G'day and welcome to your weekly edition of Overnight Success - your download on all the important things that have happened in the Aussie startup ecosystem. 🚀
Australia has a new unicorn, and for the first time, it's a quantum one.
Q-CTRL's $415 million Series C is a good excuse to look at Australian quantum, qubits, and all. For a country our size, we have a lot of serious players, and most of them trace back to a handful of university labs in Sydney.
Q-CTRL (Sydney) develops software that helps quantum computers and sensors operate properly. The real-world use today is navigation that keeps aircraft and autonomous vehicles on course when GPS is jammed. More on what that means in the Startup Retro below.
PsiQuantum, the Australian-founded, US-based company building quantum computers with photons, has $940 million from the federal and Queensland governments to build a utility-scale machine in Brisbane. It broke ground in June. The aim is a computer powerful enough to simulate molecules and materials, for jobs like discovering new drugs and designing new chemicals.
Silicon Quantum Computing, spun out of UNSW in 2017 and led by Michelle Simmons, builds quantum processors atom by atom in silicon. It's already selling a chip called Watermelon that sharpens AI predictions, and in a trial with Schneider Electric, it improved next-day energy forecasts by an average of 20%.
Diraq, another UNSW spinout founded by Andrew Dzurak in 2022, wants to build quantum chips in the same factories that make today's computer chips. Last month, it moved into the final stage of the US Department of Defence's quantum benchmarking program alongside IBM, IonQ and Atom Computing. Its payoff is further out: it's targeting a commercial system by 2029 for problems like drug design and financial modelling.
Quantum Brilliance builds quantum systems out of synthetic diamond that run at room temperature, so they don't need the giant fridges most quantum computers do. That makes them small enough to slot into a server rack next to ordinary computers and, eventually, into satellites, vehicles and robots.
👀 Headlines 👀
🏛️ The federal government will legislate mandatory safety and security protections for frontier AI companies that want to operate in Australia, with a new regulator to enforce them. (Prime Minister Announcement, Startup Daily, Capital Brief)
According to the announcement, six protections will be written into Australian AI Standards legislation, including giving independent testers access to models and requiring incident reports within set deadlines. A new targeted regulator, working with the Australian AI Safety Institute, will be empowered to issue 'significant penalties'.
It follows a rapid review into an OpenAI agent's unauthorised access to a Medicare statistics portal in June. The government accepted all 18 recommendations, one of which asks the Attorney-General's Department to examine a 'failure to prevent' offence that could make developers criminally liable.
It's early days. There's no bill yet, and the penalty sizes, reporting deadlines and timing are all still to come. The government defines frontier AI as the most sophisticated models at the cutting edge of current capability, so we're assuming it mostly means the likes of OpenAI and Anthropic. What we don't know is what it means for local companies building their own models, like Trellis Data below.
🧠 Speaking of which, Canberra’s Trellis Data has launched Agentaus 1, a 220-billion-parameter sovereign AI model for businesses and government agencies that need sensitive documents kept onshore. (Startup Daily)
Trellis describes the model as near-frontier and claims it ranks 43rd globally among foundation models (I didn’t know there were so many). Key for their customers, documents and processing stay in Australian data centres, and customer material isn't used for training. The service has been running commercially since May.
Trellis was founded in 2016 by Michael and Rachel Gately and is backed by Main Sequence. Michael Gately, the CEO, says its products already meet the safety standards the government outlined this week.
👀 Who knew Tesla chair Robyn Denholm was on the Canva board? She has held a seat since July 2024, an appointment Canva never announced. (Capital Brief, Capital Brief)
It came out after Denholm was introduced to staff as a director at Canva's first all-hands since last week's layoffs. Denholm has been a Tesla director since 2014 and took over from Elon Musk as chair in November 2018, leaving her role as Telstra's CFO to take on the role. Before that, she was CFO at Juniper Networks. (Tesla)
Closer to home, she joined Blackbird, Canva's biggest institutional investor, as an operating partner in 2021 and sits on its board. She also took Rick Baker's seat on the SafetyCulture board in 2023. (SafetyCulture)
Canva doesn't publish its board. The Information's org chart lists Blackbird's Rick Baker and Wesley Chan among its directors. (The Information)
📈 HR and payroll unicorn Employment Hero has passed $400 million in annual recurring revenue, adding $100 million in the past 12 months, and says its early bet on AI agents has spared it from redundancies. (AFR, HCA, IT Brief)
ARR is growing at 30% a year and is up more than tenfold from $37 million in September 2020. The $2 billion company says it stayed free cash flow positive, and its annual accounts show losses narrowing. It serves more than 350,000 businesses and 2.5 million employees across six countries.
