SafetyCulture has booked a $165 million funding round, marking one of the year’s largest single investments in an Australian scale-up and the biggest single initial investment in VC firm Airtree’s history.
The round, comprised of $75 million in new capital and $90 million in secondary share sales, values SafetyCulture at $2.5 billion.
That is down from the $2.7 billion valuation it secured last year, but founder Luke Anear calls the latest result a success in a “tough environment” for fundraising.
Speaking to SmartCompany, Anear says the investment showed faith in SafetyCulture’s transition from a workplace safety and compliance toolkit to a fully-featured operations platform.
Previously, between 3-5% of a company used tools provided by SafetyCulture, he says.
Its development and expansion has put more tools in the hands of employees, including those working on the production line, in the warehouse, and around the arena, expanding its addressable market.
With its investment, Airtree recognises “the opportunity in front of us, that we’re now solving a much broader problem than we were 12 months ago,” says Anear.
Repeat investors Blackbird and Morpheus Ventures also participated in the round, which featured contributions from Hostplus and HESTA.
The round also provided a liquidity event for early-stage investors, who may have eyed an IPO as an opportunity to make good on SafetyCulture’s success.
“An IPO is not a career goal for us but it may be a function of the business,” Anear says.
“If you can’t get capital from the private market and if we needed more capital, then you could certainly look to the public markets as an option for that.”
However, “we don’t have any aspirations to IPO anytime soon,” Anear continues, suggesting it’s an option SafetyCulture will consider further in the coming years.
The Townsville-born safety, compliance, and operations platform says much of the fresh funding will help it develop solutions for major multinational enterprises, which are increasingly turning to SafetyCulture’s product suite.
It will also consider how to expand the use of artificial intelligence in an attempt to furnish frontline workers with the same kinds of insights AI can provide to managerial teams.
Its tools could help supermarket chains automatically identify fresh produce nearing its use-by date, allowing faster replenishment of stock, Anear suggests.
SafetyCulture has collected more than five petabytes of workplace data and imagery, giving SafetyCulture the opportunity to generate productivity plans for the businesses it services.
“Long term, what we want to be able to do is identify what great looks like, industry by industry, and then help provide prescriptive workflows on how customers can improve their businesses,” Anear says.
“We started out as a safety company, but today, only 25% of our business is safety, 75% is quality and improvement.”
AI models may be able to help “identify the 1% improvement that each team can make, based on the type of industry they’re in, their location, the size of their team, their customers, all those sorts of things”.
The scaleup is also hiring its first chief AI officer, in an attempt to embed realistic AI-driven improvements in the product suite.
Investment activity in 2024 has declined from the heady peaks of 2020 and 2021, but Kell Reilly, partner at Airtree Ventures, said it was the right time to back one of Australia’s most significant tech exports.
“SafetyCulture has all the hallmarks of Silicon Valley’s tech heavyweights – a compelling vision, product, scale and team,” Reilly said in a statement.
“We’re excited to partner with another Aussie success story that’s making waves on the global stage.”
Australian firms to have secured $100 million-plus investment rounds in the 2024 calendar year include former Smart50 award winner Cover Genius, clean tech startup Hysata, and innovative recycler Samsara Eco.
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Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
