Austin's startup scene is maturing, and it shows. For the third year in a row, local startups raised more money than ever before. Meanwhile, venture capitalists are flocking to the city in hopes of spotting rising stars.
While we've been battling the pandemic, entrepreneurs have been busy with all kinds of innovations. At Austin Inno, we cover as many of these emerging founders as we can. And each year we try to spotlight a batch of what we believe are the most exciting companies to keep an eye on.
Since we started creating this list in 2016, we've featured emerging companies including Favor, Firefly Aerospace, Data.world, The Zebra, Opcity, Icon, Literati and many others that have gone on to innovate, raise money and, in some cases, get acquired.
Like past years, the 22 Startups to Watch in 2022 list covers a broad swath of the local ecosystem, from esoteric software to consumer packaged goods you might already see on store shelves.
The companies highlighted here include companies with seed or series A funding, as well as some that are bootstrapped to this point. Most were founded in the past three years.
Before we dive in, consider subscribing to our daily newsletter, which features companies like these almost every day. Sign up for free right here.
Alright, let's check out our 22 Startups to Watch in 2022.
This company — which hopes to make a splash at South by Southwest this year — made headlines in the fall due to the pedigree of its founding team and its head-spinning vision: to bring back the extinct wooly mammoth. The startup, which is split between Austin, Boston and Dallas, raised $15 million in September and was co-founded by Austin startup veteran Ben Lamm. Executives said they are four to six years away from birthing mammoth calfs, after 18 months of gestation in artificial wombs. In addition to Lamm and Andrew Busey, who co-founded Hypergiant, Conversable and Chaotic Moon together, Colossal Biosciences Inc. has on board the scientific chops of Dr. George Church, who is the Robert Winthrop Professor of Genetics at Harvard Medical School. Church will use gene-editing technologies to lead the startup’s science team. The company’s software and hardware development occurs in Austin.
Austin-based FreeWater Inc. has built a business model around handing out free water. Founder and CEO Josh Cliffords has created a small but burgeoning company that charges other businesses to advertise on consumable products. In addition to giving away free water, the company donates to provide clean water to impoverished countries. The packaging of the water is the ad space, cutting out a U.S. direct mail advertising industry estimated to be worth $7.4 billion in 2022, according to IBISWorld. “We’re disrupting the direct mail industry, or junk mail, which still has one of the highest [returns on investment] in the U.S. ad industry,” Cliffords said. “No matter how much technology you pack in a phone, app or website, it still can’t compete with that piece of paper in the right person’s hand.” A consumer will look at the water bottle, currently the only product from FreeWater, at minimum 10 times before tossing it, the CEO said. FreeWater uses a plant in Northern California for water cartons, and a company in Georgia for aluminum. Cliffords admitted that the process is inefficient but hopes in the future to open a manufacturing plant in Austin, cutting costs about 40% per unit. The company’s valuation has reached $7 million, the CEO said.
Austin-based Strap Technologies Inc., a hardware and software startup that aims to replace the canes used by those with visual impairments to navigate the world, raised a $1.3 million round of funding in 2021. Founder and CEO Diego Roel started the company when he was 18 and has raised money from International Accelerator and angel investors. Strap's chest-worn device helps people by scanning surroundings and communicating back to users. The company, which also has offices in Guadalajara, Mexico, has already landed more than 6,000 pre-orders, and it is one of three Austin-based companies named as a finalist for the 2022 SXSW Innovation Awards.
Software company Journey Foods is the brainchild of founder and CEO Riana Lynn, who developed the data science platform to help food companies from across the spectrum launch products, optimize ingredients and monitor supply chains. The company has plenty of momentum heading into 2022: it landed $100,000 from both Google’s Black Founders Fund and The Kroger Co. Zero Hunger | Zero Waste Foundation, plus it was named one of Austin Inno’s 2021 Fire Awards winners. Journey Foods was launched in 2018 and has raised $5 million in venture funding. At the helm is Lynn, who has a fascinating entrepreneur’s journey of her own, previously working at Google and in the Obama White House.
This startup hopes to entice oil extraction businesses and investors to shift from speculation toward real-time data analysis to understand the potential value of their wells. Zeno Technologies Inc. started building its platform quietly with a small team largely based in Oklahoma and California, but in October announced it planted its headquarters in the Texas capital to take advantage of the tech talent pool and to be close to the massive oil and gas industry in Houston. The company, led by CEO Sealy Laidlaw, emerged from stealth mode late last year with $5.5 million in seed funding led by Austin-based 8VC and Echo Investment Capital, the venture arm of Oklahoma-based Echo Energy, which is also one of its customers. It has also found an early adopter in Austin-based Greenlake Energy Ventures, which invests in oil and gas, renewable energy and emerging technologies. The CEO of Greenlake, Matt Gallagher, was previously chief executive at Parsley Energy Inc.
Zeno taps into a variety of oil production data to create a unified platform that it says makes drilling decisions easier. For example, Laidlaw said drillers sometimes pick spots that aren’t economically viable.
