G’day, and welcome to this week’s edition of Overnight Success! Your weekly download on all the important things that happened in the Aussie startup ecosystem. 🇦🇺 🚀 

A special welcome to our new subscribers - it’s great to have you here! 👋 

👀 Headlines 👀 

🔀 Federal Treasurer updates the mandate for Australia’s sovereign wealth Future Fund with renewed focus on supporting the energy transition, housing & infrastructure. (The Guardian)

• Australian Government defers drawdowns from the Future Fund until at least 2032-33, introducing a new Investment Mandate and Statement of Expectations while reaffirming commitment to achieving investment returns of CPI + 4-5% over the long term.

• Current investments include $12 billion in infrastructure projects, such as Tilt Renewables, Melbourne and Perth Airport expansions, and data centre developments with CDC. CDC owns and operates sovereign, highly secure and connected large-scale data centres across Australia and New Zealand.

• Future Fund's value has grown from $60.5 billion in 2006 to $229.7 billion as of September 30, 2024, with $169.2 billion in investment returns. (Future Fund Press Release)

👥 There were a few big people moves across the startup ecosystem 

• 👋 Luke Anear steps down from the CEO role of Safety Culture, making way for a new boss based out of the US. (AFR)

• 🤑 Canva brings in a new CFO who knows what it takes to get to IPO. Kelly Steckelberg, oversaw the IPO of Zoom on the Nasdaq in 2019.(AFR)

• ⛔ me&u lays off 10% of its staff. The staff are from the post-merger entity with Mr Yum. This equates to 20 of its 200 staff. (AFR)

• 🧬 UniSA looks to bolster research commercialisation with the hire of serial entrepreneur Dr Michelle Perugini. (Startup Daily)

🦅 Swoop Aero enters liquidation as creditors vote (Startup Daily)

• Drone logistics platform Swoop Aero had raised more than $26M from a slew of investors, including Main Sequence, Giant Leap, In-Q-Tel, Folklore, Right Click Capital, Blackbird and Startmate.

• The company was placed into voluntary liquidation. Creditors will now work to return capital to investors via the sale of IP and assets. 

⚡️ Startup Retro ⚡️

Pronto Pilates lands $1.64M to scale “teacher-less” pilates studios

Founders: Steve Anson and Emma Shelton

Perth-based startup Pronto Pilates has secured $1.64 million in one of Australia's largest equity crowdfunding raises this year. The funds will fuel the company's ambitious plan to open 1,000 "teacher-less" reformer pilates studios worldwide over the next four years, targeting markets in North America, the UK, Europe, and Asia-Pacific.

Founded by Steve Anson and Emma Shelton, Pronto Pilates operates studios offering on-screen classes led by qualified instructors. With 15 locations across Perth, Sydney, Melbourne, Brisbane, and Adelaide—and over 20 new studios in development—the company aims to make pilates more accessible through tech-savvy solutions.

The crowdfunding campaign on the OnMarket platform attracted 488 investors. Some investors included strategics interested in purchasing or integrating studios into healthcare practices.

Pronto Pilates offers over 70 unique on-screen classes ranging from beginner to advanced levels, running 365 days a year from 5:15 am until the late evening. This extensive schedule surpasses traditional studio offerings, making it easier for members to fit workouts in.

Due Diligence: Business News Australia, OnMarket Offering

Australian Droid and Robot (ADR) lands $2M to scale mining robots that can work in hazardous environments where humans can’t 

Founder: Dr Joe Cronin 

Brisbane-based startup Australian Droid and Robot (ADR) has raised $2 million in funding led by Resource Capital Funds to expand the production of its eight-wheeled mining robots. Founded by former Rio Tinto project manager and robotics PhD Joe Cronin, ADR develops robots designed to operate in harsh, dark, and dirty mining environments without interrupting ongoing machinery operations.

The robots, weighing around 30kg and equipped with dozens of sensors, collect critical data and perform measurements alongside active equipment, eliminating the need for human workers to enter hazardous zones. Cronin's inspiration came from his time at Rio Tinto, where operational systems often had to be shut down for inspections. Early attempts to repurpose military robots failed due to the challenging underground conditions, leading ADR to develop its own specialised robots at their Taringa facility near Brisbane.

ADR gained significant attention in 2021 when it deployed its robots into the collapsed Lhoist North American limestone mine in Tennessee. A catastrophic airblast had made the site too dangerous for human entry. Under the guidance of engineering manager Andre Preller and product manager Callum Macdermid, ADR sent ten robots into the mine, enabling it to reopen within a week and sparking interest from other mining companies.

