Austin's August was hot in pretty much every sense. Along with one of the biggest funding rounds of the year -- a $60 million haul for ScaleFactor -- there were roughly a dozen startups that landed significant investments to fuel their futures.
Meanwhile, a venture capital fund focused on edtech is raising new investment, and there were several big acquisitions, including long-time Austin tech company Spiceworks.
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Now, let’s get to the details.
Fundings
Tethr, which files paperwork as CollabIP, reported raising $11 million in equity and debt funding from a single investor. It’s not clear who the investor was. Tethr’s $15 million Series A in 2017 was led by Grotech Ventures and MissionOG, as well as some strategic investors. Tethr, which is led by CEO Mike Mings and President and COO Rick Tober, uses AI to provide analysis and insights on audio conversations.
Helper Bees, an Austin startup that helps connect seniors with cost-effective helpers, reported raising about $500,000 in new equity funding. The startup was founded by CEO Char Hu, COO Eric Corum and CTO Danny Lynch. The startup had previously raised $120,000 from Techstars and Right Side Capital Management, according to Crunchbase. Later in the month, the startup reported raising $1 million in new equity funding.
AppClose, a co-parenting app that helps parents manage child care across multiple families, reported raising about $500,000 in equity funding from a single investor. The company was founded in 2015, and it’s led by Igor Litinsky. It reported raising about $600,000 in August last year, and had prior rounds of about $505,000 and $335,000.
Infinitum Electric, which makes high-efficiency electric motors, reported raising $6.4 million in new equity funding. Today’s filing follows a $1.8 million Series A round led by Cottonwood Technology Fund in January. The startup, founded in 2016, has been focused on the HVAC industry. The company, which has now raised a little over $9 million, is led by CEO Ben Schuler.
Upland Software, a publicly traded enterprise workplace management software company, announced it landed a $410 million credit agreement to refinance its debt and fuel future growth. Of that, $350 million is a senior secured term loan B that matures in 2026. Upland has been on an acquisition tear, gobbling up 20 or so companies in recent years.
ScaleFactor raised a $60 million Series C in what was the largest deal we’ve spotted since local construction finance startup Billd raised a $60 million Series A in January — and, then just days before that, legal tech startup Disco‘s $83 million Series E. ScaleFactor’s raise, however, is more impressive in a way — coupled with its Series B earlier this year, it means the startup has raised $100 milllion in 12 months. The latest round was led by Coatue Management, a New York-based tech sector hedge fund that has made investments in Square, Shopify, DoorDash, Uber and Lyft. ScaleFactor plans to double that over the next year, with an emphasis on product and engineering jobs.
Advanced Scanners, an Austin company making a 3D optical vision platform to track brain movements during brain surgery, announced it has raised a $1.5 million seed round. It was led by Flatrock Investments JV, with additional backing from members of the Central Texas Angel Network and Capital Factory — as well as some individual angel investors.
Joust, an Austin-based banking platform for freelancers, entrepreneurs and the self-employed, announced this morning that it has raised a $2.6 million seed round. The startup is designed to protect freelancers against late or missed payments, offering a suite of tools and a platform for managing and handling invoices. The funding was led by PTB Ventures, a NYC early-stage venture firm focused on companies in the digital identity ecosystem, and included participation by Accion Venture Lab, Financial Venture Studio and Techstars. According to the startup, the capital will be used to expand its platform to serve its growing freelancer segment.
Alegion, an Austin startup helping prep data for AI, raised a $12 million Series A-2 funding round led by RHS Investments, a San Francisco-based firm.
AgencyKPI, an Austin insurtech startup, emerged from stealth and announced it has raised $3 million from insurance networks and insurance executives. The startup, founded in 2017 by Trent Richmond and Bobby Billman, has been quietly working on its business intelligence platform and building up network clients, including Keystone Insurers Group and Pacific Interstate Insurance Brokers.
Coherent Logix, an Austin-based company making low-power processors, reported raising $3 million in new equity funding from a single investor. The company, led by founder and CEO Michael B. Doerr, appears to have been founded in 2005.
BrewBike, which was based in Chicago and was launched out of Northwestern University in 2015, started slinging its cold brew coffee from custom cargo bikes on UT’s Austin campus earlier this year. And, in August, it filed a Form D indicating it is now based in Austin and has raised $1.5 million in equity funding.
Molecula, an Austin data virtualization startup, announced that it closed a $6 million seed round to bring its AI-accelerating software to more big brand clients. The oversubscribed funding round was backed by The Seraph Group, Lontra Ventures, Velar Capital, Capital Factory, Andrew Busey and Jason Dorsey. The investment adds to the $4.5 million Austin Inno reported on in May, which included backing from Hypergiant Industries co-founder Ben Lamm, as well as Tony Robbins, Tom Meredith and John Porter.
Austin-based Yotta, which provides energy storage technology, announced it has raised a $1.5 million seed round from angel investors and the SWAN Impact Investment Group. It also landed about $300,000 in grants for commercialization of its SolarLEAF, which stores solar energy.
