This Week in Australian Startups #63, 14th April 2024
This Week in Australian Startups #63, 14th April 2024
It’s that time we all look forward to, the release of the Cut Through Quarterly. The highlights and overall summary below and here on LinkedIn by Cut Through Ventures;
Without going deeper into the above, or existing analysis (which I’ll link to at the end) - my two takeaways:
Australia outperforming on a global scale
“Start-up deals fall to six-year low as tech winter persists” That was the headline in the AFR.
The dip in total funding from Q4 to Q1 was ~45%, but when comparing Q1 2023 to Q1 2024 we actually saw an increase of 6.35% in total funding.
Whilst it’s important to measure how we are faring against our own historic performance, there are significant macro-economic trends at play, so more than ever it’s important for us to benchmark our performance on the global stage.
According to Crunchbase data, whilst quarter on quarter we are pacing behind (+6% global, -45% Australia). When comparing Q1 year on year we have in fact outpaced the global market which is -20% compared to the +6.35% here in Australia.
As highlighted in the report “…the data from the second quarter will provide greater insight into whether the new calendar year has fostered a greater willingness and capacity among startups and investors to engage in transactions at a rate faster than what was seen over the last 18 months.”
There’s been a few liquidity events, but none greater than the ~$2.5B in the secondary share sale from Canva. The majority of that will be kept in Australia - whether that’s going to be reinvested into our ecosystem and this year time will tell.
Cautious Optimism
That’s my biggest takeaway. Our ecosystem is pacing ahead of global trends along with several other positive trends as highlighted in the report.
Whilst the number of deals has reduced by -19% year on year (Q1 ‘23 to Q1 ‘24), the average deal size increased from ~$8M to $10.6M. There is a greater focus on due diligence and investing in higher quality deals with increased investments. It’s tougher to raise, but good deals will attract more investment.
We also saw two new startups join the unicorn club in Bugcrowd and Deputy. I wrote about Deputy last month and why it’s the model startup in the post ZIRP environment. Unless there’s a genuine (or hyped) AI startup, future unicorns will need to have similar economics to Deputy.
Other analysis on the report;
Startup funding raises fall to six-year low in Q1 amid spike in funds per deal, investor sentiment (BNA)
Startup funding rounds hit six-year low (InnovationAus)
Adam Caines, co-founder of Upplft (LinkedIn)
Jeremy Liddle , Executive Director at Third Hemisphere (LinkedIn)
Leila Oliveira, Investment Manager at Birchal (LinkedIn)
Australia
Top News
The NSW government is putting Investment NSW under the premier’s wing (Startup Daily)
Maria MacNamara is the Space Industry Association of Australia’s new CEO (Startup Daily)
WA is getting a government-back nature and biodiversity accelerator thanks to Founders Factory (Startup Daily)
Social enterprise platform StartSomeGood acquired by General Good (Startup Daily)
Dubber fires CEO and cofounder Steve McGovern over $26.6M in missing company funds (ARN)
Forage, which helps students move from study to the workforce with virtual job simulations, is being acquired by US education firm EAB (Startup Daily)
Woolworths partners with Tesco on $190M to create a global fund looking to back startups in the shopping space (AFR)
Leonardo.Ai targets businesses with Teams launch after doubling user base to 15 million (SmartCompany)
Harvest B launches world-first half meat-, half plant-based product (SmartCompany)
Andromeda Robotics: On the brink of profitability with a lean approach to hardware (SmartCompany)
ASIC appeals loss against Finder’s cryptocurrency product (SmartCompany)
NextDC plots $1.3B capital raise (ARN)
AWS launches general availability of Bedrock in Sydney (ARN)
LuminaX unveils its 2024 cohort, featuring new HealthTech innovations (LX Health)
Blackbird nets $800M payday from Canva share sale (AFR)
Canva agrees to settle unfair dismissal case from senior engineer (AFR)
Australia merger laws: Jim Chalmers’ reforms threaten to ‘kill off start-up sector’, tech leaders warn (AFR)
Uber v GoCatch: failed start-up was shedding users before rival turned up, court told (AFR)
Dovetail kicks off AI-driven enterprise push (Capital Brief)
'We risk stifling innovation': Startups, Tech Council cool on Labor's merger changes (Capital Brief)
WA's Purpose Ventures seeks to add startups to the mining state's biggest exports (Capital Breif)
Employment Hero has acquired Employment Innovations (Ben Thompson)
Elli Hanson joins Side Stage Ventures as a Principal Investor (Elli Hanson)
Equity Clear, an initiative led by Scale Investors, Alberts, and Giant Leap, website `is now live and on a mission to increase transparency on gender, intersectional representation and identities in startup funding (Lisa Fedorenko)
Funding Rounds
Honey Insurance, a startup proving smarter home insurance, has raised $108M Series A (Startup Daily | SmartCompany | BNA | AFR)
Skin2Neuron, biotech startup that is trying to crack the code to Alzheimer’s disease, raised $4M and is looking to still add another $11M before closing this round (The Australian)
AVESS Energy, energy storage systems startup, raised $1M in Series A Round 2 (SmartCompany)
Alta Group Global, which runs a mixed-martial-arts training app, raised $9.9M AUD ($6.5M USD) through an IPO on the NYSE (AFR)
Plancare, a technology platform that provides a comprehensive solution for self-managed healthcare, has raised an undisclosed amount from Purpose Ventures (Startup News)
SupplyScope, a startup who connects sellers with a growing network of vetted manufacturers, has raised an undisclosed amount from Skalata Ventures (Skalata)
Around The World
Top News
Multiverse has acquired Searchlight.ai to use AI to diagnose skills gaps and opportunities for internal mobility (Euan Blair)
Google blocks California news in response to bill that would force tech giant to pay (NPR)
TikTok Plots Using Virtual Influencers for Advertising (The Information)
Alibaba's Jack Ma steps out from the shadows with morale-boosting post (Yahoo)
WordPress.com owner Automattic acquires multiservice messaging app Beeper for $125M (TechCrunch)
Jack Altman’s Venture Fund Launches Accelerator for Enterprise AI Startups (WSJ)
OpenAI and Meta ready new AI models capable of ‘reasoning’ (FT)’
TikTok’s Instagram competitor likely to be named TikTok Notes (TechCrunch)
After Bitcoin Surge, Crypto VC Creeps Toward a Comeback (Bloomberg)
Funding Rounds
Kiwi legal tech startup VXT banks $1.65 million in pre-Series A (Startup Daily)
Fintech FloQast Secures US$100m in Series E Funding (FinTech Magazine)
AI data security startup Cyera confirms $300M raise at a $1.4B valuation (TechCrunch)
Varda Space’s orbital drug factory success fuels $90M in new funding (TechCrunch)