Aussie startup Elenium Automation has raised $30 million in Series B funding, after making a swift COVID-19 pivot away from a stalled aviation industry.
The round is led by motor services giant NRMA, which has contributed a $10 million cash booster.
Founded in 2015 by a team of former Jetstar employees, Elenium set out to modernise the airport experience, taking passengers seamlessly from bag-drop to boarding.
This round follows a $15 million Series A, announced in April last year.
At that time, Elenium was gearing up to take its airport automation tech global. Of course, 18 months on, the aviation industry looks a little different.
Still, in February 2020, things were looking good for the business.
While co-founder and chief Aaron Hornlimann doesn’t disclose what kind of revenues it was bringing in, he says Elenium was “finally cashflow breakeven”.
The startup had signed some sizable tenders, had grown to a team of 80 people, and was beginning to make a name for itself in the airline industry, he adds.
“We were getting out of that real startup phase and starting to really kick some goals.”
In fact, this funding round was originally planned for February of March this year. But, the startup had enough capital left under its belt to take a step back and wait to see how the pandemic affected the aviation industry, and to think about creating an alternative roadmap.
As it turns out, that was probably a wise decision.
“I don’t think we imagined it would be as broad as it was and as devastating as it would end up being,” he says.
A change of course
Elenium did, however, have some tricks up its sleeve. Throughout 2019, the team had been working on some new technologies.
First, it was looking into a robust voice-recognition tool, designed to be reliable in a busy environment like an airport.
And, the team was working on virtual touchless screen technology that could allow a person to control a screen just by looking at the area they want to select.
“We had this view that self-service had to be democratised,” Hornlimann says.
“Having touchless self-service would really help push that forward.”
Elsewhere, Hornlimann and his team were looking into ways they could detect a person’s heart rate, respiratory rate and temperature, the founder says.
That was driven by feedback from airline partners, who said one of the main reasons for delays was passengers being taken ill at the boarding gate.
By late-2019, the startup was in the early stages of working on this technology.
Once COVID-19 came into the picture, “we brought the development of that forward pretty quickly”, Hornlimann says.
All of this means that, when the true extent of the crisis started to become apparent, Elenium was ready. Even though the tech was still airport-centric, the business was already working on capabilities Hornlimann knew would be transferable.
In April this year, Elenium announced the new products.
“We had more sales enquiries in those two weeks than we had in the previous two years,” Hornlimann says.
“And the vast majority was outside of aviation.”
Now, the startup is working with healthcare networks, aged care facilities, military facilities and even cinemas, he adds.
The capital raise was always going to be about growth, “not necessarily about keeping the lights on”, Hornlimann notes.
“We were able to slow down, readjust ourselves … now we’ve got this ability to grow not just inside aviation but outside.”
Hornlimann says this $30 million will partly go towards helping Elenium adjust to a new sector. In the aviation space, a sale can take nine to 12 months, he says.
Now, the team is making sales within less than a month.
“Rather than making everything to order, we now build and maintain stock so we can deliver quickly,” he explains.
The business is also starting to work with resellers that specialise in these new verticals.
With the vital signs detection tools, the team is also going through regulatory approvals in various different countries.
“There’s been a fair bit of change in the business requirement and the organisation itself to be able to respond to this new-found demand,” Hornlimann says.
But, these are not temporary changes, he adds.
Of course, these were developments Elenium was working on for an airport context anyway. Post-pandemic, he thinks they will become all the more important.
“People will be sensitive to bad flu seasons,” he explains.
“People will be more aware of the cost of people being sick, and the economic impact that can have.”