G'day and welcome to Overnight Success! A big shout-out to the 26 new subscribers who’ve joined since the last edition.

⚠️ Self-promotion warning⚠️

OS was recently interviewed on the Calling Operator podcast by Paloma Newton. If you’re interested in hearing a bit more about the story behind OS, how we write the newsletter each week and what we have in mind for the future, have a listen. While you’re there, be sure to queue up a few other episodes interviewing some of Australia’s most interesting and skilled start-up operators!

Startmate also featured OS and how we (and other great start-ups) leverage no-code tools to build out our business. Thanks team!

Headlines

🙈 Start-ups in trouble

• Proptech start-up :Different called in administrators on Friday to sell off its IP and assets after failing to secure essential funding. The company, which was backed by Airtree and named as one of LinkedIn Australia’s ‘Top Startups’ in 2022, raised around $30M over its 6-year lifespan and had approximately 200 employees at the time of the wind-up. (AFR)

• Period pain remedy start-up Ovira, previously clouted as Australia’s biggest brand on TikTok, landed itself in hot water this week after an influencer claimed the company used her content to promote their products without permission. (AFR)

🕺Step aside AI, blockchain is back (in the headlines), baby…at least this week

• Australian Blockchain Week saw Web3 ‘true-believers’ sit side-by-side with institutional players from the government and the big-4 banks as they discussed the state of play and the role of regulation.

• In the wake of some of Australia’s big banks cutting off the accounts linked to the world’s largest crypto exchange, Binance, Treasury has asked the banks to justify their actions.

  • Reading between the lines, it seems the government wants to ensure the banks aren’t trying to shut out potential future competitors.

• (Although the AFR was quick to jump on the negative angle…) It was revealed this week that Immutable has recently brought down its ESOP strike price from $900 to $345, which the scale-up says is in a bid “to ensure new and existing employees have substantial exposure to the upside of the company”.

🔬🥩 Lab-grown (aka ‘cultivated’) meat given the green light in the US, opening the door for Aussie players (Inside FMCG)

• In what may be a watershed moment for the category, the US Department of Agriculture this week granted approval for the sale of cultivated meat, making the US the second country in the world (after Singapore) to approve the new animal-free technology. The FDA also approved the sale of two specific cultivated chicken products for sale.

• There are 4 key players in Australia at the moment: Vow, which focuses on novel meats such as crocodile, quail, and potentially kangaroo and water buffalo; All G, which produces cultivated milk and cheese; Heuros, which produces GM-free growth factors to make cultured meat and Magic Valley which focuses on traditional meats such as cultivated lamb.

  • Kudos to avid OS reader Andrew Harding for digging into this one for us!

🔥 PLUS 4 start-up raises + 1 report summary + 3 wins & a new fund! Read on! 👇

⚡️Start-up Retro⚡️

FinTech

Sherlok raises $3.4M to give borrowers an AI edge on their mortgage rates

Adelaide-based AI FinTech, Sherlok has secured $3.4M in funding to refinance mortgages automatically. The round was led by Rampersand and included Investible, Paloma Ventures and Common Sense Ventures.

The capital follows 700% user growth in the past year, primarily due to significant broker uptake. Additionally, the tailwinds of increasing interest rates has seen a flood of users looking for repayment relief for their clients. The fresh funds will be used to support Sherlok's expansion among mortgage brokers and aggregators, starting with a partnership with AFG. Sherlok's AI leverages open banking data to identify better rates and facilitate automatic rate reduction for homeowners. This means a broker can keep clients happy, likely reducing churn. The open banking data will also allow Sherlok to offer a single-click refinancing tool soon to make approvals instant.

Due Diligence: Rampersand Investment Notes & The Australian

Cybersecurity

Nullify lands $1.1M pre-Seed to help developers identify security risks as they code

Cybersecurity start-up Nullify has raised $1.1M in a pre-Seed round led by OIF Ventures. Skylight Cyber, Black Nova Venture Capital, and Cyrise also participated in the round. Nullify has developed an AI bot that helps developers and security teams identify and fix code vulnerabilities.

Nullify's bot is unique because it detects and helps fix security issues within a company's codebase and cloud environments. The bot works within existing workflows for ease of use and continuously provides advice as code is updated. Several companies already use the tool, both domestically and internationally.

The funding follows a series of highly publicised security breaches, including at Optus and Medibank. The founding team believe the vulnerabilities used in the Optus hack, in particular, would have been identified by the Nullify bot and would have prevented customer data being released to the public ~ potentially saving millions in damages. For the new investors, the ability of the Nullify bot to quickly scale across businesses and development teams highlights it as an exciting opportunity.

Nullify's sponsorship of Overnight Success' 1st Birthday 2 weeks ago provides enough positive signals for some…!

