Melius, a New York-based AI platform that creates ad campaigns, images, and videos, has raised $25 million in total funding. The company announced the news on Tuesday.
The total includes a $20 million Series A round led by CRV. It also includes a $5 million seed round led by General Catalyst.
The startup says it reached more than $1 million in annualized revenue within two months of coming out of stealth in July.
Founders Scrapped Their First Product
Melius was founded by Joowon Kim, Young Kim, and Arnav Ramu. The three met while working as engineers at Ramp, the corporate spending and finance software company.
When the company first launched more than a year ago, the team set out to build an AI tool for performance marketing. The goal was to help marketers manage and improve their ad spending.
After more than six months of work, the founders decided the idea did not "have legs," Joowon Kim told TechCrunch.
"We scrapped the entire codebase; we burned all of it," Kim said.
The team then shifted its focus to building tools that create the ads and campaigns themselves. The founders saw this as a much larger opportunity.
Nearly a year after its first launch, Melius revealed its new platform. The company describes it as an "agents lab for creative work."
Competition in AI Ad Creation
Melius is one of several startups using AI to help ad agencies, marketers, and brands produce creative work. Rivals include Higgsfield, along with smaller startups such as Krea and Flora AI.
Higgsfield was valued at $5.4 billion in August. The three-year-old company has passed $700 million in annualized revenue.
Kim said Higgsfield "is growing like mad." Still, he said the market is large enough to support several companies.
"There are a lot of players, which is pretty exciting," he told TechCrunch. "That means there are customers to be won and there is demand in this space."
Kim, who calls himself a social media influencer, said his interest in video started early. He has made short videos since elementary school and once hoped to become a famous YouTuber.
"I tried my best to make vlogs," he said. "My dad was great at using FinalCut Pro, but I wasn't."
His early vlogs did not take off. But his interest in digital media stayed with him.
With Melius, Kim says he is building the tool he always wanted. The platform lets anyone, including experienced creative directors, turn ideas into finished content using plain language.
The $25 million raise, announced Tuesday, comes about three months after Melius came out of stealth in July.
