Welcome to the June edition of my data-centric newsletter covering Australia and NZ startup fundraising, packaged to drive insights. A special welcome to the 137 subscribers who joined in May – and a big thanks to those who referred them.
Soon I'll be launching a 'friends of a founder' discovery tool. If you're in the business of providing services or capital to startups, add your details here to be included in the Beta release.
You'll find two early-stage startups eager to connect with angels and early-stage investors at the three-quarter mark of today's newsletter. Reach out – they won't bite!
June asks: 1) Next month is the Cut Through Ventures Half Year Review. Help strengthen the dataset by replying with any 2021 deals I've missed. 2) Invite just one friend to subscribe to Cut Through Venture here.
Ok, onward...
Another month, another record.
Oh hey, May. May was the strongest venture funding month of 2021 by all measures. B2B software services and Fintech again dominated from a dollar-funded perspective, receiving 48% of total funding. Retail and Marketplaces was the breakout segment, though, grabbing triple silver for the most deals, the most funding, and the largest average deal size.
NSW startups received 55% of total funding, and the three largest East Coast states accounted for 85% of total funding. Startups from all Australian states plus the ACT attracted funding. NZ was a standout from a dollars-funded-per-capita perspective 😉.
Many tier-1 local early-stage funds, along with a spattering of global all-stars, participated in 2021's busiest Seed-funding month to date. Notably, seven start-ups born in the COVID-era raised $86M. Start-ups under four years old accounted for more than half of venture funding raised. At the other end of the spectrum, companies over 10 years old raised $190M, or just under a third of the total capital raised. Series B and beyond deals accounted for half of the total money raised.
Much like cryptocurrencies, crowdfunding in the US is having a moment. The same cannot be said for the asset class in Australia. Successfully funded deals slowed to a trickle in May, and many deals across the major platforms were either delayed or pulled. The segment has boomed in the US due to people stuck at home with stimulus checks, lofty asset prices across traditional asset classes, positive regulatory changes, and several innovative new platforms coming to market. I'll continue to track the local platforms as the global trend is strong, but we're not on the wave yet.
Retail renaissance. Buy Aussie Now was launched at the height of the COVID-19 lockdown to push Australians to buy locally made products. Less than a year later, with 7,000 Aussie businesses set up or onboarding on the marketplace, the start-up raised $2.3M from prominent business execs, lawyers, and athletes. Expect to see the more athletic of the investors – cricketer Aaron Finch, AFL's Jarryd Roughead, and rugby's James O'Connor – play a key role in getting the word out as the new retailers' highly vested fanboys.
In other retail news, eight-month-old Carted raised $13M from top local and US investors to build its still-in-Beta e-commerce API. Meanwhile, thirteen-year-old Comestri raised $15M to continue to build its platform that does the unglamorous but critical work of helping large retailers sell and fulfil across multiple channels without a hiccup. The Commonwealth Bank made two big marketplace bets, backing electricity marketplace Amber and yet-to-launch retail mega-market Little Birdie. Both involve distribution deals... Someone within CBA just realised that their 11 million customers also use electricity and buy stuff.
Old dog self-taught new tricks. The twenty-nine-year-young PropTech firm Console Group raised $7.5M to fuel its nascent cloud product's growth and product development. Console Cloud provides automated management of funds, trust accounting, and other aspects of property management. Slightly younger Rental Heroes raised a Seed round from locals Artesian Capital and Investible, and US-based Hustle Fund. The start-up’s property management software uses AI to automate tenant enquiries and management issues – delivering the heroic outcome of corresponding less with one's landlord.
Legal eagles go tech. The notoriously tech-forward legal industry saw some movement in May. LawVU raised a pre-Series A convertible note to drive US growth of its collaboration software for in-house legal teams. The no-code legal task automation platform, Josef, raised $2.5M to fund international expansion. Meanwhile, Gathered Here, which offers a solution to everything death-related (except death itself), raised $1.1M to scale its automated will-writing service.
Other highlights:
Alcohol-free spirits start-up Lyres raised $9M to keep one-half of the baby-on-the-way Gillings household hydrated. Mass Dynamics raised a Seed round to develop its SaaS tool which helps scientists process, validate, analyse, and share scientific studies. Pyn raised $10.4M to help employers communicate more effectively with their employees. Scott Farquhar and global VC powerhouse Andreessen Horowitz led the round. Notably, Pyn is Andreesen's first investment in Australia.
Slide this in the 🤯 column. Bit.Country raised a Seed round from a who's who of gaming and crypto influencers. Bit.Country is a virtual world with its own universe, internal currency, economic mechanisms, and governance. Rather than attempting to explain further, here's a copy of Bit.Country's Whitepaper.
Caught the eye of the Tiger.
Tiger Global, the NY hedge fund with a 20-person investment team, has funded 117 start-ups in 2021. That is quite a lot. Safety Culture and Stake are Tiger's first Australian investments in 2021 – and you can bet they will not be it's last, given Tiger just closed a US$6.7 billion fund. Tiger has enjoyed Aussie success before, joining TDM and Mike Cannon-Brookes in a pre-IPO investment in Tyro in 2015. They also invested in Shippit and Practice Ignition.
Everette Randle of Founders Fund wrote a great blog post highlighting the disruptiveness of Tiger's approach to venture capital. Tiger has built a strategy that exploits the modern realities of what it believes are outdated venture investment norms. Randle's breakdown, albeit highly Tiger-bullish, is worth reading.
