Cuttable, a Melbourne-based ad technology startup, has raised US$4.5 million in a second seed funding round, bringing its total funding to US$10 million.

The company, founded by Sam Kroonenburg, Jack White, and Ed Ring, automates the creation of ads for platforms like Facebook and Instagram using AI.

The latest investment values Cuttable at US$44.5 million and was led by existing backer Square Peg, with Rampersand and Brand Fund also joining.

The startup launched less than a month ago after a year in development, during which its platform was tested by businesses including Kogan, Wesfarmers, Medibank, DiDi, and Powershop.

Cuttable said the new funding will support its global expansion and further development of its AI platform, with a focus on the US and additional ecommerce clients in Australia and overseas.

🔗 Source: Smart Company

🧠 Food for thought

1️⃣ AI advertising automation market surge justifies premium startup valuations

Cuttable’s $44.5 million valuation at the seed stage reflects the growth in AI advertising technology.

The global AI advertising market has already surpassed $184 billion and is projected to exceed $826 billion by 20301.

This represents a market expansion that makes premium valuations for proven AI advertising platforms more defensible to investors.

The AI marketing sector specifically is growing from $12.05 billion in 2020 to a projected $47.32 billion by 20252.

Companies demonstrating early traction in this space, like Cuttable’s generation of over 10,000 ads during testing, can command higher valuations due to the clear path to capturing market share in a growing sector.

The success stories are already evident, with 73% of companies reporting increased ROI after implementing AI marketing solutions3.

2️⃣ Australian startups increasingly follow enterprise-first validation approach

Cuttable’s strategy of testing with major enterprises like Kogan, Wesfarmers, and Medibank before official launch reflects a broader shift in Australian startup funding patterns.