data Governance at Belfius Bank, a leading Belgian banking and insurance group.

With the Precisely Data Integrity Suite, businesses harness trusted data to improve customer experiences, increase revenues, reduce costs, and mitigate risk. Comprising interoperable cloud services that share a common data catalog and user experience, the Suite gives organizations confidence their data, wherever it’s stored, has maximum accuracy, consistency, and context. The Data Integrity Suite includes Data Integration, Data Quality, Data Governance, Data Observability, Geo Addressing, Spatial Analytics, and Data Enrichment services.

“The strong customer momentum for the Data Integrity Suite confirms that it is essential to deliver cloud-native data integrity processing,” said Eric Yau, Chief Operating Officer at Precisely. “There is a need for trusted data, and we’re here to solve the complexities for business and data teams alike. We have extensive expertise to provide a clear path for businesses focused on achieving faster insights and optimal efficiencies for their organizations.”

Annual cnvrg.io survey reveals majority of organizations are still in the research and testing phase for generative AI

cnvrg.io, an Intel company and provider of artificial intelligence (AI) and large language model (LLM) platforms, today released the results of its 2023 ML Insider survey. While every industry appears to be racing toward AI, the annual survey revealed that despite interest, a majority of organizations are not yet leveraging generative AI (GenAI) technology.

Released for the third year, cnvrg.io's ML Insider survey provides an analysis of the machine learning industry, highlighting key trends, points of interest and challenges that AI professionals experience every day. This year’s report offers insights from a global panel of 430 technology professionals on how they are developing AI solutions and their approaches to applying generative AI to their businesses.

“While still in early development, generative AI has been one of the most talked-about technologies of 2023. The survey suggests organizations may be hesitant to adopt GenAI due to the barriers they face when implementing LLMs,” said Markus Flierl, corporate vice president and general manager of Intel Cloud Services. “With greater access to cost-effective infrastructure and services, such as those provided by cnvrg.io and the Intel Developer Cloud, we expect greater adoption in the next year as it will be easier to fine-tune, customize and deploy existing LLMs without requiring AI talent to manage the complexity.”

GenAI Adoption Trends

Despite the rise in awareness of GenAI technology in 2023, it is only a slice of the overall AI landscape. The survey reveals that adoption of large language models (the models for training generative AI applications and solutions) within organizations remains low.

Three-quarters of respondents report their organizations have yet to deploy GenAI models to production, while 10% of respondents report their organizations have launched GenAI solutions to production in the past year. The survey also shows that U.S.-based respondents (40%) are significantly more likely than those outside the U.S. (22%) to deploy GenAI models.

While adoption may not have taken off, organizations that have deployed GenAI models in the past year are experiencing benefits. About half of respondents say they have improved customer experiences (58%), improved efficiency (53%), enhanced product capabilities (52%) and benefited from cost savings (47%).

Adoption Challenges

The study indicates a majority of organizations approach GenAI by building their own LLM solutions and customizing to their use cases, yet nearly half of respondents (46%) see infrastructure as the greatest barrier to developing LLMs into products.

The survey highlights other challenges that might be causing a slow adoption of LLM technology in businesses, such as lack of knowledge, cost and compliance. Of the respondents, 84% admit that their skills need to improve due to increasing interest in LLM adoption, while only 19% say they have a strong understanding of the mechanisms of how LLMs generate responses.

This reveals a knowledge gap as one potential barrier to GenAI adoption that is reflected in organizations citing complexity and lack of AI talent as the biggest barriers to AI adoption and acceptance. Additionally, respondents rank compliance and privacy (28%), reliability (23%), high cost of implementation (19%) and a lack of technical skills (17%) as the greatest concerns with implementing LLMs into their businesses. When considering the biggest challenge to bringing LLMs into production, nearly half of respondents point to infrastructure.

There is no doubt GenAI is having an impact on the industry. Compared with 2022, the use of chatbots/virtual agents has spiked 26% and translation/text generation is up 12% in 2023 as popular AI use cases. This could be due to the rise in LLM technology in 2023 and the advances in GenAI technology. Organizations that have successfully deployed GenAI in the past year see benefits from the application of LLMs, such as a better customer experience (27%), improved efficiency (25%), enhanced product capabilities (25%) and cost savings (22%).

Intel’s hardware and software portfolio, including cnvrg.io, gives customers flexibility and choice when architecting an optimal AI solution based on respective performance, efficiency and cost targets. cnvrg.io helps organizations enhance their products with GenAI and LLMs by making it more cost-effective and easier to deploy large language models on Intel's purpose-built hardware. Intel is the only company with the full spectrum of hardware and software platforms, offering open and modular solutions for competitive total cost of ownership and time-to-value that organizations need to win in this era of exponential growth and AI everywhere.