Co-founder and CEO Ben Thompson says AI agents are lifting output per employee, not replacing staff.
⚡ Startup Retro ⚡
Q-CTRL raises $415M Series C to become Australia's first quantum unicorn
Founder: Michael Biercuk
Q-CTRL, the Sydney company whose software makes quantum computers and sensors more useful, has raised US$290 million (about $415 million) in a Series C that values it at more than US$1 billion.
The round was led by Salesforce Ventures, with significant participation from Bullhound Capital and Affinity Partners. Other new investors include AMD Ventures, EDGE Group, MPower Partners, SPARX Asset Management and the National Reconstruction Fund, which invested $70 million. Returning investors include Main Sequence, Square Peg, Salus Ventures, DCVC, In-Q-Tel, Lockheed Martin Ventures, Alpha Edison, Alumni Ventures and Ridgeline. Q-CTRL says the round was oversubscribed and expanded twice, and calls it the largest raise in the quantum sector for a software-focused business.
So what does Q-CTRL actually do? Quantum computers and sensors are powerful in theory but fragile in practice. The quantum bits they run on are knocked off course by heat, vibration and stray electromagnetic fields, so errors pile up before a useful calculation can finish. Most quantum companies are trying to fix that by building better hardware.
Q-CTRL, founded in 2017 by CEO Michael Biercuk out of his University of Sydney research, takes the other route. It doesn't build quantum computers. It writes the software that sits between the hardware and the person using it, using AI to tune how the machine is controlled so errors are suppressed and corrected as it runs. Because it's hardware-agnostic, the same software works across different makers' machines, and it's available to users of IBM's quantum computers through IBM's platform.
The same approach works for quantum sensors, which can measure things like magnetic fields and gravity with extreme precision but are just as easily thrown off outside a lab. Q-CTRL's marquee product, Ironstone Opal, is a quantum navigation system that determines a vehicle's position without GPS, which matters when the signal is jammed or unavailable. Q-CTRL says its sensors perform up to 100 times better in the field than the best alternative, and Ironstone Opal is being deployed with Airbus on commercial aircraft and Lockheed Martin on autonomous platforms.
The funding will go into its AI-driven software business, expansion across sectors including finance and energy, and its autonomy and aerospace programs. It has offices in Sydney, Los Angeles, San Francisco, Huntsville, Berlin and Oxford.
Due Diligence: Q-CTRL, Capital Brief, Forbes, 20-min interview with Professor Michael J. Biercuk
Alta raises $67M Series A to build blockchain rails for banks, with Airwallex's Jack Zhang as co-founder
Founders: Loong Wang, Jack Zhang, Catherine Porter
Alta, a blockchain startup co-founded by Airwallex CEO Jack Zhang, has raised a US$47.5 million (about $67 million) Series A, taking its total funding to US$80 million (about $116 million).
The round was led by Index Ventures, with GV, Blackbird, Square Peg and Capital 49, the investment firm set up by Airwallex's founders. Its earlier US$32.5 million seed round was led by Airwallex alongside Capital 49.
Formerly known as Metal, Alta is building blockchain infrastructure that lets banks settle payments around the clock while keeping the privacy and compliance controls they need. Its first product is aimed at corporate treasury teams, letting businesses earn interest on spare cash in a tokenised fund, then redeem it and convert currencies when a payment is due.
Zhang's co-founders are CEO Loong Wang, who previously co-founded blockchain protocol Ren and computational chemistry startup QDX, and president Catherine Porter, who led global partnerships for Meta's Libra digital currency project. Wang and Porter run the company day-to-day. It's incorporated in the US, with offices in Melbourne and San Francisco and much of its R&D in Australia.
Alta is a separate company, not an Airwallex subsidiary. Airwallex is its design partner and will be one of its first customers, connecting its payments network to Alta's blockchain. The funding will go into hiring engineers and compliance specialists and bringing banks and payment providers onto the network.
Due Diligence: Startup Daily, Capital Brief
Vudoo raises $22M Series B to take in-ad checkout to the US
Founders: Nick Morgan, Andrew Spalding
Vudoo, a Melbourne adtech that lets people buy products inside ads and videos, has raised a $22 million Series B. The round was led by US fund Blue Sky Capital, with several existing family office investors also participating.
Founded in 2017 by Nick Morgan (CEO) and Andrew Spalding, Vudoo sells software that turns an ordinary ad or video into a small storefront. Instead of clicking through to a retailer's website, a viewer can browse the products, add them to a cart and pay inside the ad itself, then go back to what they were watching.
