Melius scrapped its first AI product and raised $25 million for ad creation
Melius
An AI platform for making ad campaigns, images, and videos.
annualized revenue
A one-year estimate based on current sales speed.
Series A
A funding round for a young company’s growth.
What happened
Melius, an AI platform for making ad campaigns, images, and videos, announced $25 million in total funding. TechCrunch reported that the package includes a $20 million Series A led by CRV, an investor in young companies, and a $5 million seed round led by General Catalyst, another startup investor. Melius was founded by Joowon Kim, Young Kim, and Arnav Ramu. All three previously worked as engineers at Ramp, a software company for managing business spending and finance. TechCrunch report
Melius says it passed $1 million in annualized revenue within two months of leaving stealth in July. Annualized revenue is a run-rate estimate. It applies the current pace to a full year. It does not prove that Melius already collected $1 million during one year.
The reset behind the funding
Melius first built an AI performance-marketing tool. It was meant to help marketers manage and optimize ad spending. After more than six months of work, co-founder Joowon Kim said the idea did not have enough promise. The team scrapped the entire codebase. It then rebuilt around a different task: generating the creative assets and campaigns themselves.
Nearly a year after the initial launch, Melius introduced the new platform. The company describes it as an agents lab for creative work. In practical terms, users can describe an idea in everyday language. The system then helps produce ad images, videos, and campaign concepts.
Why this matters
The important story is the product change, not just the check size. Melius moved from managing ad budgets to making the ads. That move shows how an early startup can change its target problem after testing an initial idea. It is still only one example, not proof that every pivot works.
The market is crowded. Competitors named in the report include Higgsfield, Krea, and Flora AI. Kim says the market is large enough for several companies. That is a founder's view, not an independent market measurement. Investor confidence also does not prove customer success. The real test is whether users keep paying for the new product.
What is confirmed
The reported facts are the funding breakdown, the founders' former Ramp jobs, the product pivot, and Melius's own revenue claim. The codebase reset also comes from Kim's account. The report does not provide independent customer numbers, profit figures, or product-performance tests.
What remains unclear
We do not know how many customers produced the reported revenue pace. It could reflect short contracts or a small number of large customers. We also do not know whether Melius is profitable, how it will use the funding, or whether its generated ads improve real campaigns.
The founders' judgment that the first product lacked promise also has no published benchmark in this report. The same is true of the new product's advantage over competitors. A fast launch and a large round leave those questions open.
What to watch next
The next useful signals are customer growth, repeat use, and revenue after the funding. It will also matter whether plain-language instructions save creative teams time and money. Melius's second product must turn early interest into a durable business. That is the bigger test behind the headline.
Melius starts over with AI tools for making ads
📰 Full story: Melius scrapped its first AI product and raised $25 million for ad creation
Melius changed direction after scrapping its first product and announced $25 million in funding.
Melius
An AI company that makes advertising tools.
codebase
The main software behind a product.
annualized revenue
A yearly estimate based on current sales speed.
💡 The gist
- Melius abandoned its first product.
- It now makes AI tools for creating ads.
- Investors announced $25 million in total funding.
Melius is an AI company that makes ad images, videos, and campaigns. Three former Ramp engineers founded it. Ramp makes software for managing business spending.
Melius first built a tool for managing ad budgets. The team worked on it for more than six months. Then the founders decided the idea was not promising enough. They threw away the entire codebase. A codebase is the main software behind a product. Then they built a different product.
The new platform creates ad images, videos, and campaign ideas. People can describe what they want in everyday language. Melius calls it an agents lab for creative work. An agent is an AI system that carries out tasks.
The pivot also changed what Melius sells. The first tool helped decide where ad money should go. The new tool helps create what audiences see. Those are different jobs. The company now competes in a busy creative market.
Melius left stealth in July. Stealth means building privately before a public launch. Two months later, Melius said its annualized revenue passed $1 million. Annualized revenue is a yearly estimate based on current sales speed. It does not mean Melius already earned $1 million in one year.
The funding totals $25 million. A Series A round provided $20 million. CRV, an investor in young companies, led that round. A seed round provided $5 million. General Catalyst, another startup investor, led it. Twenty million plus five million equals $25 million.
Other companies also make AI advertising tools. They include Higgsfield, Krea, and Flora AI. Funding alone does not prove that the product will win.
Important details remain unknown. We do not know customer numbers, profits, or repeat use. We also do not know how Melius calculated its revenue estimate. The report does not show how the ads perform in real campaigns.
Next, watch customer growth and revenue after funding. Watch whether simple instructions save creative teams time. Melius needs to turn its second try into a lasting business.
Source: TechCrunch
Melius threw away its old tool and made a new one
📰 Full story: Melius scrapped its first AI product and raised $25 million for ad creation
It changed its tool and got money to build the new one.
Melius
A company that makes ad pictures and videos.
AI
A computer helper that follows people's words.
CRV
A company that gives money to young companies.
Melius is a company that makes ad pictures and videos with AI. AI is a computer helper that follows people's words.
The founders once worked at Ramp. Ramp makes tools for business money.
First, Melius made a tool for planning ad money. They worked on it longer than six months. Then they decided it was not working well. They threw away the software inside it. Then they made a new tool.
The new tool makes ad pictures, videos, and plans. People tell it what they want. The computer turns those words into ideas.
Melius showed the new tool in July. Two months later, it talked about its sales. It said its current speed could pass $1 million in one year. That does not mean it already got $1 million. It means the same speed might continue.
CRV is a company that gives money to young companies. It gave Melius $20 million. General Catalyst is another company that gives money to young companies. It gave Melius $5 million. Twenty million plus five million equals $25 million.
Melius now has money to build its new tool. But we do not know if many people will keep using it. We will watch what happens next.
Source: TechCrunch