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. 🚀

🎨 Canva has officially rebranded itself as an AI company, unveiling Canva AI 2.0 at a 6,000-person investor and customer conference in Los Angeles, announcing a platform shift that moves its products from software tools to a conversational AI interface, where agents handle design work autonomously. Check out the full hour keynote here. (AFR)

🏧 Two of Australia's most prominent payments scaleups are both pushing hard into global markets this week. 

🛡️ The Albanese government will boost defence spending by $53 billion over the next decade, with $14 billion front-loaded into the next four years under the new National Defence Strategy. (AFR)

💰 B2B fintech Pay.com.au has shelved its planned ASX listing, citing geopolitical uncertainty driven by conflict in the Middle East, instead closing a $20 million private placement at a $750 million valuation. (SmartCompany)

🤝 ASX-listed accelerator Scalare Partners (ASX: SCP) has partnered with investment infrastructure platform GXE to embed fund administration, SPV creation, and transaction processing directly into its Inhouse Ventures startup marketplace. 

📊 Australia's data centre industry exceeded 2 million tonnes of carbon emissions for the first time in 2024-25, driven by a 16% surge in emissions from facilities operated by Amazon, AirTrunk and CDC Data Centres. (Innovation Aus)

Founders: Oliver Shaw and Mark Hurley

Caruso, a funds administration and registry services platform, has raised $9.3 million in a funding round led by Icehouse Ventures and GD1, two of New Zealand's most active venture capital firms, alongside Sydney-based private credit firm Balmain. The round values the company at $80 million AUD. Jon Gelsey, former chief executive of AI chipmaker Xnor.ai and identity platform Auth0, also participated.

Running a fund means managing a sprawling set of operational tasks: accounting, investor onboarding, capital raising, and ongoing communications. Most managers stitch this together across legacy tools that weren't built for the job. Caruso is building a platform to consolidate that stack, targeting fund managers across real estate and alternative assets.

The platform handles end-to-end fund operations, including fund accounting, investor onboarding, capital raising, and tracking investor communications. Caruso describes its approach as AI-native, meaning automation and intelligence are baked into the architecture rather than layered onto legacy infrastructure. The company is currently developing expanded AI agent capabilities as part of its product roadmap.

Caruso was spun out of Jasper, a New Zealand commercial real estate investment house, in 2022. Assets under administration on the platform surged 10x over the past 12 months to $80 billion across 80 fund managers. That growth trajectory drove the company's valuation from $18 million AUD to $80 million AUD in 15 months. Customers include Centuria Capital Group (ASX-listed real estate and fund manager), IP Generation (MA Financial's commercial real estate investor), and Marshall Investments (John Marshall's family office).

Caruso will deploy capital toward product development and AI agent capabilities, grow headcount to 80, and relocate its headquarters from Auckland to Sydney.

The round adds to a backer list that includes Pushpay founder Chris Heaslip and the Rae family, the Western Australian family behind fuel retailer Gull Petroleum. Balmain, which led Caruso's $18 million bridge round 15 months ago, also re-invested.

Due Diligence: AFR, Startup Daily

Founders: Will Bodewes and Nisal Ranasinghe

Phonely, an AI voice agent platform co-founded by two former University of Melbourne researchers, has raised $US16 million ($22.4 million) in a Series A round at a $US100 million ($140 million) valuation. The round was led by San Francisco-based Base10 Partners, a firm focused on automation in the real economy, with participation from customers TSA, Etech Global Services, and Engage CX.

Co-founders Will Bodewes (CEO) and Nisal Ranasinghe built the original prototype as a side project during their studies in explainable machine learning. Bodewes, who is American, traces the idea to a practical problem: his father was struggling to find a reliable receptionist for his veterinary clinic. Three years later, the company's agents are handling millions of calls per month. Ranasinghe, who moved from Sri Lanka to Melbourne in 2021 to study, leads technology operations from Melbourne. Bodewes runs the business from San Francisco. 

Phonely's AI agents handle inbound and outbound customer service calls across a range of industries. The company's own testing puts its agents 15% ahead of human agents on appointment bookings, while operating at 80% lower cost. Phonely estimates 90% of callers don't realise they are speaking to an AI.

