A few years ago, Austin's startup ecosystem didn't seem to have enough early-stage venture capital to fuel its huge crop of startups. But that has been rapidly changing with the emergence of new funds and the expansion of out-of-town VC firms into the Austin market.
June was packed with big funding rounds and major acquisitions. A few highlights include the $47 million Series C local sports broadcasting startup FloSports landed; a $26 million round for compliance automation software company ClearData; and the $25 million Arrive Logistics reported.
Meanwhile, Data.world made a major acquisition involving a fellow Austin startup; Amazon scooped up some local ad tech; and WP Engine acquired Flywheel in perhaps the largest ever deal in the WordPress world.
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Now, let’s get to the details of the VC funding, mergers and acquisition and venture capital firm activity.
Fundings
Sporting event and digital content startup FloSports closed a $47 million Series C funding round to lock in contracts with new leagues and sports organizations. The new investment was led by New York-based media giant Discovery Inc. FloSports’ existing investors, including Causeway Media Partners, LP, Fertitta Capital, and DCM Ventures, also pitched in on the round — as did World Wrestling Entertainment and Bertelsmann Digital Media Investments.
Liveoak Technologies, an Austin startup that integrates a variety of software used to complete financial transactions in the digital space, has closed an $8 million Series A round. It was led by Austin’s S3 Ventures, with Seven Peaks Ventures, Wild Basin Investments, State Farm Ventures, Northwestern Mutual Future Ventures, and Broadhaven Capital Partners all pitching in, as well.
Local AI security camera startup Athena Security secured a $5.5 million seed round led by Pathfinder, which is part of Founders Fund. The deal also had the backing of about 40 angel investors. Athena Security uses computer vision and other technologies to monitor and detect potential threats, such as someone carrying a weapon.
Aunt Bertha, a B-Corp that helps people quickly find free and reduced cost social services, reported raising $16 million in equity funding. The round was led by Noro-Moseley Partners with participation from Digitalis Ventures, Techstars Ventures, Techstars Impact, Capital Factory as well as other prior investors.
Austin-based clinical trials marketplace startup SubjectWells reported raising a $10 million Series A funding led by Windham Venture Partners. Prior investors Healthy Ventures and Geekdom Fund were also in on the round. The company plans to use the money to expand into new markets in Europe and South America.
Arrive Logistics announced it has secured a $25 million Series B funding round led by its mainstay investor, Lead Edge Capital, which has offices in New York City and Santa Barbara, Cali. The startup, founded in 2014 by CEO Matt Pyatt and President Eric Dunigan, uses matching algorithms to pair shipping companies with businesses that are looking to get their products to new places.
Enboarder, a software company providing customized onboarding of new hires for clients including McDonald’s and Verizon, announced it has raised an $8 million Series A led by Greycroft and Austin-based Next Coast Ventures, with participation from Stage 2 Capital. And with the new funds, the Sydney-based company announced it is making Austin its U.S. headquarters.
GigaOm and iForetold publisher Knowingly Corp reported raising $3.2 million in new equity funding. The web publishing company, led by Bryon Reese, has previously reported several other funding rounds totaling $7 million, dating back to 2014.
Mobile Tech RX, an Austin startup making invoicing and pricing software for auto repair shops, has raised $4.2 million in new funding led by Silverton Partners. The new money is being used for new hires in sales and software development.
Austin startup Eterneva, which turns cremated ashes into diamonds in a personalized package, raised $1.2 million in funding from a group of notable local angel investors. Those include Brett Hurt (Data.world), Dan Graham (Notley), Eric Korman (Phlur), Brant Barton (Bazaarvoice), David Rubin (Ojo Labs), Brian Cruver (AlertMedia), Manish Patel (Nutrabolt) and John Banczak (Turnkey).
PHLUR, which sells perfumes, candles and body care products through its website and at Sephora and Credo, raised a $7 million Series A. The round was led by fragrance giant Symrise Inc and including continued backing from Austin’s Next Coast Ventures and a new investor, Belcorp, which is a large beauty company in South America. Along with the funding, the company announced it has acquired Austin-based Texas Beauty Labs, which is changing its name to The Goodkind Co.
Remedy, founded in 2016 by CEO Jeremy Gabrysch and his wife and director of business operations Christina Gabrysch, raised $10 million in new investment to expand its services. The round was led by Austin-based Santé Ventures. And, as part of the deal, Santé Ventures managing directors Joe Cunningham and Doug French will join Remedy’s board of directors.
