Austin startups had an exceptionally prosperous 2019.
The local tech ecosystem has a lot to celebrate. But there's not much question Rigup stole the show, raising a $60 million round early in the year and following it up with a whooping $300 million round with a reported $1.9 billion valuation, vaulting it easily into the stratosphere with other tech unicorns.
Meanwhile, SparkCognition, a local artificial intelligence company, landed a $100 million Series C with a reported $770 million valuation at the time.
With rounds like that, Austin startups had raised more venture capital funding three quarters of the way through 2019 than they had in all of 2018. We might hit the $2 billion mark for the full year, which would follow the $1.5 billion raised during 2018.
But we'll get to the totals later. Now, let's take a look back at the top deals of each month of 2019.
January
Legal tech startup DISCO had only been in Austin for a few months. But it quickly earned the distinction of being one of the top legal tech companies in Austin — and the nation. In January, the company announced it raised $83 million in funding in what it said was one of the largest financing rounds ever for a startup in its sector. The investment round was led by Toronto-based Georgian Partners. Prior investors Bessmer Venture Partners, LiveOak Venture Partners, The Stephens Group and venture debt firm Comerica also pitched in. That brought DISCO to $135 million in total funding, which it said made it the highest funded enterprise legal tech company.
Billd, which had been in stealth mode for months, announced it raised a $60 million Series A round, which includes debt and equity funding. It wasn’t clear how much falls into each category. The new round was led by LL Funds, a Philadelphia-based investment firm focused on consumer finance solutions.
RigUp, an Austin startup that has created a marketplace for on-demand services and labor in the oil and gas sector, raised $60 million in new funding led by Founders Fund, a San Francisco venture capital firm founded by Peter Thiel, Ken Howery and Luke Nosek. Bedrock Capital and Quantum Energy Partners were also in on the round. Axios, which first shared the news, reported that the $60 million round was raised at a $300 million post-money valuation. It foreshadowed an even bigger round to come later in the year.
January was such a boomy month that consumer cash-back startup Dosh, which raised $40 million; accounting automation startup ScaleFactor, which raised $30 million; and emergency communications software startup AlertMedia, which raised $25 million, didn't even crack the top three. See all the January deals.
February
SpyCloud, an Austin cybersecurity startup, announced $21 million in Series B funding led by Microsoft‘s venture fund M12 to hire new security researchers and expand sales. The company, founded in 2016 by Ted Ross and Dave Endler, previously had announced a $2.5 million sed round, which was followed by a $5 million Series A in 2018.
Pinpoint, an Austin startup that makes a data analytics platform to help businesses get insights into how their dev and engineering teams are doing, secured a $13.5 million Series A round of funding led by Bessemer Venture Partners. Seed investors Storm Ventures, Boldstart Ventures, Bloomberg Beta, Slack Fund, Social Capital and Cherubic Ventures also got in on the round, which brought the startup’s total funding to $16.5 million.
Datical, a database release automation company, raised a $10 million Series C funding round led by Cincinnati-based River Cities Capital Funds, a new investor. It appeared to be the first Austin investment for the investment firm, according to the portfolio on its website. Existing investors S3 Ventures and Mercury Fund also pitched into the new round.
March
Austin-based Magnitude Software, which develops software to make sense of fragmented datasets, raised a $179 million investment round from London-based private equity firm 3i Group. Magnitude founder, chairman and CEO Chris Ney will maintain a large stake in the business. The investment came at a $340 million enterprise valuation. Magnitude was founded by Ney in 2014 when Noetix Corp. and Kalido merged.
With a fresh $45 million raised, OJO Labs Inc. executives went on a hiring spree and to expand the reach of their real estate-technology platform. Investors in the new round included Austin-based LiveOak Venture Partners, New Jersey-based Realogy Holdings Corp., Royal Bank of Canada and Northwestern Mutual Future Ventures. Those four also invested in OJO’s $20.5 million Series B round in May 2018.
Austin’s MAP Health Management, which helps combat drug addiction, raised $25 million in a round led by health insurance giant Aetna. The ABJ reported the funding will go toward hiring more than 100 people, doubling its headcount. The company is led by CEO Jacob Levenson and was founded in 2011. The company’s tech-enabled peer recovery support services and engagement help folks with addiction issues and reduce preventable healthcare cost.
