“We genuinely could not have existed without generative AI,” says James Donald, co-founder of Ideally, a customer-research platform.
His Auckland-based start-up has also taken advantage of a low-tech, old-school edge (which we’ll get to shortly) as it’s signed up a roster of blue-chip clients.
And it’s just revealed an A$5.5million ($6m) “seed extension” round, led by New Zealand’s Icehouse Ventures and Australia’s OIF Ventures (last seen on this side of the Tasman backing Datamasque).
It follows an earlier $2.2m seed raise, also led by Icehouse.
Ideally makes software that allows creatives to taste brand or marketing ideas with rapid-fire customer surveys.
Donald says it’s aimed at companies large enough to have in-house creative and research teams. His pitch is that surveys that would normally take weeks can now be done overnight, and for $10,000 rather than $50,000.
Ideally is something of a sibling to another hot market research start-up, Tracksuit.
The two share a common backer – well-established Australasian market research and analytics firm TRA (The Research Agency). Brand-focused venture capital firm Previously Unavailable also backs both firms through its Brand Fund 1 (a joint venture with Icehouse).
But they cater to different ends of the creative process: Ideally is for the brainstorming and development phases, while Tracksuit measures a campaign’s success.
From left: Ideally co-founders Joshua Nu’u-Steele, James Donald and Brendan Cervin.
Donald bills it as a “self-service platform” that lets creatives run DIY surveys without tapping a research team. In short, it’s about AI giving the creatives more powers rather than snatching their jobs.
Ideally uses an external third party to survey hundreds of people, and tools from OpenAI to help automate the process of creating a test, framing it, sending it, then pulling in and making sense of the results.
The old-school edge came from TRA, the single largest shareholder with its 42% stake, according to a September 17 Companies Office update.
TRA’s networks and cachet helped get a foot in the door, then sign, around eight foundation customers – who served as a proving ground for selling to others outside the fold.
Since it launched in September last year it’s gained 115 customers across Australia and New Zealand, including ANZ, Asahi, Telstra, Bupa, Revlon, Hanes, Lion, Kraft Heinz, Afterpay, Nine, and Goodman Fielder.
The platform is also used by 25 of the top creative and advertising agencies in Australia, including DDB, VML, M&C Saatchi, Ogilvy, CHEP, Special Australia and Thinkerbell, Donald says.
US push
Today, Ideally has 30 staff – 20 in Auckland and most of the balance across the Tasman.
The new seed money will be used, in part, to hire a further 15 employees, with an eye on sales lead growth, and a push into the United States.
Donald says Ideally will pursue “focused expansion” in North America rather than a willy-nilly effort. Once it’s found its feet, it will stage a Series A round “to really fuel growth in the US”.
Rapid-clip revenue growth
Donald won’t give a post-money valuation or comment on financials, but one of Ideally’s backers provides the general flavour.
“Of the 150-plus software companies we have funded, the average time to $1m revenue is approximately four years, and $5m revenue takes close to six years,” says Icehouse Ventures chief executive Robbie Paul.
“Ideally got to the first mark [$1m] in half the time and is on track to hit the $5m mark equally rapidly.
“What is especially encouraging is the diverse set of businesses that make up Ideally’s revenue. They are clearly addressing a pain that is common across many industries, models, and geographies.”
Co-founder and chief technology officer Brendan Cervin has been with a string of startups including Archipro, Whip Around and Yabble.
He was also one of the co-founders of GeoOp, but got the seven-year itch and left in 2016 (the maker of software for tradies delisted from the NZX earlier this year and was tipped into receivership last week).
The third co-founder, chief revenue officer Joshua Nu’u-Steele, most recently had a four-year stint as global sales manager for Parkable.
For his part, Donald spent 12 years in the energy industry – he was a well and reservoir management lead at Shell and later responsible for the long-term development of the Maui gas field – before pivoting to software in 2018.
It was partly a desire for a change of scene, and partly because he had growing qualms about environmental issues.
His first two stabs at a software startup had mixed results. Leap Booking – which aimed to connect travellers with outdoor equipment – was wound down after 14 months. Lessons were learned.
Then came Yonder HQ, “a customer service and marketing tool for tourism activity and accommodation providers” which included an AI chatbot. Donald says it was sold to a US firm for a “modest” amount. “There’s no new Porsche in my driveway.”
The way things are tracking at Ideally, he might soon be able to upgrade his wheels.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