“So what we’re basically saying here is ‘Stop drilling the junk,’” she said. “Don’t drill wells that are not economic. Don’t drill wells that don’t have the return profile that you’re looking for.”
There are different levels of transparency when it comes to searching for a job. That fact is central to the mission of JobSage Inc., a different kind of job review site that focuses on providing candidates honest feedback about the culture of a workplace. Co-founders Jacob Rios, Kelli Mason and Ryan Patterson aim to answer tricky questions about pay, management and diversity and inclusion at Austin companies. As of December, JobSage had secured funding commitments for about $500,000 from 13 angel investors, Rios told Austin Inno.
With Pani Source Smart Water, CEO Allen Tsai melds a bent for entrepreneurship with a background in connected devices — he was working on the cutting edge of internet-of-things tech while at Qualcomm more than a decade ago. Pani is developing a countertop consumer device that injects flavors and nutritional supplements into regular tap water. The company, which operates legally as Pani Systems Inc., announced in November a $2.3 million seed round from investors including Clayton Christopher, Brian Sheth and Brett Hurt. Since then, Pani has added another seed investor, Tsai said: Third Craft Partners, the Austin-based invesment fund run by Brad Johnson and his father William Johnson, former H.J. Heinz CEO. Tsai declined to disclose how much additional capital was raised.
The fun historical costumes donned by Christopher Jane and Jennifer Jane might’ve helped them land a “Shark Tank” investment. But the sibling founders of Proper Good Inc. have a serious mission: helping people with dietary restrictions find convenient meals. Their company makes mail-order soups, broths and grains for those adhering to keto, gluten- or dairy-free and plant-based diets. Investing in back-end capabilities helped Proper Good prepare for a demand deluge after the “Shark Tank” episode aired in October; Christopher Jane told Inno last year the company was able to ship about 90% of orders within a week. As of November, the founders were projecting ending 2021 with more than $2 million in revenue.
Wife and husband Alex Porter and Tim Porter founded Mod Tech Labs in 2020. It has quickly gained traction with its AI-powered tools that capture 3D models from photos, video and other formats. For visual content creators, the startup’s technology can render 3D images in less time and at lower cost than most other methods. The startup was part of the MassChallenge accelerator in 2021, and it has raised about $770,000 from investors including Sputnik ATX. It is one of four Austin startups among the 45 finalists selected for this year’s SXSW Pitch contest. Coming up in 2022, the startup is working with Intel Labs to commercialize an infinitely scalable 3D file type that allows for smaller file sizes. It's also planning to announce projects for "metaverse" platforms that will help enable NFTs, virtual goods and other media.
Dialysis might not be the sexiest word in tech. But innovating to give patients easier and more effective therapeutics can improve quality of life for millions. Founded in 2020 by CEO Nikhil Shar, Chief Science Officer Hiep Nguyen and CFO Vikram Vijayvergiya, the startup has created a device called Holly. It’s an implantable hemofilter that connects to a patient’s artery in the pelvic area and continuously filters blood and connects to a wearable pouch. The startup was part of the Austin Technology Incubator, and it is among four Austin startups selected as finalists for this year’s SXSW Pitch competition.
Lack of housing is perhaps the most complicated and serious problem facing Austin. Kiro Action might have part of the solution. The local startup, led by former CIA officer Sam Haytham, has developed a small home that can be used in all sorts of ways, from temporary housing for people experiencing homelessness to pop-up hotels or backyard abodes. But the startup is decidedly focused on homelessness, particularly among veterans. The startup, which is a public benefit corporation, made a splash with its prototype in 2020. Now it’s poised to debut its latest home, which it calls the Kiro Action Glass House, at SXSW this year. “Think Apple Store design in a modern refuge,” the company’s teaser says. The startup also pledges to donate one home to a nonprofit or city government to assist with homelessness for every six homes purchased by consumers.
Study after study has shown the detrimental impact smart phones can have on kids, at least when given free reign on the internet and apps. Pinwheel has developed a kid- and teen-friendly smartphone that limits access to unsavory content and allows parents to monitor and vet what flows through the phone. The startup, founded by Dane Witbeck in 2019, landed a $3.5 million seed round from Drumbeat Ventures, Circadian Ventures and Central Texas Angel Network in 2021, and it was picked as a finalist for this year’s SXSW Pitch in the Social & Culture category.
Terradepth is developing an unmanned submarine and data technologies to map the ocean floor — or anything underwater. Founded in 2018 by Joe Wolfel and Judson Kauffman, who met while in Navy SEAL training, the startup has spent years in research and development. Last year, the company put its hardware and software to the test in Lake Travis. With $8 million in funding since 2019, plus new funding commitments in hand, the company has been building up its executive staff. Its business model, which it calls ocean-data-as-a-service, has a wide variety of applications, especially for ocean-based energy production, communications and environmental research. The startup is also considering adding sensors to monitor chemical and environmental particles to pair with its mapping data to pick up on patterns that might otherwise go overlooked.