Safety Culture doubled its valuation from a year ago following bumper COVID-fuelled growth in 2020 as companies globally looked to Safety Culture to ensure offices complied with return-to-work protocols. Commission-free trading app Stake raised its first significant round of capital, following 5–7x customer growth over the past 12 months. Much like its American doppelganger, Robinhood, the January GameStop trading frenzy caused significant outages and ensuing customer backlash for Stake. Robinhood is expected to IPO in Q3 at a US$30 billion market cap.
It's entirely appropriate that the largest-ever locally-led VC round was achieved by a start-up tied to the Australian residential property market. A batch of top Aussie VCs and Superannuation funds ploughed $90M into Athena, a mortgage lender with an entirely digital experience and borrower-friendly features, like interest rates that decrease as LTVs fall. The raise values Athena the same as a three-bedroom, one-bathroom Bondi semi.
Australian-founded but now Singapore-based Una Brands acquires and operates small- to medium-sized e-commerce businesses. This roll-up approach to e-commerce made headlines in 2020 when Amazon-business roll-up company Thrasio became the fastest-ever US start-up to reach unicorn status. Since then, many competitors have jumped in, all vying to become a modern-day P&G/Unilever.
Yet-to-launch Little Birdie snapped up a juicy round at a massive $130M valuation. Founded by Catch of the Day's senior team, Little Birdie aspires to be "the homepage" of online shopping, allowing customers to compare pricing from different stores and brands. Commonwealth Bank investing in Little Birdie is what makes this deal interesting. CBA will integrate Little Birdie's shopping content into its mobile app. For Birdie, there are few better distribution partners out there – 6.5M Aussies use the CBA app. For CBA, Birdie may be the Afterpay killer it has longed for. It would be hard to imagine any BNPL other than CBA's own offered via the CBA/Birdie integration.
A less good record...
The funding gap between male and females founded start-ups hit a monthly high in May. Start-ups with at least one female in the founding team raised 7.2% of total funding for the month. Strangely, this puts ANZ well ahead of the global stat: women-led companies raised just 2.8% of global venture capital in 1Q21.
What's missing from this data is an understanding of the top of the funnel – i.e. how does the application-to-funding rate of male-only vs at least one female teams compare. I'm working on that. I'd love to hear from local investors as well as any female founders to get their perspective (via this form).
Fundraising startups who want to connect.
Each edition features fundraising startups, with the opportunity to connect with the respective founders directly. These founders submitted their startups, and they're included due to the interesting problems being solved.
The information below is not verified and is not financial or investing advice. I'm not soliciting or accepting any investments on behalf of these companies, and I am not financially incentivized to connect them with investors. I'm just a matchmaker.
Skoutli is a marketplace for location scouting that lets you search, book and pay for a shooting location.
Founder: Caroline Lepron & Jason McDermott
Segment: Marketplace
Description: The content creators economy is booming. we are creating a new category helping content creators book locations for their shoot. Skoutli is a one-stop-shop online marketplace that lets you search, book and pay for a shooting location. Bookings are flexible - pay by the hour or by the entire day and also depending on the number of people on the shoot. Skoutli already partners with some of Australia's best known brands.
Raise info: Opening round of $500k on Safe notes. Connect with Skoutli
Book a Mat builds simple, effective and affordable studio software to empower fitness businesses everywhere.
Founder: Benjamin Shannon
Segment: B2B software and services
Description: Book a Mat's SaaS solution provides an all-in-one solution for managing a boutique fitness studio, including scheduling, payments, member communications, and reporting. Used by 100 studios globally.
Raise info: Raising $500K and currently speaking to investors. Deck available.
All of the deals
Next month will be Cut Through Venture's 1H in Review. If I've missed a deal this year, help me make the data better by responding to this email with the details.
B2B Software & Services
Rocketeer raised $305K (Link)
Pyn raised $10.4M (Link)
Portainer raised $5.6M (Link)
SafetyCulture raised $95M (Link)
AuditCover raised a ??? round (Link)
CircleSource raised $1M (Link)
B2C Software
Travello raised $6.5M (Link)
Deckee raised $710K
Gathered Here raised $1.1M (Link)
Climate / Environment
Sea Bin raised $1.2M (Link)
Consumer
Raine raised $700K (Link) 🦸♀️
Zoomo raised $16M (Link)
Lyre's Spirit Co raised $9M (Link)
Cybersecurity / AI / Data
Qsic raised $4M (Link)
Fintech
mx51 raised $25M (Link)
First AML raised $7.3M (Link)
Athena raised $90M (Link)
Health / Biotech
ImmVirX raised $22M (Link)
Mass Dynamics raised $1.5M (Link) 🦸♀️
Logistics / Hardware
Liquid Instruments raised $17.8M (Link) 🦸♀️
Quasar Satellite raised $12M (Link)
FiberSense raised $11M (Link)
Marketing / Cust. Success
Shuttlerock raised $26M (Link)
Media / Collab / Gaming
Bit.Country raised $5.2M (Link)
Real Estate / Construction
Uptick raised $2.6M (Link)
Console Group raised $7.5M (Link)
Rental Heroes raised $1M (Link)
Retail / MarketplacesComestri raised $15M (Link)
Amber Electric raised $20M (Link)
Mys Tyler raised $1M (Link) 🦸♀️
Carted raised $13M (Link) 🦸♀️
Buy Aussie Made raised $2.3M (Link)
Little Birdie raised $30M (Link)
Thanks for reading.
See you next month.– Chris
