CHART OF THE WEEK 📈
In today’s chart of the week, we look at the pace of EdTech funding in the equity crowdfunding market from 2019 through 2023.
From 2019 to 2020, we see a 9.95% rise in funding for EdTech startups. From 2020 to 2021, funding dropped by -4.65%. And 2021 to 2022 saw a rise of 2.04%.
Funding for EdTech startups in the ECF (equity crowdfunding) has remained relatively stable in the last few years. However, 2023 has seen a slow start in funding, with just $1.7M raised this year.
This could coincide with the release of ChatGPT in late 2022. Students find that free AI platforms can provide significant value, and the hype surrounding new and innovative educational offerings has become less impressive.
We have also seen this in the public markets, with Chegg’s stock price getting slammed earlier this year after admitting to losing market share to companies like OpenAI.
However, Chegg stock has sharply risen after discussing further collaboration with services like ChatGPT and ScaleAI, aiming to provide value that the free ChatGPT model can’t.
We saw earlier this year that investors would throw money at companies touting “AI.” Nowadays, investors are perhaps using more caution at these types of claims and the impact of AI on the market in the long run.
Demo Day: Join us for KingsCrowd’s inaugural pitch event!
Our first-ever KingsCrowd Demo Day Livestream is just 2 days away – and we want you front and center!
When: Wednesday, August 23rd at 12pm ET/9am PT
💡 Get exclusive insights from groundbreaking companies:
Avadain: Leading a potential graphene revolution
Build Club: Transforming construction with modular techniques
Legion M: The fan-owned entertainment powerhouse reshaping media
Plus, enjoy a fireside chat with our CEO, Chris Lustrino, and have your say in real time during the Q&A sessions.
PITCH REVIEW 💸
Brief: Leveraging innovative microencapsulation printing, the Smart Cups technology allows for the liquidless transport of goods. Having collaborated with UCLA, Smart Cups has gained attention from notable outlets such as Time Magazine, Gordon Ramsay’s Food Stars, Forbes, and ABC 7. It’s currently raising $1,234,999 at a valuation of $10.65M with a minimum investment of $250.
Key People: Founder and CEO Chris Kanik
Not an Edge Member yet? Unlock the Ratings 🔓📈
Here's what we like: The company's patented delivery system platform, utilizing microencapsulation printing, eliminates the need for liquid in its products. This promotes sustainability by reducing waste and offers unique advantages in transportation and storage.
The company's collaboration with UCLA further solidifies its credibility and potential for future growth. By leveraging the expertise and resources of a renowned institution, Smart Cups can continue to advance its technology and expand its product offerings.
Smart Cups' contract with Company Pet Brands could bring millions of dollars in revenue in the next few months if the product interests customers. If the deal were a success, Smart Cups' current valuation of $10.65 million would appear like a discount.
Here's what we don't: The company has experienced negative revenue growth of -45% in its most recent fiscal year. This decline in revenue raises concerns about the demand for Smart Cups' products in the market. Additionally, the company's annual revenue of $216,510 is relatively low, especially considering its valuation of $10.65 million. This suggests that the company may be overvalued, making it difficult for investors to realize significant returns.
Furthermore, Smart Cups' burn rate is a cause for concern. The company is burning $40,000 monthly, a significant amount considering its limited cash. With only $150,000 available, Smart Cups may struggle to sustain its operations and meet its financial obligations depending on the amount it raises on StartEngine. If the company cannot generate sufficient revenue or secure additional funding, it may face liquidity challenges and potential insolvency.
Would you invest in Smart Cups?
ON THE POD 🎙️
In this episode of the Inside Startup Investing podcast, Chris Lustrino is joined by Alli Schaper, the co-founder and CEO of SuperMush. They discuss Alli's personal journey and her deep connection with functional and psychedelic mushrooms. Alli shares how these experiences inspired her to start Supermush, a company focused on making mushroom-based products more accessible to the public. Despite being in an emerging and competitive market, Supermush has rapidly gained significant traction. Alli provides insights into the company’s strategy, operations, challenges, and future plans.
Listen to the full episode here
TOP-RATED DEALS 🌶️
Popoca, a Salvadoran restaurant in Oakland, California, offers traditional Salvadoran cuisine, including progressive dishes like pupusas and tamales. The food at Popoca is crafted from fresh, high-quality ingredients and is cooked over a wood fire. It has received attention from notable publications, including SF Chronicle, Eater SF, and Bon Appetit Magazine.
Valuation: $2 million
Minimum Investment: $100
BIB Technologies has crafted a patented smart shelf technology, paving the way for temperature-regulated mobile storefronts. These innovative, self-sustained refrigerated storefronts are ideal for marketing at busy events and venues. Collaborations with major names like Red Bull, Liquid Death, and PATH Water highlight the company's success, with plans to penetrate further markets.
Valuation: $18 million
Minimum Investment: $101
Square Baby offers a subscription-based service focusing on daily nutrition and allergen introduction. Aiming to counter the prevalent sugar-laden baby foods, Square Baby emphasizes tasty and nutritionally balanced products while potentially mitigating food allergy risks. Their robust business model boasts a remarkable 79% retention rate and a 75% product margin.
Valuation: $8 million
Minimum Investment: $100