Call centre AI pivot (and AWS surge) helps Local Measure raise $7.9m

Call centre software start-up Local Measure has raised $7.9 million led by returning investor Future Now Capital, as it rolls out new generative artificial intelligence features.

Founded by Jonathan Barouch as a hospitality and tourism software business, Local Measure completely reinvented itself over the last three years after COVID crushed its revenue streams.

Its contact centre software is gaining traction, thanks in part to a significant partnership with Amazon Web Services, and revenue has grown 250 per cent year-on-year as the company signs up customers in the telco, insurance and airline industries.

During the pandemic, Local Measure rebuilt its platform on top of Amazon Connect and last year signed a strategic deal with the cloud computing giant which incentivises AWS reps to sell Local Measure’s software.

“It’s fundamentally changed the trajectory of the company,” Mr Barouch said.

With 50 staff, Mr Barouch says Local Measure’s revenue is now higher than its pre-COVID levels, which dropped 70 to 80 per cent during the pandemic. The company is aiming to reach cash flow break even in the next 18 months.

The software business is also preparing to roll out its first generative AI features, built using Anthropic’s Claude, which will help summarise call centre conversations and assist agents solve customer problems.

“We are talking about material time savings – five, six, seven minutes a call – which is pretty amazing,” he said.

Mr Barouch said the valuation was flat on the company’s previous raise. It publicly announced $4.5 million external funding round back in 2017 but has kept subsequent funding rounds private, including a couple of million dollars during the pandemic, which helped it weather the storm.

Existing shareholders, Mr Barouch, Local Measure’s management team and board, as well as family offices, also participated in the latest $7.9 million raise.

Future Now Capital’s investment came from a fund that is being put together for follow-on investments in its portfolio companies. The firm has invested more than $100 million through its funds to date.

The founder of ASX-listed software stalwart TechnologyOne Adrian DiMarco is among investors in a seed funding round, in manufacturing sector focused software platform Factory.app.

The $1.05 million round was led by venture capital fund Investible, and also included money from 1in100 Ventures, Beachhead Venture Capital and Hugo-Hamman Investments.

Factory.app was co-founded by brothers Paul and Michael Lutkajtis in 2021, targeting a perceived gap in the market for job-tracking software for fabricators. The announcement of their funding round comes shortly after Singapore-based, Australian founded manufacturing design platform start-up Phasio closed a $US2.5 million ($3.9m) round.

Michael Lutkajtis is also the managing director of family-owned manufacturing firm Vilno Group, while Paul Lutkajtis has worked as a product manager for both Assembly Payments and REA Group, since the pair previously founded a social networking start-up called Bridge.

“Coming from the industry, we were literally living the same pain of manual processes and constant double handling that our customers face every day,” Paul Lutkajtis, who acts as CEO said.

“With 90 per cent of the manufacturing industry being made up of similar-sized businesses to our own family-business, we knew we could deliver huge value to thousands of companies globally by leveraging our own experience to build a software platform that feels fit for purpose.”

LAB Group, which sells digital identification and “client onboarding” technology for the financial services sector, has banked $6.9 million in a fresh funding round.

The Sydney-based company’s newest investor is private credit provider Global Credit Investments, which has tipped more than $1 billion into high growth start-ups.

Founded former Australia and New Zealand Banking Group and National Australia Bank manager Nick Boudrie alongside former consultant Lyndon Webster, around 12 years ago, LAB Group is looking to turbocharge its growth across financial services licensees internationally.

As it stands, it has offices in Melbourne, Sydney, Brisbane and Copenhagen.

It previously raised capital in early 2021.

US-based TCV (Technology Crossover Ventures)has led a $263 million funding round in human resources technology firm Employment Hero, sealing the biggest capital raising of the year for a local privately held software business.

The company is almost 10 years old, and now has a valuation just shy of $2 billion, a hefty upgrade on the $1.25 billion valuation it secured in its previous funding round early last year.

The deal remains subject to approval by the Foreign Investment Review Board. It also included money from returning investors Insight Partners, AirTree Ventures, Seek Investments and OneVentures.

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Repeat founder Alisdair Faulkner’s second cybersecurity company Darwinium has raised a $US18 ($28.2 million) Series A round from US Venture Partners, Blackbird Ventures, AirTree Ventures and the Boston fund Accomplice.

Darwinium, which was founded by Mr Faulkner along with other executives from his first company ThreatMatrix, which was sold for about $1 billion, makes fraud detection tools for financial institutions and ecommerce sites.

Its tools, which it sells using a subscription model, track whether a user’s behaviour — including clicks, computer setup, browser and a host of other markers — suggest that they might be a bot or someone acting under duress from someone like a romance camera coaching them to transfer money or buy a product.

They are deployed using content delivery networks — the servers that are scattered around the world to help websites load faster — differentiating Darwinium’s products from most anti-fraud tools on the market.