According to new study from Merge, B2B SaaS companies must adopt a growing number of product integrations to meet customer demands

Merge, a leading product integration platform, released its first-ever State of Product Integrations Report based on a survey of 260 product managers and engineers.

Organizations are increasingly demanding that their B2B SaaS vendors offer seamless integrations with their technologies, which include accounting, CRM, HR, payroll, project management, recruiting, ticketing, and file storage systems. These integrations (i.e. product integrations) allow organizations to see more value from their B2B SaaS vendor’s product, whether that’s by letting them automatically provision and deprovision users, perform more robust analysis, access up-to-date documents, and much more.

But product integrations don’t just benefit the organizations that use them. According to the report, B2B SaaS companies that provide integrations have found that they’ve helped their business capture revenue in a variety of ways. This includes closing new business (59%), retaining more clients (53%), and expanding into new markets (52%).

Given the benefits that product integrations provide to both consumers and providers, more than 4 in 5 organizations (83%) have identified product integrations as one of their top priorities for 2024—leading them to set ambitious integration targets. For instance, while most (68%) organizations have built less than 10 integrations to date, 50% of organizations want to build 15 or more integrations in 2024, and nearly a fifth (19%) want to build 30 or more integrations.

Organizations, however, may struggle to meet these integration targets. Seventy-one percent say that they take at least three weeks to bring a single integration to market. Based on this pace of development, the prospect of building upwards of 10 integrations in 2024 may fall out of reach—leading organizations to disappoint clients and their go-to-market teams.

“B2B SaaS companies are under increasing pressure to offer a diverse range of integrations to set themselves apart and stay ahead of competitors. But based on our own experience and what we’ve seen in the B2B SaaS market, building and maintaining these integrations in-house simply isn’t sustainable,” said Shensi Ding, Co-Founder and CEO of Merge. “Merge’s Unified APIs can help these organizations integrate at scale; they can simply build once to one of our unified APIs to offer a whole category of integrations. In addition, we handle all of the integration maintenance and provide the necessary management tooling for customer-facing teams—all but ensuring that our clients’ integrations are reliable and performant over time.”

New Research Demonstrates Marketers Open to Experimenting with AI While Influencers Remain Optimistic But Cautious Regarding the New Technology

SocialPubli, the leading global micro-influencer marketing platform, today announced the release of the AI in Influencer Marketing 2023 study, the latest in a series of annual industry reports covering the evolution of the content creation economy through the perspectives of its key players. The global study engaged both influencers and marketers to better understand how AI is impacting and reshaping the industry.

AI is still in its early stages of development but has already impacted essential aspects of influencer marketing, including content brainstorming and creation, influencer discovery and vetting, and campaign performance measurement and analytics. The study's findings indicate that the adoption of AI within the influencer marketing space continues to increase but that there are still areas of uncertainty related to the use of this burgeoning technology.

"Nine in ten influencers report already being familiar with artificial intelligence while half are already using AI to support their work. On the agency side, nearly eight in ten marketers are leveraging AI for work, demonstrating its growing potential to support and enhance partnerships between brands and the influencers they work with," said Ismael El-Qudsi, CEO of SocialPubli. "At SocialPubli, what we've seen is that AI is not only expediting processes but also enhancing campaign effectiveness and opening up new possibilities for creativity and engagement."

When conducting the survey, SocialPubli polled 1,235 influencers as well as marketers from 73 agencies across Europe and the Americas.

INFLUENCERS AND AI

While influencer perceptions of AI vary, the majority of influencers lean toward cautious optimism regarding the impact AI has had on society and on their field of work.

• AI - A Threat or an Opportunity? 71.4 percent of influencers view AI as an opportunity for growth and success.
• Current Use of AI: 51.7 percent of influencers report already using AI to support their work. Top AI uses include brainstorming ideas (45 percent) and generating images, video or copy (34 percent).
• Virtual Influencers: About 30 percent of influencers polled reported following or engaging with virtual influencers.
• Trust and Reliability: In the case of influencers, a majority of them trust the information provided by AI, with nearly 64 percent relying on the data it offers.
• Future Outlook: 36.9 percent of influencers report excitement as their main feeling toward the increased use of AI, while 41 percent report feeling equally excited and concerned.
• Transparency: About two-thirds of respondents said they would disclose the use of AI to their followers, while one-third said they don't consider such disclosures necessary.

MARKETERS AND AI

Marketers typically see AI as an opportunity, using it for various tasks, and emphasizing trust in AI data while advocating for transparency in disclosure.

