💫 Ramplify: February Files
Stage of Australian Tech, Distillation, AI MVPs, Liquidity Moment
(Rampersand Partner Taryn Pieterse on panel discussing The State of Australian Startup Funding Report 2024)
👀 A Big Week of Data by Paul Naphtali
Two significant ecosystem reports hit within 24 hours last week: Cut Through Venture & Folklore’s State of Australian Startup Funding and Techboard’s Australian Startup Funding in Review. Both reported $4 billion ($4.1b by TechBoard, but what’s $100m between friends?!), marking a return to growth in Australia’s startup funding world.
The headlines have flowed, mostly around the growth of the ecosystem, with 2024 being the third or fourth largest funding year (depending on the report), but also discussions around the lack of funding for women, the decline in NSW funding, and the increase in startup deaths.
Digging in a little further, you can see that early-stage capital (pre-seed, seed, and series A) is stabilising, although it is still down on the boom years of 2020/2021. In aggregate, though, between $1.5b and $2b was invested at those stages, which is orders of magnitude beyond where we were a few short years ago.
This may sound like a mixed message for founders—while the market is open, it’s not the abundance of ‘free capital’ it once was. The truth is we have one of the most vibrant early-stage funding ecosystems in the world, built on top of one of the highest-quality founder communities.
If you’re thinking about raising capital, now is a great time. Valuations are up, (most) VCs are active, and the ability to build global startups from Aus has never been better.
If you’re building a startup, we’d love to hear from you - get in touch!
🗞️ Tech News:
Google’s $75 Billion AI Spend💰. Google is doubling down on AI in a massive way, planning to pour a staggering $75 billion into AI development this year. That’s a serious war chest, underscoring how critical AI is to Google’s future. CEO Sundar Pichai brushed off concerns about competition, emphasising Google’s focus on efficiency and scale with its Gemini models.
Aaron Levie on How AI Agents Will Expand the Software Market💡. Aaron Levie, founder & CEO of Box, explains how AI is breaking past traditional IT budget constraints, shifting software from an enabler to an autonomous problem solver. This unlocks new spending, as AI Agents handle tasks like marketing automation, legal contract analysis, engineering support, and sales scaling—none of which were traditionally tied to IT budgets.
📈 The impact? Software's total addressable market (TAM) grows exponentially, as industries like legal services (currently a $400B US market) see AI-driven efficiencies that could 5-10X software spend in the space. The same logic applies across industries, making software markets vastly larger than ever before.
Lex Fridman’s Deep Dive on AI’s Future 🧠. Lex Fridman’s 5-hour conversation with Dylan Patel at SemiAnalysis and Nathan Lambert of Allen AI covers DeepSeek, China, OpenAI, NVIDIA, xAI, Google, Anthropic, Meta, Microsoft, TSMC, Stargate, megacluster buildouts, RL, reasoning, and more cutting-edge AI topics.
New Threat To Foundational Models - Distillation🤖.Researchers from Stanford and the University of Washington have achieved a remarkable feat by training an AI model, named s1, that rivals OpenAI's offerings in just 26 minutes and for under $50. They used a distillation technique to refine s1 with answers from Google's Gemini 2.0 model. Notably, s1 outperformed OpenAI's o1 model on competitive math questions by up to 27%. With the right approach, startups and researchers can quickly train competitive AI models without needing massive budgets or infrastructure.
🛠️ How to Startup:
AI & MVPs. Building an MVP has never been easier with AI. Lawrence Jones explains how AI can help founders get their first version off the ground faster, whether generating code, automating workflows, or even validating ideas with AI-powered market research. The key takeaway? AI doesn’t replace the need for great product thinking—it just removes a lot of the grunt work, letting founders focus on what matters. If you’re not leveraging AI in your early-stage build, you’re leaving speed on the table.
Do Things That Don't Scale. The best startups break the rules in the early days, focusing on raw execution rather than polished perfection. Geoffrey Huntley reminds us that success often starts with scrappy, hands-on work—whether personally onboarding users, manually delivering services or hacking together solutions before automating. This approach lets you deeply understand customer pain points and build something people truly love.
1. Start Scrappy – The best founders roll their sleeves up and do things manually before automating. Directly engaging with early users gives you insights no survey ever will.
2. Customer Love > Efficiency – Before worrying about scale, obsess over solving real problems for a small group of passionate users. If they love it, they’ll spread the word.