Clients include TSA, one of Australia's largest customer service outsourcing providers, whose own customer base includes Telstra and Air New Zealand. Bodewes also noted that callers are often more forthcoming about sensitive medical or financial matters with AI agents than with human ones. This is a dynamic the company sees as a product advantage, though the ethics of AI disclosure in voice interactions remain an active industry debate.

The Series A capital will go toward hiring senior software engineers and sales and marketing staff. The Series A follows a $US500,000 pre-seed round in May 2024 led by Y Combinator, and a seed round in October 2024 led by 7BC Venture Capital.

Due Diligence: AFR, Capital Brief, Startup Daily

Founder: Alain Richardt

Atomic Tessellator, a computational materials company that uses simulation-first computing to accelerate the discovery of advanced materials, has closed an $11.3 million seed round. The round was led by Crane Venture Partners, investing from its new US$135 million APAC fund, marking the European firm's first deployment into the Asia-Pacific region. New investors In-Q-Tel (IQT), Icehouse Ventures, Outset Ventures, and GD1 joined alongside existing backers Salus Ventures, Side Stage Ventures, and Confluent.

Rare earth elements sit at the core of modern defence and aerospace hardware, from fighter aircraft and high-temperature motors to robotic actuators and advanced optical systems. Unlike most commodity inputs, they cannot simply be sourced from an alternative supplier when geopolitical conditions shift. The Global Critical Minerals Outlook 2025 identifies China as the leading refiner for 19 out of 20 strategic minerals, with an average market share of 70%.

While most computational materials research focuses on theoretical structure discovery, Atomic Tessellator has built an end-to-end platform that combines proprietary structure generation with a comprehensive evaluation pipeline. The platform tests candidate materials across mechanical, thermal, magnetic, and radiation-resistance properties — including at the limits of physical performance — before any physical synthesis takes place.

The result is a dramatic compression of traditional timelines. Discovery work that would typically span three to four years in a laboratory now takes weeks. Processes previously estimated to cost $200,000 in lab time can be run for under $100 in compute tokens.

Alongside the raise, Atomic Tessellator announced the successful synthesis of Vireon, its first rare-earth-free magnet. The material was simulation-discovered and lab-verified, and the company says it outperforms existing rare earth alternatives on key performance metrics.

Vireon is now entering commercialisation. Behind it sits a pipeline of 20 novel material candidates in development, which include high-temperature alloys, radiation-resistant materials, and compounds with specialised optical properties. Ten are actively undergoing lab synthesis.

The company will use the capital to establish a research laboratory and scale-up facilities capable of producing materials at volume, with vertical integration now targeted for this year. Atomic Tessellator is headquartered in New Zealand with a growing Australian presence. The company has established research partnerships with the University of New South Wales and the University of Sydney.

Due Diligence: AFR

Founders: Petros Christodoulou, Robin Jack and Paul Evangelou

Social media platforms have spent a decade perfecting the science of engagement: personalisation, instant feedback, social reward loops, and variable reinforcement. Gizmo thinks the same mechanics can be applied to something more useful.

Gizmo, an AI-powered study platform founded in 2021 by three University of Cambridge graduates, has raised $US22 million in a Series A round led by Shine Capital, with participation from Ada Ventures, Seek Investments, GSV, and NFX. NFX previously led Gizmo's $US3.5 million seed round. The London-headquartered company now serves more than 13 million learners across 120-plus countries.

Students upload notes, documents, or web links, and Gizmo's AI generates personalised study materials, interactive flashcards, adaptive quizzes, and gamified challenges in seconds. Built-in social features let users study alongside friends, compete on leaderboards, and track progress together. The platform targets students preparing for high-stakes exams, from UK secondary school students sitting GCSEs to US university students and professionals upskilling in competitive markets.

Petros Christodoulou co-founded the company with Robin Jack (CTO) and Paul Evangelou (CPO), both fellow Cambridge graduates. The three bring backgrounds across education, computer science, and AI engineering.

The Series A capital will go toward expanding Gizmo's engineering and AI team, growing in the US college market, and deepening engagement across its existing global user base.