The new funding will support the launch of the "Explora Remote Data Acquisition System", an underground docking station for the robots set to debut in 2025. ADR estimates that its technology could reduce operational costs by 5-7%, as the robots can function alongside active machinery and autonomous systems.

Due Diligence: The Australian 

Raindrop raises Seed funding from 75% NT-based investors to simplify complex policies

Founder: Jasmin Flori-Hess

Darwin-based InsurTech startup Raindrop has closed an oversubscribed Seed funding round to accelerate the development and expansion of its platform for demystifying complex insurance policies. While the exact amount was not disclosed, 75% of the funding comes from Darwin-based investors. Raindrop's focus on securing local investment underscores the company's commitment to the Northern Territory's growing startup ecosystem.

Raindrop specialises in transforming complex insurance policies into clear and actionable insights for insurance professionals. The platform uses semantic policy analysis, standardisation, visual comparisons, and regulatory updates to simplify complex insurance language. As a benefit of faster policy understanding, the focus can be shifted to building strong client relationships and growing business. Users will span brokers, underwriters, and clients.

“As a company rooted in the Territory, we bring unique insights and a fresh perspective to the insurance industry, while contributing to the region’s growing reputation as a technology hub,” said Jasmin Flori-Hess, CEO of Raindrop.

Due Diligence: OS Exclusive

Edexia joins Y Combinator's with $763K of investment for AI tools for teachers 

Founders: Daniel Gibbon and Nathan Wang

Brisbane-based AI education startup Edexia has been accepted into Y Combinator's 2025 cohort, securing US$500,000 (AU$763,000) in funding to accelerate its growth. Founded by friends Daniel Gibbon and Nathan Wang, Edexia offers AI tools that assist teachers with assessments, aiming to enhance the educational experience by focusing on educators rather than students directly.

Opting for Y Combinator over larger $2 million offers from Australian VCs, the founders believe the Silicon Valley accelerator provides the best platform for both company development and personal growth as entrepreneurs.

Since its launch in August, Edexia has partnered with 12 Queensland schools, including Brisbane Grammar and St Margaret's. The startup's AI technology is designed to allow it to "act exactly like a teacher" by learning how to provide feedback under human moderation. This approach enables the AI to handle nuanced assessments across various curricula and tasks.

Edexia plans to use the Y Combinator program as a springboard for U.S. market expansion, citing similar educational challenges worldwide. The company aims to address two key areas for improvement: handling complex, multimodal assessments like videos and physical performances, and making nuanced decisions in subjects such as advanced mathematics and creative writing.

Due Diligence: Business News Australia

New Fund, Who’s this?

💰 Airtree Ventures closes majority of $650 million for two new funds: Core Fund V and Opportunity Fund V (AFR)

• The funds have attracted new institutional investors from the U.S., including Harvard Management Company and the University of Wisconsin, along with returning Australian superannuation funds like AustralianSuper and Australian Retirement Trust.

  • Opportunity Fund V targets investments in established startups and follow-on investments in existing portfolio companies.

  • Core Fund V focuses on backing early-stage startups in their initial funding rounds.

• Airtree's portfolio includes prominent Australian tech companies such as Canva, Eucalyptus, Go1, Immutable, Employment Hero, Linktree, Pet Circle, and SafetyCulture.

• Other major Australian venture firms like OneVentures and Square Peg Capital are also in the process of raising significant new funds.

🌴 Queensland Investment Corporation (QIC) is putting more capital into VC funds including $10M into Virescent Ventures' Climate Tech Fund (AFR)

• With this fresh funding, the Virescent fund has reached $125M of committed capital from 60 investors and is still targeting $200M.

• Other investors include Westpac and the Clean Energy Finance Corporation (CEFC). 

• Originating from the CEFC in 2016, Virescent has deployed over $270 million into 34 climate-specific tech startups, including AgriWebb, Jet Charge, and Zoomo.

💰 Melbourne-based investment firm Boman Group is launching a $1 billion fund to help Australian startups enter the Chinese market (Startup Daily)

• Founded by Eric Gao and Julius Wei in 2011, Boman is setting up an office in Tianjin, China, after partnering with the Chinese Communist Party’s Tianjin Municipal Committee to raise fresh capital.

• The fund will back healthcare, technology, and renewable energy startups in both China and Australia, facilitating expansion in both directions.

• Boman manages around $600 million in assets and has obtained a Qualified Foreign Limited Partner Licence to operate in China.