Loop wants to make auto insurance more transparent and rates more equitable. That means it doesn’t base rates on credit scores — it doesn’t even check them. Same goes for income and education. Instead, the company looks at road safety data where you spend the most time driving, accident data and driver behavior. Founded in 2020 by John Henry and Carey Anne Nadeau, the startup raised a $3.25 million round of funding in early 2021. It raised an additional $21 million round last fall on the heels of announcing a multi-year reinsurance agreement valued at $30 million. Co-founder and co-CEO Nadeau is a former Brookings Institution research analyst and MIT research affiliate. Henry, meanwhile, was co-founder and venture partner at Harlem Capital, as well as co-creator and executive producer of Vice Mediaproduction "Hustle."
BluePallet isn’t your typical startup. It was formed in 2000 through a merger between chemical marketplace company EchoSystem and fintech company Velloci. In 2021, it landed a $5 million round of funding, largely from chemical industry executives, and moved its HQ to Austin. It connects buyers and sellers for a wide variety of materials for agriculture, pharmaceuticals and more. A big part of its value as a platform is that it vets for regulatory compliance and corporate responsibility. The company, led by CEO Scott Barrows, was also the first industrial commerce platform to operate on Alibaba.
The aftermath of death is not a simple process for grieving families. Clocr has developed an all-in-one digital legacy management and emergency planning platform to help families through the online administrative aspects of dealing with a loved one’s passing, including accessing passwords and other digital assets. It also helps users set up power of attorney. The startup was founded by University of Texas student Apoorva Chintala and her father, Sree Chintala, after the passing of her grandfather. Last fall, it raised about $539,000 in a crowdfunding campaign on Republic. Clocr was also featured on “Meet the Drapers” with well-known investor Tim Draper. It won second place in the undergraduate field of the Female Founder Pitch Competition at the Kendra Scott Women’s Entrepreneurial Leadership Institute at UT.
At Ease Rental Corp. runs a home rental platform for military members and other federal employees. Founded by Anthony Gantt, At Ease was born out of the experience Gantt and his family had moving from place to place when he was with the Marines. The startup raised about $304,000 in a crowdfunding campaign on Republic, and it was part of Texas Venture Labs’ fall 2021 cohort. Ganntt also was the inaugural winner of the Dream Startup pitch competition hosted by Q2 and Austin FC, which earned him earned $100,000 in June. In early 2022, it filed paperwork tied to a $1 million funding round, and it has been growing its team since.
Poppi is an Austin newcomer. The startup, founded in Dallas by married co-founders Stephen Ellsworth and Allison Ellsworth, launched its prebiotic soda lineup in 2020. The company quickly gained traction, distributing at Whole Foods, and last summer landed a $13.5 million funding round to fuel its expansion. Investors included Austin’s CAVU Venture Partners, as well as celebrity investors including the Chainsmokers, Russell Westbrook, Halsey, Ellie Goulding and Kevin Love. The company’s products are sold in more than 7,500 stores, including locations of Kroger, Target and Sprouts, with plans to go in all Florida locations of Publix.
Austin-based firmware security startup NetRise Inc. has operated largely in stealth to this point. But its early funding, a $6.8 million round in November, and an experienced founding team hint at big things to come. The company was formed last year by co-founders Thomas Pace and Michael Scott. It has a platform that "provides comprehensive insight into the many risks present in a firmware image," according to its website. Pace was most recently vice president of global enterprise solutions at BlackBerry. Scott was most recently a senior software developer at Tanium.
Eggschain uses blockchain tech and genetics data to help people undergoing in vitro fertilization. Founded in 2018 by CEO Wei Escala, the company has struck partnerships with major clinics, including well-known fertility clinic Boston IVF. Escala, who previously worked at Procter & Gamble, Valvoline and Kraft Foods, has also stored her own eggs on the blockchain on the company's platform. Eggschain LLC has also patented its blockchain-based bio-specimen management system. The company, which was part of Capital Factory’s VIP accelerator program, was also a 2019 SXSW Pitch finalist.
Evo Security started off 2022 with a $3.9 million seed round led by Sorenson Ventures, Inner Loop Capital, Secure Octane, Channel Angels and other angel investors. The cybersecurity startup, founded by Michael Roth, helps managed service providers protect small to medium-sized businesses through comprehensive identity and access management solution. Evo Security expects to use the fresh funds to expand features, build out a partner success and support team and improve its existing security capabilities.
Xebec Inc. arrived in the public consciousness with a product that’s easy to wrap your head around: what if your laptop could have two additional screens? The startup, which makes monitors that can be attached to a laptop, was founded in 2018 and generated roughly $6.5 million in revenue between March 2020 and June 2021, CEO Alex Levine told ABJ last summer. Sales have been bolstered by the rise of remote work during the Covid-19 pandemic, and the young company has been profitable since June 2020. Watch out for continued growth for the company, which in 2021 moved into a new East Austin office at 500 San Marcos St., next to Wright Bros. Brew & Brew.
Finally, check out highlights from some of the startups we've featured on past Startups to Watch lists.
