💌 Aussie Start-up & Venture Capital Summary! 10th of December

G'day and welcome to Overnight Success, the newsletter that quenches your Australian start-up thirst. A warm welcome to the 12 new subscribers that have joined since last week! You've just joined 857 other legends learning about Aussie start-ups.

World Cup Update: Croatia has knocked out Brazil, and Messi's Argentina just beat the Netherlands. Argentina will now play Croatia. Morocco plays Portugal tomorrow at 2 AM and England takes on France at 6AM. 

Headlines: 

• 💰 Square Peg invests in Rokt again for the 6th time, this round at a $3.5B pre-IPO valuation. (AFR)

  • Deeper look below. 

• 📊 Cut Through Venture released its November report. 

  • Highlights: November saw 44 deals with a total investment of $638M, down from November 2021 where we saw $1.3B invested.

  • 📋 The annual State of Australian Startup Funding report is due out in 2 months (we’re excited…!). You can help the team with your insights by participating in their surveys as a startup founder or investor.

• The crypto-crash continues as Brisbane fintech Digital Surge, a cryptocurrency exchange, enters voluntary administration. (Startup Daily)

1. Start-up Retro: Australia's start-up raises with a smidge of context.

2. Aussie Raisins: Start-ups looking to raise some money.

3. Notice Board: Signposting key events and opportunities.

4. Accredited Tweeters: Snippets from Twitter.

5. (KaaS) Knowledge as a Service: Articles to make you smarter. Or to share with co-workers to make them think you’re smart.

Start-up Retro 

E-commerce

💰 Rokt hits $3.5B valuation as Square Peg reinvests

Rokt, a Sydney-based software company that helps e-commerce businesses unlock more revenue, has increased its valuation to $3.5B. The extra funding comes during a challenging funding environment and shows investors are still happy to back with conviction. The revaluation was not a traditional fundraising round; employees and investors sold their shares to new investors. Included in this share sale was Square Peg Capital which has now made its 6th follow-on investment into Rokt. Wellington Management was another investor in the round. Rokt was founded in 2012 and helps e-commerce businesses get larger order sizes by recommending additional products or services as they purchase. Retailers see the number of items in the basket and order value increase after using Rokt. Although the start-up is headquartered in New York, the R&D team operate out of Sydney. Rokt has been profitable for years and has a strong balance sheet, so the secondary share sale allows early-stage investors and long-term employees to liquidate their upside. For context, Series A investors may have just locked in a 20x return while firms like Square Peg continue to invest. Square Peg led the $8M Series A back in 2013, which looks delicious now. 

Due Diligence: (AFR)

Infrastructure / Built Environment

Trendspek ticks off $6.3M Series A

The real asset modelling software start-up Trendspek has secured a $6.3M Series A to accelerate development and increase headcount. The real estate tech investor Taronga Ventures led the round with help from IAG Venture and Firemark Ventures. Trendspek has developed Precious Asset Intelligence (PAI) software that creates a 3D model of real assets. With Trendspek, inspections can be conducted in hours rather than days at a much lower cost. Impressively, the 3D models are generated using drone footage which cuts down on costs, safety incidents and time. Hard-to-reach or very expansive assets are perfect for Trendspek's technology. Think about mobile towers, factory roofs or train tracks. IAG VC leverages Trendspek and other investments to de-risk its insurance portfolios. 

Due Diligence: (Startup Daily)

AgriTech

🗼Zetifi secures a $12M Series A with Telstra coming on board

Digitisation of farmland has one key issue; high bandwidth information exchange. Zetifi, an AgriTech start-up, provides long-range Wi-Fi coverage extensions across farmland. This 'last-mile connectivity' eliminates coverage gaps by extending 4G and satellite networks. Why does a farmer need Wi-Fi in a paddock in rural NSW? They're not on Tiktok… well, they might be. But this connectivity allows autonomous equipment to work, farmers to access the internet while working and connect with other smart devices embedded across vast properties. The funding was led by Telstra and GrainCorp Ventures (with their new $30M fund). Cultiv8 Funds Management, the Grains Research & Development Corporations fund (GrainInnovate Fund & Artesian), also invested in the round. Zetifi rolled out of Telstra's old start-up accelerator in 2019 and has stayed in close contact. Telstra has been impressed by the progress and will also help add value to its telecom network and technology R&D teams. 