ClearData, an Austin company that makes compliance automation software for the healthcare industry, has raised a $26 million Series E round. That brings its total raised since 2012 to $81 million. The business was founded in Phoenix, but it moved to Austin in 2016 and has about 120 employees here.
Mergers, Acquisitions and IPOs
Amazon has acquired the ad server portion of Austin-based Sizmek, giving Amazon a powerful new tool to compete with ad server giant Google. AdAge reported that a source said Sizmek had been seeking around $30 million for the tech after filing for bankruptcy in March.
SmartDog Services, an Austin company that helps customers use Oracle products, is being acquired by Boston-based Apps Associates, a cloud migration and managed services company. No financial details were provided. SmartDog doesn’t appear to have raised any venture capital.
Locally based supply chain and logistics company E2open is continuing its shopping spree. The company, which recently closed a $425 million deal to acquire Amber Road, today announced it has another acquisition to share. It is acquiring Averetek, a marketing automation company, for an undisclosed amount. As part of the deal, Avertek CEO Peter Thomas, will join E2open as VP of channel strategy.
Locally based identity security company HID Global secured a deal to acquire the international ID solutions business of De La Rue, an England-based business that provides secure ID documents in 25-plus countries. No financial details were provided. The deal is expected to close by Q3. HID Global, which was founded in 1991 and acquired by ASSA ABLOY in 2000, now has 3,000-plus employees worldwide.
Austin's Data.world acquired Capsenta Inc., an Austin data analytics startup that spun out of the University of Texas, for an undisclosed amount. Capsenta develops software that integrates disparate databases using semantic-web technology. The deal will allow businesses to securely access, view, and work with on-premises databases in the cloud.
Locally based fintech company Q2 Holdings’ secondary stock offering brought in $527 million-plus via 3 million shares sold at $69.50 and convertible bonds, the ABJ reported. Big investment banks Morgan Stanley and J.P Morgan Securities underwrote the deal, with BMO Capital Markets Corp buying convertible bonds. The deal could fuel some acquisitions. Q2’s market cap is now at about $3.6 billion.
Locally based WordPress services company WP Engine is acquiring Omaha-based WordPress hosting company Flywheel. No financial details provided, but the companies said it is the largest acquisition ever in the WordPress industry. The combined company will now be used by 120,000 brands globally. Flywheel has about 200 employees globally. The move comes about a year and a half after WP Engine landed a $250 million commitment from private equity firm Silver Lake.
Venture Capital Firm Activity
Springdale Ventures, a relatively new venture fund for consumer packaged goods, reported raising $4.8 million of a planned $35 million investment fund. The fund, founded by Notley founder and former BuildaSign.com CEO and founder Dan Graham and former SKU managing director Genevieve Gilbreath, initially announced it would launch with a $20M fund back in February. At the time, it said the fund would back about 25 early-stage consumer companies.
Elsewhere Partners, a relatively new firm led by Austin Ventures General Partner and AVX Partners Founder Chris Pacitti, Austin Ventures General Partner John Thornton and Bain & Company senior associate consultant Sam Kentor, reported raising $70 million to back startups across the nation. The firm, which has already made several investments, had initially filed paperwork with the SEC that indicated plans to raise a $100 million fund.
Austin-based Multicoin Capital co-led a $15 million Series C round for IoT startup Helium along with Union Square Ventures. Others on the round included Khosla Ventures, GV, FirstMark Capital and Munich Re. Helium makes a hotspot that connects to home WiFi networks to improve communications of IoT devices.
Austin investment firm BuildGroup led a $25 million Series B round for New York-based video ad startup VidMob. The company’s tech stack helps marketers develop high quality ads with a team of content creators and data tech to improve the reach of campaigns. BuildGroup, led by former Rackspace CEO Lanham Napier, raised $330 million in 2018 with plans to back about 10 companies.
San Antonio-based Geekdom Fund, which has made several investments in Austin startups, reported raising $40 million for its Geekdom Fund III. Its SEC filing indicates it might look to raise another $10 million to hit its total offering of $50 million. Geekdom’s partners include Don Douglas, Michael Girdley, Mike Troy and Cole Wollak.
*Editor's note: A prior version of this story incorrectly stated ClearData's funding. It has been corrected.