The Australian Competition and Consumer Commission’s Scamwatch report recorded the country losing $3.1 billion to scams last year.

Mr Faulkner would not disclose the valuation for the series A raise but said it was higher than the Sydney-based company’s previous round of $10 million last year.

The deal includes a $US2 million SAFE note and the funding will go towards Darwinium’s global expansion plans.

“Multiples have fallen back to a rational point but there’s quality money backing quality Australian technology,” Mr Faulkner said. “It’d be great if local banks and e-commerce stores had the same mindset.”

Blackbird partner Niki Scevak and US Venture Partners’ Rick Lewis are taking board seats as part of the deal.

Raaj Govintharajah remembers when his start-up, The Martec, was one of OpenAI’s major partners. “We had really close conversations years ago, we were early adopters,” he said, having founded the marketing software company in 2019.

Now OpenAI, which produces the wildly popular ChatGPT, is the highest profile artificial intelligence firm in the world. And Sydney-based The Martec has raised $8 million in a round led by AS1 Growth Partners with participation from AirTree Ventures. It did not disclose its valuation.

The Martec, which unlike Facebook has retained the definite article in its name, uses OpenAI’s models and its own to create customised content to help businesses hire staff.

“Broadly speaking, we’ve grown 3.5 times year-on-year, and our customers are growing between 150 and 200 per cent year-on-year naturally themselves. We’re looking to end the year with about 30 odd people, and probably double that the year after,” Mr Govintharajah said.

The business, which Mr Govintharajah said formally launched its cloud content this year, claims customers including design software giant Adobe and hotel chain Marriott.

AirTree partner Jackie Vullinghs said, “The Martec’s impressive traction since the product launch in January is testament to how well their solution resonates with worldwide enterprise customers.”

Mr Govintharajah said he believes The Martec’s suite of products, which include AI job descriptions, prompts for staff to endorse their employers and customised content for different roles on hiring pages, will help protect his company if a larger AI firm decides to enter the space.

Klean Technologies, a Brisbane-based software start-up that pitches itself as a sustainability engagement platform for retailers and e-commerce operators, has bagged $750,000 in pre-seed funding from a syndicate of angel investors from Ipswich in Queensland.

The syndicate is led by serial entrepreneur James Long, and will be used over the next 18 to 24 months to hire more staff, develop its product and start investing more in marketing to attract customers.

The early-stage firm currently has four full-time employees, and early clients including Gold Coast-based outdoor gear retailer Wild Earth, Melbourne based homewares brand Hommey, and fashion brands Nique and Ginger Lily.

Co-founder Shan Vahora said the company was founded last July, and that its products let brands highlight their ESG credentials and give their customers options to support different worthy projects at the online checkout.

Singapore-based, Australian founded manufacturing design platform start-up Phasio has closed a $US2.5 million ($3.9m) funding round led by AirTree Ventures.

The company has built a platform that lets manufacturers collaborate on projects and discuss changes with their clients. It was co-founded by former JP Morgan Software engineer and serial entrepreneur Harry Conor Lucas, and former scientist Sudharshan Raman.

VC funds 500 Global, Entrepreneur First and private investment office Gattaca Ventures also contributed money to the round..

Apollo Secure, which sells subscription tools for cybersecurity training, compliance and documentation, has raised $600,000 in a pre-seed round.

The early funding for the company was led by the Sydney Angels investment syndicate with smaller cheques from Brisbane Angels and members of Angel Loop, another network of investors.

Unlike larger cybersecurity vendors, Apollo Secure is targeting small and medium businesses. “While the broader investment market has been tight, we’ve found a collection of pro-active angel investors who understand the need for what we offer and are willing to back the team,” said Apollo’s founder, Damien Cantelo.

The company did not reveal its valuation.

Melbourne-based AutoGrab, which has built a live ledger of online car listings, has raised $7 million from Australian venture capital investors EVP and Ten13 to double down on its international markets.

Founded by Daniel Werzberger and Chris Gardner in early 2020, AutoGrab is a subscription software business that provides valuation data for vehicles.

AutoGrab’s technology feeds data from a variety of sources – online car portals, general classifieds sites, auction data – into its pricing engine that it claims prices every car on the internet in Australia, and predicts how their value might change over time.

The fresh $7 million investment follows the company’s 2022 $5 million Series A raise, and was led by led Ten13 and Melbourne-based private equity firm Nash Advisory.

The founders declined to reveal AutoGrab’s new valuation, but said recurring revenue had more than doubled since its Series A round.

Mark Velik, investment principal at EVP said AutoGrab had reached profitability through strong revenue growth, rather than a deliberate push “to start throwing off amazing wads of cash”.

Autograb currently operates in Australia, New Zealand and Malaysia and plans to launch in the United Kingdom and Europe by the end of the year, before the United States and South East Asia in 2024.