Due Diligence: (Sheep Central)

InsureTech

🧈 Butter secures a smooth $1.3M to help you cover your prized possessions

Butter Insurance allows customers on e-commerce platforms to add insurance cover to items as they purchase them. The pre-seed funding comes following Butter going through the Startmate Winter22 accelerator program and has attracted investors, including Flying Fox, Quokka Ventures and FB10X adVentures. The software is signed to be plug-and-play for retailers who don't have to worry about complex insurance issues. Butter handles everything. The retailer can then offer insurance on their products, currently electronics in the $500-5000 range. Presently, the platform can only quote for single items at a time but will look to offer bundles in the new year. So you can grab a single policy for your iPhone and Airpods. The raise also follows an integration with Australian Payments Plus (AP+). This partnership will see Butter integrated into the eQR digital marketplace being developed by EFTPOS. 

Due Diligence: (Smart Company)

Call Centre / B2B Software

📞 Operative Intelligence raises $5M to help contact centres with AI 

Based in Melbourne and Los Angeles, Operative Intelligence has closed a $5M round led by Bonfire Ventures. The company was founded in 2019 by two brothers who have spent 25 years working in customer service and contact centres. The software can improve automated inquiries, which cuts down on wait times. The premise of the software came from their search for optimisation in real call centres. The "5 Whys" process (we'll link to it at the bottom of the newsletter) allowed them to understand the root causes of problems. The business could take action on these problems, reducing the total number of calls in. Companies at scale or scaling fast have needed help understanding their customer's issues to solve them adequately. Operative Intelligence provides that automated data collection tool across calls, emails, chat and social media to create reports on root problems. By the numbers, implementing Operative Intelligence has reduced call volume by 32% or displaced call volume into lighter touch digital channels. The capital will be used to develop the technology stack further and implement AI into the platform. 

Due Diligence: (Tech Crunch)

Med-tech

💉 Vaxxas gets a $34M injection of new funds to shake up vaccination methods

Brisbane-based med-tech company Vaxxas is making vaccines needle-free, replacing them with a patch with thousands of vaccine-coated microinjections applied to the skin for a few seconds. The new financing allows them to accelerate the clinical trial process and commercialisation. The company's innovative patches are superior to traditional needles in many ways. For example, they improve vaccine efficacy, avoid the need for cold transport and storage by remaining stable at 25 and 40 degrees celsius, and are more affordable if rolled out at scale. All of these factors mean these patches can enable the widespread rollout of vaccines to all people worldwide. The $34 million round added to an existing grant of $8 million from the Federal Government in September and was led by existing investors OneVentures and UniQuest and supported by several individual investors, including board members and management personnel.

• Want to see how the little vaccine patches work? Here's a 25-second video explainer.

Due Diligence: (Smart Company)

AgTech

🚰 Farmbot almost closes $5M Series A+ led by Telstra 

The AgTech start-up Farmbot has almost closed its Series A with a $2M cheque from Telstra. It's been a busy week for Telstra, who think it's an excellent season to invest in Agriculture start-ups. Farmbot is an IoT and precision agriculture company that gives real-time updates on resources and water ecosystems. The Farmbot platform is used by 3000 properties in Australia, with an ongoing pilot program running in the US. The US product will launch with a culturally appropriate name, Ranchbot. For many farmers, real-time updates on their water levels are critical data that is key to day-to-day decision-making. The product suite includes water level sensors, flow meters, pressure sensors and rain gauges. Importantly, collaboration with Telstra enables Farmbot to get to market with new products faster. 

Due Diligence: (Smart Company)

eCommerce

🛒 Sortd snags $1.26M to organise your online shopping 

Suppose you're in the midst of Christmas shopping right now, with 100 tabs on your computer, another 100 product screenshots on your phone, and a text message conversation with your family to avoid gift double-ups. In that case, you will understand the problem Sortd is trying to solve. The female co-founded company recently finished the Antler accelerator program with $1.26M in funding from Antler and several private investors, including ELMO Software's chief commercial officer, Darryl Garber. The team has grand plans to turn Sortd into an all-in-one solution for browsing and to shop online. The vision is to bring currently disjointed mobile, desktop and in-store shopping experiences into one platform where customers browse, decide, buy, return or exchange, track and share their purchases. They're also looking to expand the social sharing features of the app, in particular leveraging the influencer marketing boom. Retail partnerships with major e-commerce brands are firmly in their sights as a primary growth strategy.

Due Diligence: (Smart Company)

3D Printing

🧰 Additive Assurance builds for the future with $4.1M of fresh funds

Just three years after being spun out of Monash University, Additive Assurance is proving it has what it takes to fend for itself in the private market. Additive Assurance has raised $4.1M in a round led by Significant Capital Ventures (SCV) and supported by Hostplus and existing shareholders IP Group Australia and Monash Investment. The applications for the company's technology include aerospace and advanced manufacturing industries that use 3D-printed metal parts and need to ensure the high quality of their production. The insights of the tech can solve critical pain points for manufacturing companies and reduce time, cost and waste. According to AusTrade, "advanced manufacturing accounts for around half of Australia's $104 billion annual manufacturing output and is one of the fastest growing export sectors",... so they might be onto something here!

