💌 9th July Weekly Retro of Australian Start-ups & Venture Capital

9th July

G'day and welcome to Overnight Successes, the weekly newsletter that levels you up on everything Aussie Start-ups.

Inspirational Pep Talk

The Aussie start-up ecosystem mirrors Australia's natural ecosystem. Bare with me on this one.

Okay so let's take Kangaroo Island for example. On the 20th of December, 2020, Kangaroo Island was set alight by lightning strikes. By the 3rd of January, evacuations of the island had begun. The fire tore through the densely populated bushland and the landscape was torched leaving nothing behind.

Thankfully, Australia's native flora has evolved to cope with fire. The fires cleared out Kangaroo Islands' dense bush, and thousands of grass trees called Yuccas sprang up within months. Below, we can see the vegetation height before the fires arrived.

Much like the current climate in Aussie start-ups, the new funding environment has increased pressure. We’ll increasingly see start-ups close their doors after being unable to sustain their business models in the new funding environment. But, like the Yuccas of Kangaroo Island, founders are ready to seize the opportunities. The start-ups that are able to survive the next 12-18 months will reach new heights only possible after their mettle is tested. See below for an example of new growth springing up following a fire.

With one start-up laying off staff, we see 2 start-ups looking to hire. We're very excited to see what new growth is coming through the Australian start-up ecosystem in the next 12 months. While the media continues to beat the drums of failure, many more courageous founders are going all-in on fantastic ideas. Cheers to them!

Headlines:

The bad news:

• Some start-ups continue to trim their workforce.

  • Sendle reduced its workforce by 12%

  • Airtasker reduced staff numbers.

  • Mycelium, a web3 firm looking to create DeFi projects has also reduced staff.

  • HealthMatch slashed staff by 50%

  • Brighte, a residential solar power financing startup removed 15% of its staff.

• Zip Co owned PocketBook is shutting down.

The good news: 

• Between Work, the initiative to help start-up workers who’ve been laid off find their next role faster. Within 2 weeks, over 100 companies have signed up to hire for 1000+ roles.

• According to Cut Through Ventures, Australia has seen 1H22 close with more funding than the previous 1H21 and 1H20. Total funding closed for the first half of CY22 was $4.8B.

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1. Introductory thoughts

2. Headlines: News that's important, but you might have missed.

3. Start-up retro: Summarising the week's start-up raises with a smidge of context.

4. Notice Board: Signposting key events and opportunities in the ecosystem.

5. Accredited Tweeters: Snippets from Twitter and linkedin!

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

Start-up Retro!

FinTech

🌱Pearler

News: The long-term investing app, Pearler, has raised a $7.9M seed round led by Canadian-based Portage Ventures. The round also included Ten13 and Archangel Ventures. Pearler positions itself as boring investing for the long-term. The app focuses on ETFs, shares and funds allowing users to build the habit of consistent investing. As Papa Warren says, “It's time in the market, not timing the market”. Pearler also tracks users' wealth across various asset classes including US and Aussie equities, cash, super and property. Presently, there are 53K accounts on the platform with $490M in investments. The app takes a $6.5 clip on each trade which is between traditional brokering platforms and newer free brokerage like Stake. The capital will enable Pearler to invest in its product as it hopes to expand into new demographics with the upcoming release of a child-focusing savings tool.

Read more about it: (AFR)

EV

🌱Chargefox

News: Australia's largest network of public charging stations, Chargefox, has been acquired. The acquirers were a group of motoring organisations led by NRMA. Chargefox was valued at $56 million with many of the motoring orgs already having a stake in the business. Watt does this mean for Chargefox? Not much, the business will continue to operate as usual and plans to build more than 5000 EV stations across Australia by 2025. So far, Chargefox enabled 6M green kms across half a million charging sessions. Chargefox locations can be found at large retailers like Coles, Woolies etc and users pay for the electricity. The business that hosts the charger unlocks a new revenue driver.

Read more about it: (Start-up Daily)

Web3 Biotech (not actually web3)

🌱Infensa

News: Okay, it’s not web3 but involves spiders! Brisbane-based bioscience start-up, Infensa, has raised $23M to utilise spider venom in life-saving preventative medication. The funnel-web spider venom blocks signal that cause cells to die. When delivered after a heart attack, victims may reduce damage to their hearts. And gain superpowers. I will confirm that last point after clinical trials. The drug can also be used to prevent heart disease. The company was spun (like a web) out of the University of Queensland and will be commercialised by the Uni’s own commercialisation company, UniQuest.

Read more about it: (ABC News)

SME

🌱Cloutly

News: Cloutly, the start-up that enables businesses to get high-quality reviews, has raised a $500K pre-seed round. The round was led by Unify Ventures with participation from Palm Beach Ventures and a bunch of angels. The app hopes to remove the current transactional approach to reviews like generic NPS scores and emails. Cloutly instead looks to improve the 7% response rate most review generates by sending a personalised text or video. The reminders are segmented depending on the customer type and provided to make the customer feel special. Nothing generic here. For the business, all reviews are tracked in one place, from google to glassdoor. From here, a business can understand its reputation across the web and respond to common themes. Karens need not apply.

Read more about it: (Business Traverse)

Recruitment & Gig Economy

🌱Sidekicker

News: The platform providing short-term and casual work for more than 40,000 casual employees across Australia, Sidekicker, has raised $20M from Seek. The casual jobs platform enables 2000+ organisations across Aus and New Zealand to supplement their workforce. Clients include Uber, Crown and Australia Post. With 70% year-on-year revenue growth, despite Covid, Sidekicker is a dream strategic investment by Seek who was the sole investor. Sidekicker hopes to target new industries requiring some qualification with Aged Care being the next target. Marketplaces are hard to run at the best of times, too much supply means available workers will leave the platform. Sidekicker has been conscious of this and limited the balance of supply and demand so workers are always able to pick up work.

Insurance

🌱Upcover

News: Antler’s accelerator alumni which looks to reduce friction for SMEs to get insurance, Upcover, has raised $4.7M. The capital was a mix of equity and debt with $2.7M of equity raised. Antler, Betterlabs and a consortium of business leaders contributed to the round. Upcover offers insurance directly through its website but also via an embedded channel that marketplaces can insert for their partners. An example would be a rideshare company offering insurance to its workers. The start-up left beta and launched 8 months ago like a rocket ship averaging 20% month-on-month revenue growth. Upcover's unique driver is marketplace distribution which enables those marketplaces to monetise their customers further. Expect Upcover insurance via this newsletter soon!!

Read more about it: (Start-up Daily)

Notice Board

• Rampersands Giant Warm Intro back. Check it out for advice, pitch feedback or some networking. More info here.

• Looking to level up on product management? Startmate has launched its Product Management 101 fellowship. More info here.

• Export Market Grant applications for SMEs have opened. If you're a growing start-up looking to expand internationally, check it out here!

Accredited Tweeters

(KaaS) Knowledge as a Service

• Recently, I've learnt the power of grants. Turns out the government is sometimes just happy to help. Grantguru.com.au does some heavy lifting through the bureaucracy to give some life-saving cash.

• Early-stage VC for founders. Heads up this is a PowerPoint. It's also basically all of the book "Secrets of Sand Hill Road: Venture Capital and How to Get It" in a snappy power point. Worth spending some time on! Check it out here.