A St. Petersburg company has closed a $7.5 million Series D to further delve into its artificial intelligence offerings.
3D Cloud by Marxent, which offers a platform to visualize room designs in a 3D space, announced the raise on Thursday. Arnie Bellini, who co-founded and headed up Clearwater-based ConnectWise, led the round. Bellini has served on the Marxent board since 2020.
"The company has exceptional leadership, a massive product catalog, top brands and retailers, and a compelling vision for bringing this tech to new audiences," Bellini said in a statement. “3D Cloud by Marxent’s solutions drive both top-line growth and bottom-line savings for retailers regardless of economic conditions."
While company funding rounds usually become larger — Series Bs are traditionally smaller than Series Cs, etc. — Marxent has continued to decrease its rounds as the years have passed. In 2016, the company raised a $19 million Series B, with a $13.4 million Series C in 2021, which Bellini also led.
The company said it has ballooned to a $135 million valuation with the additional funding.
The latest round was intentionally smaller than its predecessors, according to Marxent CEO Beck Besecker.
"We’re moving into profitability, and the need for financing is not the same as it was," Besecker said in an exclusive interview with the Tampa Bay Business Journal. "As we move toward profitability, the need for financing isn’t nearly the same as a Series C; this is a specific financing to invest in specific innovation."
Previous investors have included Dan Gilbert, co-founder of Rocket Mortgage, and Lee Arnold, who heads up numerous ventures, including serving as chairman of Colliers International Florida, Besecker said. The duo, along with Bellini, serve as a stark contrast to the typical venture capital firms that expect relatively quick results post-investment.
"These are all guys that have all been entrepreneurs, all built their own business, and all think very long term," Besecker said. "They don't think in blocks of one or two years like a VC would; they're thinking of building a legacy business to be here the next 50 to 100 years like they did."
That distinction is crucial in economic uncertainty, even in a space that is as widely watched as artificial intelligence.
"Having entrepreneurs and operators on your board who are investing, they look at tough economic times like a blip," Besecker said. "A VC may say, 'Stop all spending, stop hiring.' Versus [investors like Bellini] think it's a great time to get creative."
Marxent's newest push on innovation will go beyond its initial desktop application, which works with big-box home retailers like Lowe's. The tools will be placed in a browser that is more easily accessible to users. It will also create automation through AI and its technology to be intuitive for homeowners to swap out potential designs and furniture pieces easily.
“The idea an average homeowner will understand a kitchen catalog is way too much to ask,” Besecker said. “And you can collaborate [more effectively]. It’s the whole modernization of how people want to work, not going in to sit next to someone in a store.”
The expansion in its tech will allow the company to break beyond the retailer space, Besecker said, bleeding into the independent designers and eventually into designer-adjacent sectors, like homebuilders.
Artificial intelligence is the hot sector to watch in 2023; it was the theme for the Miami-based eMerge Americas tech conference in April, and tech giants like Google and Microsoft have doubled down on their AI technology.
“I’ve been through several hype blips with augmented reality and the metaverse; I was also there with e-commerce at the very beginning,” Besecker said. “My observation is nearly everything that comes out is overhyped initially, then it becomes a non-topic and gets out of the general press, then ends up much bigger than anticipated.”
