G'day and welcome to Overnight Success. A warm welcome to the 69 new subscribers that have joined since the last edition! You've just joined 1,122 other legends learning about Aussie start-ups.

Drinks on the 9th!

We're organising drinks in Melbourne, and you're invited! Make sure you register to attend via the Humanitix event so we save a spot for you. We'll catch up at Harlow (beer garden at the back) for a few brews from 5:30pm onwards on Thursday 9th of Feb. Reach out if you'd like to support the event!

Headlines:

• 🤝 Artesian scores a win-win partnership for the Aussie & Japanese startup ecosystems. (LinkedIn Announcement)

  • Japan’s biggest financial institution, Mitsubishi UFJ Financial Group, Inc. (MUFG Bank) has signed and MOU with Artesian Investments to support MUFG Bank in accelerating its business development into Australian innovations.

• 👋 Salesforce Ventures sails away from Aus.

  • After only 4 years with boots on the ground in Aus, Salesforce Ventures recently made it’s lead local operator redundant leaving no-one Down-Under to actually consider local deals. (AFR)

  • Despite this, Salesforce says they will continue to manage their Australian portfolio and seek new investments from the US. This follows a trend of US-based investors retreating from the Aussie market (per Cut Through Venture data).

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

2. Notice Board: Signposting key events and opportunities.

3. Vibe Check: Status update on thoughts and feelings across the ecosystem.

4. Wins: Highlighting wins, big and small.

5. Accredited Tweeters: Snippets from mostly Aussie start-up Twitter.

6. (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⚡️

Quantum Computing

  💽 Q-CTRL lands $39M to take technology worldwide

Q-CTRL, a Sydney-based quantum computing company, has raised $39M in an extension of its 2021 Series B. The round was led by Salesforce Ventures and included Main Sequence Ventures, Ridgeline, ICM Partners and Airbus Ventures, among others. The total for the Series B is over $52M USD, a positive sign for the ecosystem as Q-CTRL's valuation increased. So what is Q-CTRL? The start-up brings the power of quantum computing to everyone. For example, a large enterprise user with huge computational challenges, like a finance company or pharmaceutical company, will see errors in the data due to the sheer volume of calculations. Q-CTRL's technology improves the quantum hardware utility and performance by helping fix these hardware errors. The capital will be used to grow the international team across Sydney, LA and Berlin from 80 to 120. The platform has circa 8,000 users and has ticked over $15M in revenue. Big ticket customers include IBM, Capgemini and Transport NSW.

To democratise quantum computing for all, Q-CRTL has built an EdTech platform specialising in teaching quantum computing called Black Opal. Check it out if you want to take on what could be Australia's next industry. The CSIRO has stated that by 2045 the quantum industry could employ more than oil and gas with a run-rate of $6B a year.

Due Diligence: AFR, Start-up Daily

Employee Success / HR Tech

🧑‍🤝‍🧑 Fingerprint for Success closes $5M Seed round to develop its AI Performance Coach

Sydney-based start-up Fingerprint for Success (F4S) has raised $5M in funding in a round led by Investible. Co-investing in the round were Five V Capital and Salesforce Ventures. F4S brings AI coaching services to enterprise and small business teams via its software platform, Marlee. This latest round brings the total raised to $9M and will allow the firm to build integrations with commonly used applications like Slack and Zoom. The real differentiator of the platform is using decades of research from behavioural data scientists to build a human analytics platform that focuses on wellbeing, happiness performance, diversity and inclusion. F4S has left their fingerprint on over 20,000 organisations and scales nicely as businesses grow, pricing per month per user. The platform has some impressive clients like Atlassian, Hubspot, AWS and Canva.

Due Diligence: Overnight Success

FinTech

💵 Hnry closes $35M Series B to help sole traders manage finances

Hnry, a New Zealand-based accounting software provider for sole traders, has closed its $35M Series B. The company offers a digital accounting platform that takes care of tax lodgements, payments, invoicing and expense tracking. It operates on a pay-as-you-go model with on-demand, in-person customer support. AirTee Ventures led the investment, with Athletic Ventures and Left Lane Captial coming in. This round brings Hnry's total funding to $53M since it was founded in 2016. Left Lane Capital led its Series A with EVP leading its Seed round, according to Crunchbase. The company was founded out of frustration with how long it takes sole traders to manage their financials and submit tax returns. Hrny has spat out some impressive growth, touting tripling its revenue and 4x'ing its customer base in the past year. The NZ company has its sights on Australia, recently opening a new office set up in Sydney with 25 employees. This satellite team is supported by 55 team members in Wellington, which is likely to double in the next 12 months. The pricing costs 1% of a sole trader's income, caps out at $1500, and even tax-deducts itself when filing.

Due Diligence: AFR & Stuff.co.nz

Consumer

🦱 STRAAND secures $2M seed round to grow hair and business

STRAAND, a hair care business that improves the scalp microbiome, has secured a $2M pre-Seed. Unilever Ventures, the venture arm of consumer goods multinational Unilever, led the round. Unilever has large consumer brands under its umbrella, including Dove and Sunsilk. STRAAND was founded in 2022 and challenged conventional hair care products with its prebiotic scalp-balancing products. STRAAND is Australian-made, vegan and cruelty-free. Its primary differentiation is a trademarked element called Defencescalp tries to fix dry and itchy skin, which can cause dandruff. The capital will be used to expand into new markets like the US, UK, Europe and China.