Due Diligence: The Australian & Startup Daily

Web3 / Telecom

Readii raises $2M for Web3 internet service that pays customers

Readii, a Melbourne-based Web3-enabled telecommunications platform that pays its customers while they surf the internet, has landed $2M in funding. The capital comes from strategic investors Telstra and Stripe.

Readii aims to differentiate itself from traditional telcos with several key features. The platform shares 10% of revenue with its users via the Readii native token, $RDI. The token can then be reinvested into your monthly fee, lowering the cost or withdrawn as a reward. Users can even pay for their monthly invoices using cryptocurrency.

The platform hopes to disrupt the telco sector with its rewards program and add new features. Users can store their private cryptographic keys using the company's routers. Expect to see the full launch later this year, but users can register on the waitlist now. The co-founder, Daniel Li, previously founded Stables (stablecoin payments platform), ReadiiNet and ReadiiTel.

Due Diligence: FinTech Times

AgTech

Stacked Farm stacks on $40M in capital to develop an end-to-end farming automation system

Queensland-based AgTech start-up Stacked Farm has raised $40M. Tayside Investments Australia led the round, which increased the total capital raised by the company to $98M since 2021.

Stacked Farm’s indoor vertical farming technology allows for complete automation of the farming process, from planting to packing. Indoor vertical farms have key benefits, like reducing human intervention and weather-related risks. The highly monitored farms also provide a consistent environment and contamination-free growing conditions.

The Stacked Farm system has also thoughtfully considered its own carbon footprint. The system generates fuel for its power from green biogas and all water in the system is fully captured and recycled. The produce is entirely organic and the farms run ‘carbon negative’, delivering 22,000 tons worth of carbon credits a year.

Stacked Farm sells its produce to several stakeholders in the value chain, including growers, packers, manufacturers, wholesalers and distributors. Stacked Farm has a 4,000sq m facility under construction in the Gold Coast and a 7200sq m automated commercial farm planned for Melbourne later this year.

Due Diligence: AFR & Fruitnet

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

Vibe Check

Climate Salad released its annual ClimateTech Industry Report this week. Here's a brief summary of what's inside…

• 228 Climate Tech companies in Australia raised $553M in the past 12 months but intend to raise $1.5B over the next 12 months.

• There are 3,000+ jobs in Climate Tech already, with 2,400 set to be created over the next 12 months.

• Australia is well-positioned to be a global exporter of climate solutions.

• 84% of Climate Tech companies have tech which has been developed by the founding team. 36% of companies have a valuable trade secret or IP. 28% of them hold patents.

• Investors have backed AgriFood, Data, Renewables, and Circular Economy start-ups significantly more than other focus areas.

You can read the full report here.

New Funds, Who’s This?

Jumar Bioincubator is Australia’s newest biotech incubator, run by Cicada Innovations and backed by CSL, WEHI, The University of Melbourne and Breakthrough Victoria. (Startup Daily)

• The Melbourne-based program worth $30M is seeking expressions of interest from early-stage biotech start-ups who are looking for connections with state-of-the-art facilities, infrastructure, and support to turn ideas into treatments and commercialise medical research.

Wins

Advanced Navigation 🛰 Has secured a $5.2M grant from the Australian Space Agency, which will accelerate development and production of its breakthrough Light Detection, Altimetry and Velocimetry (LiDAV) technology. (Business News Australia)

Baresop 🧼️ After announcing a partnership with GoVita last month, the refillable hand soap start-up has landed another massive distribution deal with major pharmacies like Priceline, Chemist Warehouse and TerryWhite Chemmart which will see them roll out its products across another 4,000 locations. The deal is part of a strategic investment from major distributor Alita Sales who also chipped in $360k to support the business’ growth. (Smart Company)

SeedLab Australia 🌱 Has announced its latest cohort of emerging FMCG brands that will take part in it’s four-month accelerator program, Cultivate. The program is backed by Woolworths. (Smart Company)

Accredited Tweeters

KaaS (Knowledge as a Service)

• Gemma’s Pick 💁‍♀️ Relume Webflow Components Library

  • I’ve been a big Webflow fan for a while and have recently started dusting off my skills to help with a very special new website project (watch this space 👀). I was blown away when I saw this awesome components library from Aus-based Relume, which will cut down your site build time by the bucketload. (Shout out to no-code guru Zac Hardman for this hot tip!).

• Will’s Pick 💁‍♂️ The only thing that matters by Marc Andreessen

  • One from the archives…Andreessen gives his $0.02 on the only thing that matters for an early-stage start-up.

  • He puts forward an interesting case, one I disagree with. Keen to hear your thoughts and debate in the replies.

Have we missed something? Got some feedback? We love emails, so send one over!

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‘Til next time,

👋 Will & Gem