• Earlier this year, Boman even secured itself a spot on OpenAI's cap table with a $10M investment. Other PortCos include Airbnb, Databricks, and Klarna.

🎆 Wins 🎆 

🛩️ AMSL Aero lands first flight trials of electric vertical take-off and landing (eVTOL) aircraft (Innovation Aus)

• The Vertiia successfully conducted over 50 takeoffs and landings in New South Wales. It's designed to fly up to 1,000 km cruising at a speed of 300 km/h on hydrogen fuel.

• AMSL Aero has already secured deposits for 26 Vertiia aircraft.

💽 Sydney-based quantum computing startup Q-CTRL receives funding as part of a $60 million Federal Government investment to enhance defence capabilities in quantum and counter-disinformation technologies (Startup Daily)

• Q-CTRL is working with the Australian Army to tackle logistical challenges using quantum computing, such as scheduling and routing for 5,000 convoys during the upcoming Exercise Talisman Sabre with the US Army.

Cultured meat startup Vow launches faux fois gras targeting high-end restaurants in Singapore and Hong Kong

• Vow's foie gras comprises of 51% quail cells, plant-based fats, and corn husk flavourings. This offers an ethical alternative to traditional foie gras, which involves force-feeding ducks or geese.

• Despite the breakthrough, the cost of production remains high, ranging from $68 to $10,000 per pound.

• This article by Wired is a fantastic read on fois gras and the cultured meat industry.

🤑 M&A 🤑 

Finder acquires cashback rewards startup Grow My Money (The Advisor)

• Grow My Money was founded by Pascale Helyar-Moray OAM and offers up to 20% cashback from retailers like Appliances Online, Chemist Warehouse, and The Good Guys. Cashbacks can then be deposited into users' mortgage accounts or superannuation funds.

Karmo, established in 2018, has acquired its rival, Motopool, to become Australia’s biggest car subscription business (The Australian)

• Karmo took out a $138 million loan from Toyota and VW’s Venture arms for the acquisition. Additionally, a fleet of 5,000 cars will be added to the roster. 

• Karmo now has the largest fleet of short-term rental vehicles in the country. Subscription costs range from $180 to $700 per week for cars valued between $20,000 and $160,000.

• The company initially started renting cars to Uber drivers but has transitioned to a majority B2C model.

• The model differs from the now-shut-down Uber Carshare or the thriving Turo model, where users rent cars from their peers. In the Karmo model, users rent cars directly from the business in an “all-inclusive” model.

📍 Notice Board 📍 

Our friends at ClimateSalad are hosting the Australian Climate Tech Connect & Awards 2024 in Paddington Town Hall this week!

• This event is a one-of-a-kind opportunity to connect with investors, founders and industry leaders while celebrating the achievements of the Australian climate tech industry in 2024.

• The list of investors and amazing founders attending is too long for this newsletter and promises to be an excellent night for climate tech entrepreneurs, operators, investors, mentors, stakeholders, and advocates.

• Wednesday 27th November 2024, 5 pm at the Paddington Town Hall, Sydney. Grab your tickets here!

Are you an emerging leader in entrepreneurship or investment looking to expand your horizons? Is it time for you to go to Harvard?

• The Harvard Club of Australia (HCA) offers two exclusive scholarships designed to elevate your knowledge, experience, and connections within the prestigious Harvard community in Australia and abroad.

• Applications open on 18 November and close on 11 December 2024. Apply here.

Would you like to promote an event or an opportunity here? Enquire about a noticeboard promotion here.

🧠 KaaS (Knowledge as a Service)

Gem’s Pick 💁‍♀️ Foundering - The OpenAI Story by Bloomberg

• One to queue up for your summer road trips - this 6-part series is a blow-by-blow history of how OpenAI came into existence, through to the present day. It’s amazing how much has happened in a relatively short space of time and really made me fast forward to the day I can imagine 90 year old Gemma telling my grandchildren “I was alive when they released ChatGPT”. It really is history in the making, and it’s safe to say it’s both fascinating and terrifying all at once.

Will’s Pick 💁‍♂️ Do People Actually Hate 'Forrest Gump'? A Statistical Analysis by David Parris

• While not startup-related, I enjoyed this analysis of what people think of Forrest Gump. It’s fascinating how the author notes the change in ratings over time and how it compares to other Oscar winners. Interestingly, he comes to the conclusion that Forrest Gump is actually a pretty loved film, despite thinking it was very disliked. Turns out it was just the group of people he was spending a lot of time with! Enjoy!

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‘Til next time,

👋 Will & Gem

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