Melius raises $25M ($20M Series A) after scrapping first product
Melius, a New York-based AI platform for generating ad campaigns, images and videos, announced on Tuesday that it raised a total of $25 million. The money comes in two pieces: a $20 million Series A led by CRV and a $5 million seed round led by General Catalyst.
The company says it passed $1 million in annualized revenue within two months of coming out of stealth in July. That figure is the startup's own claim. Co-founder Joowon Kim admits, though, that Melius did not hit it out of the park at first.
When the company first launched over a year ago, Kim and his co-founders, Young Kim and Arnav Ramu, set out to build an AI-powered performance marketing tool. The three knew each other from working as engineers at Ramp, the corporate spending and finance software company. More than six months after building the product, they decided their original idea did not "have legs," Joowon Kim told TechCrunch.
Instead of helping marketers manage and optimize ad spend, the team chose to chase what it saw as a much larger opportunity: building the tools that generate the creative assets and campaigns themselves. "We scrapped the entire codebase; we burned all of it," Kim said. Melius quickly started on an entirely new product, and nearly a year after its initial launch it revealed a platform that it describes as an "agents lab for creative work."
Melius is far from alone in helping ad agencies, marketers and brands generate creative assets and campaigns with AI. Competitors include the rapidly growing Higgsfield, which was valued at $5.4 billion in August, along with smaller startups such as Krea and Flora AI. Higgsfield is a three-year-old company that has hit over $700 million in annualized revenue. Kim acknowledged that it "is growing like mad," but he is not worried: according to him, the market is large enough to support multiple competitors. "There are a lot of players, which is pretty exciting," he said. "That means there are customers to be won and there is demand in this space."
Kim, who describes himself as a social media influencer, also explained why former Ramp engineers are building an ad-generation product. He says he has been passionate about making short videos since elementary school and once dreamed of becoming a famous YouTuber. "I tried my best to make vlogs," he said, adding that his dad was good with FinalCut Pro and he was not. The early vlogs never took off, but his interest in digital media stayed. With Melius he is building the tool he always wanted: a platform where anyone, including seasoned creative directors, can turn ideas into reality using plain language.
Key facts
- Melius raised $25 million in total: a $20 million Series A led by CRV and a $5 million seed round led by General Catalyst.
- The company claims more than $1 million in annualized revenue within two months of coming out of stealth in July.
- The three co-founders, all former Ramp engineers, scrapped their first product (an AI performance marketing tool) after more than six months and rebuilt from scratch.
- The new platform, described by Melius as an "agents lab for creative work", generates ad campaigns, images and videos from plain-language prompts.
- Competitors include Higgsfield (valued at $5.4 billion in August, over $700 million in annualized revenue), Krea and Flora AI.
Why it matters
The story is a pivot that paid off early, at least by the company's own account. Melius built a marketing-optimization tool, concluded after more than six months that it lacked legs, and threw away the whole codebase for a bigger target: tools that generate the creative assets and campaigns themselves. The market it entered already has a large player. Higgsfield was valued at $5.4 billion in August and has hit over $700 million in annualized revenue, so investor appetite for AI ad-creative tools is visible in both rounds.
Who it affects
Ad agencies, marketers and brands are the customers the source names for AI-generated creative assets and campaigns. Melius says its platform is meant for anyone, including seasoned creative directors, who wants to turn ideas into finished work using plain language. Rival startups such as Higgsfield, Krea and Flora AI share the same field.
How to use it
Melius describes its product as an agents lab for creative work, where users describe what they want in plain language and the platform generates ad campaigns, images and videos. No pricing, customer names, headcount or user numbers for Melius are given in the source, so there is nothing yet on how to sign up or what it costs.
How solid is it
The funding is stated as announced by the company: $25 million in total, split into a $20 million Series A led by CRV and a $5 million seed round led by General Catalyst. The $1 million annualized revenue figure is the startup's own claim and is not independently verified in the source. The quotes come from Joowon Kim's interview with TechCrunch. No valuation of Melius is given.
Risks and caveats
Kim admits the first product did not succeed, and the current one is under a year old. The field is crowded, and the best-known rival is far ahead on revenue: over $700 million annualized at Higgsfield against Melius's claimed $1 million. Kim's answer is that the market is large enough for many players, but that is his view, not a measured result. The headline $20 million is only the Series A; the $25 million total includes the $5 million seed. The source does not say when the seed round closed and gives no technical details of the new platform's models or agents.
“We scrapped the entire codebase; we burned all of it”
— Joowon Kim, co-founder of Melius