Due Diligence: Business News Australia

MedTech

🏥 CurveBeam AI raises $25M to assess bone fragility in over-subbed pre-IPO

CurveBeam AI, a bone fragility imaging company, has raised $25M with investment from Tenmile. The company was formed in 2022 when CurveBeam and StraxCorp merged. StraxCorp was spun out of Melbourne University. Now, the company combines artificial intelligence and deep learning with its diagnostic cone beam CT imaging solution to help in orthopaedics and understanding bone health. The global operations include product development, manufacturing, sales and marketing, are based in Pennsylvania, USA, while the corporate office in Melbourne covers AI R&D, finance and IP functions.

Tenmile (Andrew Forrest's investment firm) was joined by Firetrail Investments and billionaire Brian Flannery's Ilwella and Karst Peak Capital. The round is marked as a pre-IPO round and was originally pegged at $15M, but it was over-subscribed due to strong investor interest. The focus will be on distribution via partners like Styker in the US and Europe. If all goes well, the company will list on the ASX in late 2023.

The business model is two-fold. First is the physical CT scanners manufactured and sold to orthopaedic clinics. Ongoing revenue comes from AI reports, which will be sold to surgeons at tasty 90% gross margins.

Due Diligence: AFR

Wholesale Food / Marketplace

🦐 FoodByUs satisfies with $12M Series B

Australia's largest wholesale food marketplace, FoodByUs, which services restaurants, has closed a $12M Series B. Base Capital led the round. FoodByUs connects restaurants with wholesale food and beverage suppliers while integrating with Xero to stay on top of costs and to invoice in real-time. The marketplace now hosts 3000 suppliers in Australia, representing 60% of the market. With such a large slice of the wholesale pie, FoodByUs can give restaurants lower prices due to their pricing power. On the other side of the market, over 1200 restaurants are signed up already, and there was impressive growth in 2022. The capital will be invested in the product team and sales and marketing division. Existing investors Macquarie Capital, F J Labs, and Trawalla Group also participated in the round. Interestingly, the website highlights 'FoodByUs for Home', which could unlock a huge new market in the future.

Due Diligence: AFR

MedTech

🛌🏽 Lenexa Medical lands $1M Pre-Series A funding to monitor patients better

Lenexa Medical, a MedTech start-up, has locked away $1M Pre-Series A funding led by Stoic VC. The company's mission is to save the world (or at least Australia) from one of the most overlooked yet dangerous villains: pressure injuries. According to Lenexa, 300,000 pressure injuries occur annually in Australia and are estimated to cost the healthcare system billions of dollars, on top of the harm caused. To combat this, Lenexa has created LenexaCare, an intelligent sheet that attaches to standard mattress and monitors a bed-bound patient's risk of pressure injuries. Pressure risk assessment is performed by manually rolling and visually inspecting at-risk areas by trained healthcare providers. The funding will help with the rollout into hospitals and aged care facilities across Australia. The global TAM is large, with 2.5M pressure injuries annually in the US alone.

If you're a founder or investor who has just closed a round, please reach out to us at [email protected]

Notice Board

• Calling all emerging tech founders who identify as women 👊

  • The Stone & Chalk IWD Scholarship is open! If you are a founder outside of Stone & Chalk's resident community then apply now.

  • Applications close 5pm AEDT February 23rd. 

• LaunchVic is on the hunt for the next wave of #tech unicorns! 🦄

  • Expressions of interest for Cohort 2 of their 30X30 program are now open!

• Know a young (18-25 y.o.) person with bright ideas? Enter Blackbird Protostars 🌟

  • Protostars offers grants of up to $1000 to eligible applicants to explore their passion projects. Applications close 20th Feb. Read the FAQs here. 

• An opportunity for deep-tech start-ups to make a splash 🤓

  • Cicada x Tech23 is an annual festival celebrating radical innovation and brave ideas from the world of deep tech.

  • 23 companies are selected and put in front of an audience of influential people from across the ecosystem. Apply to be one of the 23 before 12th April.

• Not another jobs board - handpicked startup & VC jobs, just for you 💼

  • Aussie VC jobs selected by Oliver Bazzani (WA startup legend) here.

  • Start-up Marketing & Growth roles picked out by Gem here.

Have something to put on the Notice Board?

We're always looking for upcoming events & opportunities across the Aussie start-up ecosystem - reach out to [email protected] to add yours!

Vibe Check

As always, Jessy Wu has her finger on the Aussie startup & VC ecosystem pulse (see: LinkedIn post) and brought this article to our attention this week. A Medium article by the defamed investor Elaine Stead. If you’re not familiar with the story, read this article from David Swan in The Australian.

Wins

• ❤️️ Humanitix: For-purpose ticketing platform Humanitix donates another $1M of booking fees to children's charities.

  • The company has donated $2.5 million to charity to date, completely disrupting the traditional ticketing platform business model. Humanitix won the Google Impact Challenge in 2018 and has since become one the fastest-growing ticketing platforms in the US, Australia and New Zealand.

  • To date, the company has been funded by the Foundations of Google and Atlassian.

• 📣 Earlywork: Reaches 5000 subscribers and launches their first Earlywork Academy cohort, including announcing multiple local business partners like startup Ofload.

  • OS spoke to the team in mid-2022 when they alluded to their future monetisation plans - now the proof is in the pudding. This team is exciting.

Accredited Tweeters

(KaaS) Knowledge as a Service

• 💰 Start-up program credits and discounts every startup should be taking advantage of today.

  • This is the most amazing LinkedIn post (& comment thread) to save your startup $1000s thanks to Elena Verna.

• 🤔 Alan Jones (the nice one, albeit with sage advice) makes a case for aspiring founders to try out being operators first (via Startup Daily).

  • “If Australian startups have just one perception to solve, it’s this one: most of us want to start out as either the head chef or the restaurateur.” What do you think?

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Cya next time,

👋 Will & Gem