Where does it show up? Mostly on the open web and on streaming TV, not inside the big social apps. On a phone or laptop, it's the video and display ads that run on publisher sites, where a checkout slides up over the content. Advertisers can buy these formats programmatically through a tie-up with the ad exchange PubMatic. On TV, where you can't tap the screen, the ad shows a QR code that opens a Vudoo-powered shop on your phone. Toy company Mattel ran an ad on News Corp's streaming service, Tubi, last year.
The pitch to publishers is that the audience never leaves their site, and to advertisers, that they can see what people actually bought after watching an ad. In a 2022 Moët & Chandon campaign with Vogue Australia, viewers could buy a personalised bottle partway through the video, and those who did spent an average of $140, compared with a typical $90 online.
Due Diligence: Startup Daily, Mediaweek, CMOtech, Vudoo
Morgan AI raises $3.65M to take the drudgery out of insolvency work
Founders: Josh Abulafia, Elle Curran
Morgan AI, a Hobart startup building software for restructuring and insolvency firms, has raised $3.65 million at a $12.5 million post-money valuation.
The round was led by Blackbird, with Black Sheep Capital, Archangel Ventures, TEN13, Side Stage Ventures and The Eights also participating. Angel investors include Voly founder Mark Heath, Advance VC founder Max Kausman, Hungryhouse's Graeme Horne and Mark Bouris.
The founding story is rather unique. Abulafia and Curran were the founders of CoLab, a restaurant delivery startup that entered into administration in 2023 after its lead investor pulled out of a funding round. Watching the EY team lose sleep over statutory reports, they decided to build something to "make their lives less miserable" and named the company after EY restructuring partner Morgan Kelly, without asking him first. EY hasn't endorsed the product, but the founders say Kelly has privately given the name his blessing.
Founded in March, Morgan AI is a system of record for insolvency practitioners. It plugs into a firm's servers, pulls the key details out of messy company records and automates the document-heavy parts of administration, leaving the judgement calls to the practitioner.
Twelve insolvency firms are using it, including WLP Restructuring and Canberra's Beacon Advisory, and another 20 are being onboarded. The five-person team aims to reach more than 100 firms by the end of next year and plans to expand into the UK while remaining based in Hobart.
Due Diligence: AFR
Aimer Farming raises NZ$3M to bring its pasture-measuring platform to beef farmers
Founder: Dr Jeremy Bryant
Aimer Farming, a Hamilton agtech that helps farmers work out how much pasture they have, has raised NZ$3 million (about $2.44 million), taking its total funding to about NZ$5.15 million since November 2024.
The round was co-led by Cultivate Ventures, the Erbacher Food Family, Pacific Channel and Agnition, with Antipodean Capital, Flying Kiwi Angels, Enterprise Angels and Angel HQ also participating.
Founded in 2023 by Dr Jeremy Bryant, Aimer combines smartphone and satellite pasture measurements with growth forecasts to guide grazing and feed-buying decisions. It's used on more than 800 dairy farms across New Zealand, Chile and the UK, and farmers have done more than 500,000 smartphone pasture scans.
The funding will go into adapting its dairy technology for beef farmers ahead of a 2027 launch, expanding its satellite measurement service and entering new markets through partnerships.
Due Diligence: Startup Daily
💸 New Fund, Who Dis? 💸
🏀 Athletic Ventures, the Sydney VC firm founded by former AFL player Matt de Boer and basketballer Matthew Dellavedova, has signed NBA champion Kevin Love as a venture partner to lead its US expansion. (Startup Daily)
Love, who is currently with the Utah Jazz, will help portfolio companies with their US push and build an investor community among American athletes.
Athletic Ventures has a $35 million first fund, 14 special purpose vehicles and a community of more than 500 athletes across 26 sports. Its portfolio includes Eucalyptus, Guzman y Gomez, Lorikeet, Hnry and Splose. De Boer says the focus stays on Australian founders.
🚀 Wins 🚀
🛰️ Adelaide's Fleet Space Technologies has launched Tau 3.8, a geological AI model that it says predicts copper resources with up to 89% less error than conventional methods. (Capital Brief)
The Blackbird-backed company trained the model on 10 million simulated underground environments to help miners find deposits and decide where to drill, and is working with Nvidia on the compute behind it. Customers include Rio Tinto and Barrick. The performance claims haven't been independently validated.
🏆 Crimson Education co-founder Jamie Beaton has taken out New Zealand's EY Entrepreneur of the Year. (EY)
Beaton co-founded Crimson in New Zealand in 2013 to help students with competitive university admissions and won the Tech and Emerging Industries category in September.