3. Scale Comes Later – Premature scaling kills startups. Nail product-market fit first, then determine how to systematise and automate growth.
👕 VC in Australia/New Zealand:
Important Year For VC Funds. Aussie startups pulled in $4B last year, but it’s crunch time for many VCs. Only 23% of investors closed a fundraise in 2024, with smaller funds hit hardest as private backers reach their limits and institutional capital remains cautious.
“The venture model works when capital flows. When it stops, it gets ugly,” says Rampersand GP Paul Naphtali.
The rise of “zombie” VCs—managing old bets but unable to raise fresh capital—means 2025 could be a make-or-break year. The bright spot? AI, health tech, and climate solutions are heating up, and 74% of investors expect more deals ahead.
Startmate's Largest Summer Accelerator Welcomes 16 Startups. Startmate has announced its Summer 2025 Accelerator cohort, featuring 16 diverse startups led by 28 ambitious founders. These ventures aim to tackle challenges ranging from enhancing Gen Z connectivity to integrating surplus textiles back into the economy. he program will culminate in a Demo Day in May.
Deepseek to empower Australian founders. Our Partner Andrew Poesaste describes it as "a transformational moment for vertical software companies". This is a boon for Australian start-ups. Why? It delivers OpenAI-level reasoning at 1/30th of the cost, plus it's open source with lightweight versions available. TLDR: lower capex and increased capability = more products can built. Let's go! 🚀
"Australian startups in verticals from agriculture, climate, education, and industrial to healthcare will benefit from dramatically lower costs to access higher intelligence AI capabilities," he says.
🤩 Portfolio News
Sendle’s founding story. James’ sought to donate his sons' outgrown clothes, leading him to create a gifting marketplace. This initiative evolved into Sendle, a parcel delivery service that has now assisted over 400,000 Australians by offering a cost-effective alternative to traditional postal systems. And turned it into a global shipping solution, delivering packages across Australia, the US, and Canada, all in a carbon-neutral way.
(Sendle founder James Chin Moody)
Sapia launches series on AI revolution in HR. Sign up to learn how HR and talent Acquisition leaders confidently navigate the hiring process in the world of AI and how to implement it in their organisation.
💼 Portfolio Job Board
Location & type: Gold Coast or Hybrid, Contract
What they do: Cake Equity is the intuitive equity platform for fast-growing startups. It simplifies cap table and equity management for startups, enabling efficient issuance of stock options, management of shareholder relations, and facilitation of capital raises.
What you’ll do: In this role, you'll drive the front end, build high-performance UIs, and help shape the Cake product. Proficiency in vanilla javascript and CSS/SCSS is required.
Performance Manager at AmazingCo
Location and Type: Remote or Hybrid (Melbourne)
What they do: AmazingCo is an experience creation company that leverages a tech-enabled platform to plan and deliver low-cost, local, socially connective activities for couples, families, friends and work groups.
What you’ll do: Work closely with AmazingCo’s Head of Paid Media & Customer Acquisition with the primary focus on helping set the paid search strategy, helping with media planning, aligning on roadmaps, providing insights from reporting and building and managing our Google Ads campaigns.
Do you have a job you’d like us to promote? Add it to Hatch and share the link with us.
See all jobs across the Rampersand Portfolio.
🌏 Rampersand Travel Diary:
Sydney: Paul will be in Sydney from 19-20th Feb, and Scott will be there from 27-28th Feb
Adelaide: Andrew and Chanie will be at SouthStart 4-5 March, reach out if you’ll be at the festival.
🎉 Upcoming Events:
MELBOURNE: Feb 13 - PICKLEBALL! Brought to you by Mayfly Ventures and Rampersand - This is a free, fun, and casual event for any skill level. Come for the sport originally designed for geriatrics, but stay for the silly season tech banter. https://lu.ma/937ck2bi
SYDNEY: Feb 13 - Fearless Founders Feast. Taryn is hosting a small dinner for founders who identify as female and non-binary and are preparing to raise their pre-seed or seed rounds in the next six months. Seats are very limited but register here if you are interested. https://lu.ma/q07nqiod
MELBOURNE: Feb 20 - Future Horizons Festival 2025. Exploring the worlds of Technology, Society, and Entertainment with “Ted Talk” style keynotes and panels of Australia’s most creative technologists. https://www.eventbrite.com.au/e/future-horizons-festival-2025-tickets-1080042970599?aff=erelexpmlt
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