Cerberus Interactive, an Austin mobile game maker founded in 2017 by Sami Khan and Beau Button, reported raising $1.75 million in new funding. The round was co-led by Mobilityware, Reddit co-founder and CEO Steve Huffman and TikTok‘s Blake Chandlee. Cerberus’ funding comes as it works on its flagship game, “Atlas Empires.” About a year ago, the startup reported raising $1.3 million from 33 investors via simple agreements for future equity — or SAFE notes. Last year, it reported raising $130,000 on top of a prior $70,000 round of SAFE notes.
RoverPass, an Austin startup that bills itself as the “RVer’s online travel agency,” reported raising about $827,000 in new equity funding. It wasn’t immediately clear who invested. The funding comes as the company is launching its reservation management system. And it follows investment from Capital Factory and ATX Venture Partners, whose co-founder Chris Shonk is on the company’s board.
Mergers, Acquisitions and IPOs
Austin childcare management software startup Preschool2me is being acquired by Las Vegas-based SmartcareOS. The startup, founded in 2012 by Kapil Rajurkar, went through the Capital Factory Accelerator program and won a 1776 Challenge Cup in 2015. It had raised an unknown amount of seed funding from angel investors, including Jawahar Dhandapani, Sandeep Karandikar, Srinu Vemulapalli, Tarun Singhal, Tarun Sharma, Vipin Agrawal, Umad Ahmad, Vinay Arora and Saurabh Dixit, Silicon Hills News reported.
Spiceworks, an Austin company that has a marketplace and network for IT professionals, is being acquired by New York-based Ziff Davis B2B, a global marketing company that operates brands including Mashable, PCMag and Offers.com. Financial details weren’t provided. The deal led the companies to layoff 59 employees in Austin. Spiceworks was founded in 2006 by Scott Abel, Francis Sullivan, Greg Kattawar and Hallberg.
Austin-based social media marketing and ad agency Best Practice Media is acquiring Austin-based social media agency Social Distillery. Social Distillery was founded in 2011 by CEO Kristen Sussman, who will remain active as a researcher and as an advisory board member. Best Practice Media was founded in 2015 by CEO Claire Winslow and is perhaps best known for its annual Social Media Week Austin conference.
Austin-based Upland Software, which makes workplace management software, has acquired Canadian telecom software company Cimpl for $23.1 million cash and $2.6 million cash holdback payable over the next year. Upland said it expects to add $8 million in annual revenue as result of the deal. The acquisition, one of more than 20 by the company, comes weeks after Upland landed a new financing deal to fuel acquisitions.
Austin-based Epicor Software Corp, which is owned by private equity firm KKR & CO, may be sold for as much as $5 billion, according to a Reuters report in late August. The price point includes debt. KKR didn’t comment on the report. KKR scooped up Epicor from prior owners Apax Partners in 2016 for $3.3 billion.
Palo Alto-based cloud software giant VMware plans to scoop up Waltham, Mass.-based endpoint security company Carbon Black in an all-cash deal worth $2.1 billion, the companies announced. VMware is also planning to pick up California-based Pivotal Software, in which Dell also owns a stake, for about $2.7 billion.
Kony, an Austin-based digital app platform, has been acquired by Switzerland banking software giant Temenos for an enterprise value of $559 million and a reported earn-out of $21 million. The deal is subject to regulatory approval. Kony, which was founded in 2007 and has raised just over $150 million in funding, is behind Kony DBX, its suite of leading mobile banking apps.
VC Firm Activity
Socratic Ventures Education Partners, an Austin-based venture capital firm founded in 2010 by Student Loan Genius co-founder Joshua Pierce, filed SEC paperwork indicating it is raising a new fund — although it didn’t set a target amount. The firm’s website shows it incubated and co-founded College Consortium and co-founded Vault, which used to be known as Student Loan Genius. It also has Frisco, TX-based Meritize and San Francisco-based MeasureOne in its portfolio.
Locally based VC firm ATX Venture Partners co-led a $1.5 million seed round for Houston-based bulk commodity shipping software startup Voyager.
Serent Capital, a private equity firm with offices in Austin and San Francisco, has made an undisclosed investment in Davisware, an ERP software company for food equipment service, HVAC and other speciality trades that’s based in Dundee, Ill.
Quansight Futures is launched Quansight Initiate, an early-stage investment fund that will invest in startups that are using open-source technologies and are active in education, IOT, data-management, data-science, machine-learning and AI. Quansight’s fund is being managed by former University of Utah information systems professor Bradden Blair. The team expects to raised $20 million for the fund and have it fully funded within nine months. And it’s already active, with investments in Tenavox, Anaconda, AutoAuto, OpenTeams, SaveDay, FairOSS and Vertalo. Quansight Futures is an Austin open source machine learning startup founded by Anaconda founder Travis Oliphant.