April
EverlyWell, an Austin health tech startup that makes a variety of at-home test kits, announced it has closed a $50 million funding round. The round was led by Goodwater Capital, and with Highland Capital Partners joined in the round, as well. Others included Next Coast Ventures, NextGen Venture Partners and SoGal Ventures.
A Cloud Guru, founded by brothers Sam and Ryan Kroonenburg in 2015, announced it raised $33 million in growth equity funding to add to its team and develop new products and content. The investment was led by Summit Partners. AirTree Ventures and prior investor Elephant Venture Capital also backed the round. The company, which is based in the U.K. and has its North American headquarters in Austin, had previously reported raising about $9 million in a round led by Boston’s Elephant Venture Capital.
Atmosphere, an ambient television content business that spun out of Chive Media Group, has raised a $10 million Series A round led by S3 Ventures. Capstar Capital also joined the round. Atmosphere grew out of Chive when the company launched its video business. Now, TechCrunch reports, Chive TV is among the channels Atmosphere offers.
May
Three-year-old health care records startup Elligo Health Research raised $20 million in a Series C round led by Piper Jaffray Cos., the ABJ reported. That brings its total to more than $41 million. The startup helps accelerate new drug development by helping find patients for clinical trials.
Coder Technologies, an Austin-based cloud-based development platform, reported raising $10.2 million in new equity funding. It wasn’t immediately clear who participated in the round. The company was co-founded by John Andrew Entwistle, Kyle Carberry and Ammar Bandukwala. The startup raised a $4.5 million seed round last fall led by Uncork Capital and Redpoint Ventures. About a week after that filing, Coder added $1.2 million to the round.
Local biopharma startup TFF Pharmaceuticals, Inc., which is working on an inhalation drug products for chronic respiratory diseases, closed an $8.17 million Series A round. It plans to use the investment to bolster research and development of its dry powder inhaleable drugs. The company already has 30 patents and applications, and it is licensed exclusively from the University of Texas at Austin.
June
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.
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.
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, Calif. 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.
July
Locally based vacation rental management startup TurnKey Vacation Rentals announced it has raised $48 million in new funding. The round was led by Altos Ventures, which has invested in the company in prior rounds, and included investment from Adams Street Partners, Greenspring Associates and Harmony Partners. It brings TurnKey’s funding to $100 million-plus. The startup was founded by CEO John Banczak and T.J. Clark in 2013. As part of the new deal, Clark will now serve as president and chief development officer, Banczak will continue as chairman and will also serve as CEO, and CFO Jen Ford will also become chief commercial officer.
Home-buying startup Homeward, founded by Tim Heyl in 2018, is ready to accelerate its growth with $25 million in new funding. Of that sum, $4 million comes in the form of equity funding led by LiveOak Venture Partners. The remaining $21 million is debt funding led by Genesis Capital and Keystone Bank. The new funding will help Homeward build out its team, bring on new customers, add new features and expand in its existing markets in Texas, Georgia and Colorado.
TrustRadius, a software review startup founded in 2012 by CEO Vinay Bhagat and VP of Product Scott Miller, announced it has secured a $12.5 million Series C led by Austin’s Next Coast Ventures, along with continued investment from Mayfield Fund in the Bay Area and LiveOak Venture Partners in Austin. That brings TrustRadius’ total funding to about $25 million. That will allow them to expand their reach and double their existing headcount of 59 employees over the next year or so.
August
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.
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.
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.
September
Smarter Sorting, an Austin startup helping retailers chemical-level data for products and how to best reuse or recycle them, raised $17 million in Series A funding. The startup’s new funding was led by US Ecology, a regulated waste treatment and disposal company. Also in the round was RTP Ventures and other investors the company identified only as industry experts. That new cash will help it work on ways to become a top solution for consumer product regulatory classification.
ZenBusiness announced it raised a $15 million Series A led by one of its previous investors, New York firm Greycroft. Other early investors, including Lerer Hippeau and Revolution’s Rise of the Rest Seed Fund, were also in on the deal. Rosecliff Venture Partners, Interlock Partners and Recruit Strategic Partners were newcomers to the cap table. The startup, co-founded by former HomeAway leaders Ross Buhrdorf and Shanaz Henmati, uses machine learning and automation to guide new founders through corporate formation documents, legal compliance questions, financial outlines and other services.
