Software solutions are enduringly popular with investors and users alike. Although B2B software may not be the buzziest of all startup sectors, it’s generally a reliable market and one that’s projected to reach $1,228.87 billion by 2032.
However, the way that SaaS companies can create value with clients is changing. A recent poll from CIO.com found that buyers are concerned they have over-invested in solutions and are looking to consolidate vendors.
This means that SaaS companies will need to clearly demonstrate their purpose with target buyers. Vertical SaaS products that offer industry-focused solutions that not only span functions, but also have industry-specific features and benefits, are likely to rise to the surface in 2024. This is thanks to their ability to provide more value by supporting and enabling users to be productive and more competitive in specific industries.
Meanwhile, SaaS companies that also harness the power of AI can better serve the needs of customers and meet the expectations of Gen Z and millennials’ desire for seamless software adoption.
LA-based Pitbull Ventures is betting on these trends with a $5M fund that will specifically support vertical SaaS startups that are AI-enabled.
An injection of capital for early-stage vertical SaaS startups
Pitbull Ventures is on a mission to take LA’s tech scene to new heights by betting on pre-seed AI-enabled vertical SaaS startups. Recently closing its $5M Fund I, the fund is now ready to fuel the growth of pioneering startups in the region. Given the recent funding winter, this will represent a welcome injection of capital.
Founder and Managing Partner at Pitbull Ventures, Brad Zions, said, “The launch of our new fund’s closing is thanks to the unwavering dedication of our investment team and the support of our amazing LPs. Now, we’re eager to get into Los Angeles and uncover founders working on the most interesting vertical SaaS solutions across industries that need venture backing in 2024.”
Aside from venture capital, startups that are selected by Pitbull Ventures will also be able to tap into the support of the fund’s expert team. They are especially interested in startups that demonstrate promising early traction and are ready to be guided toward the next stages of growth.
Zions has a track record of working with promising early-stage vertical SaaS startups, including Harri, VidMob, and Embrace. More broadly, the Pitbull Ventures team has invested across a variety of SaaS industries, giving the fund a much broader reach, with its portfolio of 15 vertical SaaS early-stage startups.
Driving the growth of LA’s tech scene
LA is now the third-largest startup market in the United States and, with nearly 4,000 venture-backed startups, the area more affectionally known as “Silicon Beach” is quickly catching up to the established tech scenes in the San Francisco Bay Area and New York.
Zions, who has been an active early-stage investor for the past 25 years, founded Pitbull Ventures in 2021 to provide dedicated support to early-stage ventures in the region.
With a focus on AI-enabled industry-vertical SaaS startups with an early product market fit, the availability of a new funding source is important news for pre-seed and seed-stage founders looking for funding during the biggest downturn in venture capital activity for five years.
More information on the $5M Fund I can be found on Pitbull Ventures LinkedIn page.