• AI - A Threat or an Opportunity? 81.7 percent of marketers indicate that they see AI as an opportunity.
• Current Use of AI: The most common uses include social media copy (47.2 percent); generating images or video (38.9 percent); editing (36.1 percent); research (34.7 percent).
• Virtual Influencers: 62 percent of marketers are open to teaming up with virtual influencers, but only 27.5 percent have worked with virtual influencers. Of those that have, 21.7 percent have had positive results.
• Trust and Reliability: 76.1 percent of marketers surveyed trust AI data, indicating their willingness to incorporate AI into their processes.
• Future Outlook: Almost 55 percent of marketers feel more enthusiasm than concern about the rise of artificial intelligence. Only 15.5 percent are concerned or have a negative perception.
• Transparency: 84.7 percent of marketers want influencers to disclose whether they are using AI in sponsored campaigns.

According to El-Qudsi, influencer marketing can flourish with AI, but only when both sides are transparent and communicative about their efforts. "Authenticity has always been a hallmark of influencer marketing," El-Qudsi said. "AI is a technology in development and there are many gray areas to be identified and addressed as it becomes more widely adopted. As the potential for incorporating AI into marketing efforts grows, it will be critical for brands and influencers to agree together on the aspects that matter to them, including transparency in their communication and in their use of AI tools to support their content efforts."

FourthWall, a leader in media audiences and analytics, is thrilled to announce its strategic partnership with DIRECTV Advertising, to include DIRECTV's set-top-box and streaming data from millions of households within FourthWall's Reveal™ Platform. This sets the stage for a transformative era in multi-platform data solutions, enabling greater accuracy for audience targeting and full-funnel analytics, yielding higher-performing campaigns and optimized solutions for brands.

DIRECTV's nationwide scale and deterministic audience is a strong foundation to power insights for marketers of any size across all U.S. markets. Combined with FourthWall's advanced Reveal™ Platform, with its 24-hour turnaround for custom audience creation, instantaneous 1^st party data onboarding, and same-day audience-to-attribution analytics, the partnership will help empower customers' data-driven decisions with unmatched quality insights, speed, and scale.

DIRECTV Advertising plans to use FourthWall's Reveal™ Platform to expand its advertising portfolio with powerful new solutions for its clients and partners. This includes the ability to create customizable audience segments for advertisers, which will enable faster turnaround times to meet market demand in a digital environment.

"DIRECTV's viewership data has always been trusted by our agency and advertising partners to enhance their advertising solutions and yield valuable insights," said Amy Leifer, Chief Advertising Sales Officer at DIRECTV Advertising. "Now, the partnership with FourthWall makes it faster and more seamless to leverage our data across various platforms."

"FourthWall's partnership with DIRECTV Advertising is a significant step forward for the industry," added FourthWall's CEO, Paul Haddad. "Our innovative approach, unmatched infrastructure flexibility, and speed in providing results will now be combined with DIRECTV's impressive scale and precision to benefit all local, regional, and national advertisers."

Moody's Corporation today announced the launch of Moody's Research Assistant. It is the first search and analysis tool powered by generative artificial intelligence (GenAI). The product leverages Moody's extensive proprietary content and the latest large language models (LLMs) to help clients gain new insights from the breadth and depth of Moody's credit research, data and analytics.

As the first commercially available research tool powered by generative artificial intelligence for financial market participants, Moody's Research Assistant synthesizes large amounts of information, allowing users to evaluate lending or investment opportunities quickly and at scale, monitor developments, compare entities and enhance Analyze workflow. Moody's Research Assistant builds on Moody's extensive proprietary content and incorporates the latest generative artificial intelligence technology to enable users to generate more comprehensive risk insights faster.

Cristina Pieretti, general manager of digital insights at Moody's Analytics, said: "For financial market participants, successfully navigating today's complex risk environment requires resource-intensive analysis of large volumes of research and data across multiple risk areas. With Moody's Research Assistant, analysis that once took hours can now be completed in minutes, freeing up more time for strategic decision-making.”

Moody's Research Assistant pilot users reported improvements in their productivity and effectiveness. Based on metrics observed during the pilot, users can save up to 80% of data collection time and up to 50% of analysis time after adding Moody's Research Assistant. Overall, study results show that Moody's Research Assistant saves users up to 27% of time when performing common tasks and functions of a financial analyst.

Moody's Research Assistant is available as an add-on to CreditView, Moody's flagship ratings and research solution. Moody's Research Assistant uses Microsoft's Azure OpenAI service and uses advanced language processing technology to complement CreditView's existing information retrieval system to effectively identify relevant entities, industries and geographic regions in text content.

Moody's Research Assistant covers the latest rating actions, credit opinions and research reports from Moody's Investors Service, providing users with real-time answers. Eventually, Moody's Research Assistant will expand to leverage more Moody's data and content, covering credit, climate, cyber, compliance, supply chain and other risk areas.

The launch of Moody's Research Assistant is the latest chapter in Moody's integration of artificial intelligence into its products, solutions and processes to help decision makers interpret risks and unlock opportunities. Moody's approach to continuous innovation is based on three principles: grow rapidly, empower employees and prioritize customer impact.