Tethr, an Austin startup using an AI platform to provide insights from voice data, announced $15 million in new funding. The round was led by IAG Capital Partners with participation from existing investors GroTech Ventures, MissionOG and Falmouth Ventures. Along with that, the company announced that early investor and COO Gary Clark has been named CEO. Co-founder Mike Mings, meanwhile, will take on a corporate strategy role and serve on the company’s board.
October
RigUp announced a $300 million funding round — a move that puts the company in a relatively exclusive club of tech unicorns that are valued at over a billion dollars. The new Series D round of funding was led by Andreessen Horowitz (also referred to as a16z), and David George, a general partner at the firm, is joining RigUp’s board. Previous investors Founders Fund, Bedrock Capital and Quantum Energy Partners also participated, as well as newcomers Baillie Gifford and Brookfield Growth Partners.
SparkCognition, a local artificial intelligence company, announced raised $100 million in a Series C funding round led by California-based March Capital Partners. The investment values SparkCognition at $770 million, according to a September PitchBook profile. The company has raised a total of $175 million since CEO Amir Husain founded it in 2013.
Austin-based Shipwell planned a hiring surge after raising a $35 million Series B round led by Toronto-based Georgian Partners. Shipwell had raised $47 million since it was founded in 2016, including $10 million in October 2018. The company’s mission is to “connect, automate and optimize” supply chains, said co-founder and President Jason Traff. The company, which now has 88 people in Austin, has primarily operated in freight shipping but is now expanding into parcel shipping, Traff said. It also recently opened a Chicago office.
November
Real Estate Exchange, better known as REX, raised $40 million in a Series C1 round with investors including Ken Griffin, founder and CEO of financial services heavyweight Citadel LLC. REX, founded in 2015, has now raised $115 million. Other financial backers include Dick Schulze, founder of Best Buy; Gordon Segal, founder of Crate and Barrel; Jack Greenberg, former CEO of McDonald’s; and Amit Singhal, former senior vice president of search at Google.
Molecular Templates, an Austin biotech company that engineers immunotoxins to fight cancer, reported raising $15 million in equity funding. The SEC filing follows news last week that the clinical-stage company, had priced its $50 million public equity offering at $8 per share. The offering closed on Nov. 25. It plans to use the money for Phase I and Phase II clinical trials.
LawnStarter, an Austin startup that launched its on-demand mowing and outdoor services business in 2013, is already in 120 U.S. markets. And it’s poised to continue growing by adding new services, such as landscaping and pest control, with a new $10.5 million growth investment. The new funding was led by Princeton, N.J.-based growth equity firm Edison Partners. Earlier investors, including Lerer Hippeau, also contributed. The new round brings LawnStarter’s total funding to $24 million. Its early investors have included Bull Creek Capital, Techstars, Cotter Cunningham (founder of RetailMeNot) and Gary Vaynerchuk (author and chairman of VaynerX).
December
Round Rock-based Infinitum Electric Inc. raised a Series B funding round of $12.5 million. Santa Fe, New Mexico-based Cottonwood Technology Fund led the round, which included participation from Chevron Technology Ventures, AJAX Strategies, as well as other individual investors. The company makes electric motors used in heating, ventilation and air conditioning, otherwise known as HVAC, as well as in the oil and gas and electric vehicle industries.
LeanDNA, which was founded in 2011 by CEO Richard Lebovitz, raised $15 million in new funding to expand its team. it uses predictive analytics to help factories avoid shortages and be more consistent with deliveries. The new investment was led by Austin-based S3 Ventures. Also in on the new round were Next Coast Ventures and Rony Kahan, co-founder of Austin-based careers site Indeed, which backed LeanDNA’s $4.5 million Series A in 2017.
Terradepth, founded by former Navy SEALs Joe Wolfel and Judson Kauffman, is focusing its business on using fleets of autonomous subs to collect data. It plans to begin testing in the water next year, and it just raised $8 million in new funding, TechCrunch reports. The new funding comes from Seagate Technology. The startup is aiming to make deep ocean mapping, imagery and data collection less expensive using a blend of hardware, software and data science. It’s operating as a data-as-a-service business.
