Minneapolis-based startup Fulcrum, which has a platform that acts as the “mechanical mind for manufacturing facilities,” raised $18 million in Series A2 funding.
While the funding helps stabilize the company on its growth trajectory, CEO Sunny Han told the Business Journal it’s a challenging time for founders.
“Probably the worst fundraising environment that most of the other founders that I’ve talked to have seen,” Han said. In previous rounds, investors wanted to take deals as quickly as possible. In this cycle, which lasted about four months, most investors wanted to meet, and they wanted due diligence at a much higher rate. “It was a lot more work,” he said.
With the funding goal met, the company has some runway. Fulcrum users grew by 130% last year and Han thinks this year will exceed that growth rate. But with lower valuations, it’s been harder to celebrate any victories.
The latest funding round brings Fulcrum to a total of $39.9 million raised. Since the last funding round, which closed in 2019, the number of Fulcrum customers grew more than sevenfold.
The company was in a hiring freeze but is now looking to add workers in some strategic areas. The added capital gives Fulcrum a chance to conduct more focused marketing and work on partnerships.
The funding round was led by Bessemer Venture Partners and had participation from existing institutional investors Battery Ventures, Motivate Venture Capital and Schematic Ventures, along with Waybury Capital as a new investor. A variety of individual investors also participated.
Founded by Han in 2015, Fulcrum’s software-as-a-service platform acts as an operating system for a manufacturing facility. It automates decisions like what to build, when and how much of a product to build, who should buy it and other processes.
Han said it’s done in a way that’s really focused on people, and he doesn’t think entire manufacturing processes will be automated anytime soon.
“We hope that we can continue to build really great things and add value to manufacturing,” Han said. “We hope that more and more talented people realize how important manufacturing is and make the choice to apply their work and their effort to this problem.”