⚡ CSIRO spinout Hadean Energy has won a $15 million grant from the Australian Renewable Energy Agency to build a green hydrogen pilot plant that runs on factory waste heat. (Startup Daily, Business News Australia)
In plain English: green hydrogen is made by using electricity to split water into hydrogen and oxygen, and that electricity bill is what makes it expensive. Hadean's ceramic tubes split steam instead and use heat to do part of the work. Heavy industry like steelworks throws off plenty of spare heat, so a Hadean unit sitting on site needs about 30% less electricity. Its prototype used less than 36 kilowatt-hours per kilogram of hydrogen, against 50 to 55 for other electrolysers.
By selling those electrolysers to industrial sites that already use hydrogen and want a cheaper, cleaner on-site supply. The pilot at BOC's Western Port site in Victoria is sized to produce up to 7 kilograms an hour, about 85% of what a neighbouring steelworks needs.
Hadean was co-founded in 2023 by CSIRO and RFC Ambrian after about eight years of CSIRO research, and its prototype ran for 1,000 hours at BlueScope's Port Kembla steelworks. The grant covers half of the $30 million pilot, and Hadean expects to raise more over the next 12 months to build it.
🤑 Aussie Raisins 🤑
🎓 Coursebox, an AI platform for delivering skills training, has signed a term sheet with Purpose Ventures to lead its round with $1.5 million at a $12 million pre-money valuation.
It's raising a further $1.5 million alongside Purpose and is aiming to close by the end of November. Coursebox says it has reached $2 million in ARR, with more than 1,700 paying customers across more than 110 countries.
💰 M&A 💰
🔔 The IPO queue: Morse Micro is readying an ASX float by May, Swipejobs has pushed its listing into next year, and Anthropic's record IPO is open to Australian retail investors. (Capital Brief, Capital Brief, Capital Brief)
Morse Micro is a Sydney semiconductor company that designs Wi-Fi HaLow chips, a long-range, low-power version of Wi-Fi built for connected devices. Its latest accounts show commercial revenue of $1.9 million in FY25, up 7.8%, and a net loss of $45 million. It collected $16.5 million in R&D tax incentives and grants and holds $85.6 million in liquid assets after an $88.3 million round. A $500 million valuation has been mooted for the float, and the company calls the accounts a 'commercial inflection point'.
Swipejobs, the Texas-headquartered staffing platform founded by Australian Katrina Leslie and backed by James Packer and David Paradice, had been preparing for a November listing at a mooted $2 billion valuation. That has slipped into next year, with fund managers split on how much of an AI business it is. UBS, Bank of America and Barrenjoey are joint lead managers.
Anthropic's local offer runs through CommSec and other brokers and closes at 5 pm on Tuesday 17 November, ahead of its Nasdaq debut.
🔎 People Moves 🔍️
👋 Justin Joffe has finished up at Flux, the finance media and app startup he co-founded in 2019, which was acquired by ASX-listed Netwealth in October last year. (LinkedIn)
Joffe built Flux with Brett Joffe and Gustavo Hoirisch and co-hosted its What the Flux podcast, which has passed 1,400 episodes. He says Flux grew a community of hundreds of thousands of Australians and was the first local company to properly gamify finance. He hasn't said what's next, only that there's something coming soon. Watch this space 👀
📆 Notice Board 📆
🎟️ First release tickets for SOUTHSTART 2027 go on sale at 9 am ACDT on Tuesday 17 November. Register for early access here.
🍻 The Adelaide GTM Meetup is on from 5 pm to 7 pm ACDT on Thursday 19 November at The Stag Public House on Rundle Street.
It's a no-agenda catch-up for the non-technical people in tech, across go-to-market, marketing, sales, customer success, operations and partnerships. Register here.
🧠 KaaS (Knowledge as a Service)
It’s one from the archive, as it came out three years ago, but in light of GTA 6 coming out, I revisited this episode to break down Take-Two Interactive, the makers of GTA 5 and now 6. GTA 6 is expected to haul in between $3.25 billion and $5.2 billion USD in revenue during its first week, with unit sales estimated between 28 million and 51 million copies.
Have we missed something? Got some feedback? We love emails, so send one over!
👔 Connect with me on LinkedIn: Overnight Success, Will Richards
📈 Want to invest in great startups? Join Australia’s friendliest investment syndicate here, where small cheques are welcome!
Want better startup data? Check out our startup deals database, used by VCs, founders, and business development teams to stay on top of all high-signal data.
🚀 Want to get your product or offering in front of ~5,200 founders, investors and operators building scaling startups? Email us to learn more about our sponsorship and partnership opportunities.
❤ Getting a bunch of value from OS and want to support our growth? Consider becoming an OS Superhero.
‘Til next time,
👋 Will