Due Diligence: (Startup Daily)

Med-Tech

🩸Lighting fast blood test results score Microbio $3.5M

If you find yourself with a bloodstream infection, you're in a race against time. Without urgent care, survival rates fall within hours, and yet, unfortunately, until now, traditional blood testing technology has required between 12 hours to 7 days to return results. Microbio's incredible technology can return results within three hours of taking a sample, substantially increasing survival rates and reducing recovery time. We only need to look at the pressure placed on hospital systems in the wake of the pandemic to understand the significance of any technology that can provide greater efficiencies in our healthcare system. The company is looking to commercialise the diagnostic tool and sell it worldwide. Already approved for use in Europe and the UK, sign-off in India and South America is expected in the coming weeks and in Australia by mid-2023. Their fundraising, including investment from CJ3 Capital and eminent scientist and Gardasil co-inventor Professor Ian Frazer, will allow them to roll out the product across international markets.

Due Diligence: (Startup Daily)

If you're a founder or investor who has just closed a round, please reach out!

Aussie Raisins: Companies Looking To Raise

• WizButler is looking to raise between $5-10M  (AFR)

  • WizButler suggests it has an algorithm that can more efficiently allocate tables at a restaurant, unlocking around 50% more bookings in real time. 

  • The business model is to charge restaurants a monthly fee of $99 plus $0.05 per customer.

• SongTradr looks to lock in it’s Series E (AFR)

  • LA-based Australian B2B music licensing marketplace, Songtradr has had a wild last couple of years. Basically, SongTradr better connects Brands, Agencies, artists and music labels.

  • Here's the short version of the story: After a $30 million Series C (at a US$165 million valuation) in August 2020. They focused on growth via the acquisition of music-focused tech businesses. In June 2021, it reached a valuation of more than $397 million (AUD) after securing $66 million in a Series D funding round. 

  • The company was reportedly gunning for an IPO in March this year, only to put a pin in those plans in light of market changes. 

  • Instead, they set out to raise their Series E - initially looking for US$170mill at a ~$500mill valuation. In October this year, the company decided to cut its valuation by ~17% to attract new investment and is now only seeking US$40mill at US$370. 

  • Despite a rougher funding environment, the company is growing well with a recent acquisition of the German AI-based metadata and music search company, Musiccube. This acquisition granted SongTradr more than 50M song titles compared to the 1.5M it had at the time of its Series D. 

Want a small insight into how complex the world of music licensing can be (and why tools like this need to exist)? The OS team recommends listening to this podcast episode of Acquired on Taylor Swift's music empire - your mind will be blown.

Notice Board

• Startmate Athlete Fellowship applications are now open. Find out more & apply here. 

• Speaking of sport… The Australian Open is supporting startups solving large problems in sport, health and entertainment to build, test or pilot on the world stage with the support of Tennis Australia and their fund Wildcard Ventures.

  • Application deadline is the 14th of December, so bring out your aces and start swinging. 

• AWS Clean Energy Accelerator 3.0 is now taking applications from mature startups in clean energy and climate tech.

  • Applications close 1st Jan 2023 - don’t wait until you have a hangover to submit yours…! 

• Airtree Explorers Program to learn about angel investing is taking applications here for the Feb start.  

• Looking for a new gig in 2023 (or know someone is?). Here are four places to find one with an awesome Aussie or NZ startup:

  • Earlywork: join this community for young people interested in tech, startups & social impact to get access to free events & career resources, and build relationships with other Earlyworkers!

  • Startmate Talent Engine: recently launched and is absolutely free to create a profile and start searching!

  • My Start-Up Gig: Over 2,491 Australian start-up jobs across 573 Aussie companies are currently listed.

  • Venture Capital Careers lists all the Australian Venture Capital Jobs available here. There are currently 4 opportunities. For the New Zealand VC Jobs, head here. 

• Are you an active Angel investor? Fill in the State of Australian Start-up Funding Angel Investor Survey here.  

Accredited Tweeters

Want to understand what an investor sees in a company? Check out VCinsights, which aggregates VC investment momos from around the world. 

(KaaS) Knowledge as a Service

• Why Product Market Fit Isn't Enough by Brian Balfour. The first of a 5-part series on how to grow a $100M+ company.

• Some thoughts on "5 Whys" by Jason Yip.

Have I missed something? We love emails so send one over!

• 🦤 Find me on Twitter

• 👔 Holler on Linkedin

• 💌 Email

• 🚀 Sponsorship Opportunities with Overnight Success