Due Diligence: TechCrunch

Founders: Pia Clinton-Tarestad and Dr Chris Davis

Around 1.4 million Australians meet the clinical threshold for alcohol dependence. On average, it takes 18 years before someone with alcohol dependence speaks to a health professional. When they do, the system they find is often fragmented, stigmatising, and rarely available at the moment they are ready to change. 

Clean Slate Clinic, a virtual doctor-led alcohol detox and recovery platform, has closed a $4.3 million capital raise comprising a $2.8 million convertible note and a $1.5 million debt facility. The convertible note marks the entry of impact fund Giant Leap onto the cap table, alongside a renewed commitment from Scale Investors, investing through their latest fund. The debt facility was established through the existing backer, Australian Medical Angels.

Founded in 2020 by Dr Chris Davis, a GP and addiction medicine specialist, and Clinton-Tarestad, Clean Slate provides medicated at-home withdrawal and recovery support for people with alcohol, stimulant, or cannabis dependence. Patients access clinician-led care remotely, removing the need for hospitalisation or in-person treatment, which many people delay seeking due to stigma or access barriers.

The company has supported more than 3,000 patients and recorded 8x revenue growth across nine quarters. Its relapse rate is more than three times lower than the industry standard, and it holds a 94% client experience score. Clean Slate has also secured reimbursement coverage across the majority of Australia's private health insurers.

Clean Slate is now raising a $10 million AUD Series A to accelerate expansion into the UK and prepare for additional markets in 2027. The company was recently named Impact Enterprise of the Year.

Due Diligence: Startup Daily, Capital Brief

Founders: Bronte Campbell OAM, Libby Babet, Chris Raleigh

Earthletica, a Sydney-based sustainable activewear brand co-founded by triple Olympic gold medallist Bronte Campbell OAM, fitness entrepreneur Libby Babet, and Chris Raleigh, has raised $1.13 million AUD from 429 investors via Birchal's equity crowdfunding platform. 

Founded in 2020, Earthletica designs premium women's activewear using recycled and organic materials across its full supply chain. The company holds B Corp certification and has spent two years developing what it describes as a scalable supply chain that doesn't require customers to sacrifice comfort or performance.

The brand has reached $200,000 in revenue, a 50% repeat purchase rate, and a customer base built almost entirely through organic and social channels. Earthletica has 3,500 email subscribers and a combined 125,000 social media followers across its co-founders and brand accounts.

The raise will go toward marketing expansion, product development, and growing distribution partnerships. Near-term priorities include deepening its direct-to-consumer presence in Australia and creating in-person customer experiences. An outerwear line is also in the works for later this year.

The company's three-year target is $6 million AUD in annual revenue and a global footprint.

Due Diligence: SmartCompany

🧲 DryFlow Magnetics (Adelaide, founded 2024) is reopening its Seed round on the same terms as its $10 million AUD Seed raise from December 2024, to fund fabrication of its processing plants. (Startup Daily)

🌊 Uluu, the Perth-based biotech, co-founded by Michael Kingsbury and Dr Julia Reisser, has secured $2.1 million in federal grant funding through the Australian Government's Industry Growth Program. (SmartCompany)

🏗 Taronga Group is now accepting applications for Asset Impact 2026, its growth-stage accelerator connecting tech companies with global real estate and infrastructure asset owners.

🕵 Confidential Capital is hosting a GovTech and DeepTech founder pitch event in Canberra on 29 April 2026, at the Canberra Innovation Network.

🧑‍🎓 Plus Eight Sprint, a free, six-week pre-accelerator run by Spacecubed, is now open for applications, exclusively for founders and small business owners operating in Western Sydney's 13 local government areas.

🌱 ThincLab and the Adelaide Economic Development Agency (AEDA) are running the ThincSeed Pre-Accelerator. A seven-week program for early-stage founders who have moved past the idea stage and want to pressure-test and validate their venture.

🏛️ The NSW Government has launched the Emerging Technology Commercialisation Fund (ETCF): a competitive grants program offering grants of between $500,000 and $2 million (up to $7 million per round) to help NSW startups move world-class research toward commercial deployment.

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Will’s Pick  Okay, I’ve had a big week of content, so here are a few things I’ve really enjoyed and a few words on why.

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👋 Will