Sydney venture firm raises $3.5m to build ‘soulful’ AI start-ups

In a departure from the often-impersonal ethos of Silicon Valley, Nakatomi’s founders, Ben Bray and Andy Timms, emphasise a human-centric approach to innovation.

“We’re not in the business of optimising everything to the point where people are out of jobs,” Mr Bray said.

Nakatomi – named after the fictional Nakatomi Corporation from the movie Die Hard – is a different kind of venture capital outfit. It doesn’t just tip money into start-ups, it becomes co-founders with entrepreneurs to unearth the next big thing in Australian innovation.

It has just raised $3.5m, securing backing from the founders of Australia’s homegrown AI model Leonardo.ai, Gannet Capital, Scalare Partners, Booking.com, and private equity veteran Les Fallick.

The goal? To cultivate a new generation of “soulful” start-ups and redefine how we use AI.

“While I agree with the sentiment that there might be a billion-dollar company run by one, I still think we’re very social humans … so doing it (founding companies) together,” Mr Timms said.

“But, the core statement of that, a lot will be done for you, starts honing down on, ‘well, what is that one person? What are they good at? Like, what is that good thing?’

“They’re probably a hyper empathetic person that understands a lot about one particular industry, which I think is interesting. So if you’re an entrepreneur who is that in Australia or New Zealand, then that’s a very exciting opportunity’

Its philosophy is centred on creating businesses that elevate human experiences, rather than merely chasing efficiency.

And Mr Bray and Mr Timms are thinking big when it comes to AI, with their vision extending “beyond the chatbot”.

Mr Bray criticised current AI applications, saying: “It seems to me that all new products, or all old products that have now got AI on them are the same product with a conversational chat layer thrown on top. That is not the best use of AI.”

Nakatomi is actively developing new interfaces and applications for AI that move beyond conversational models, with Mr Bray hinting at a forthcoming “calling card” product that could set a new benchmark for best practice in AI user interface.

This echoes Steve Jobs’s former right hand man and “spiritual partner” Jony Ive who left Apple in 2019 to launch his own design firm and has since partnered with Altman at OpenAI to develop a new device for the AI era.

Ive says the device will be unlike the iPhone he built at Apple, but a compact, intelligent companion designed to be aware of a user’s surroundings and lifestyle. He is yet to reveal what form it will take.

“I think Jony’s on the right track. It’s likely to be very passive and very personal,” Mr Timms says.

“But I don’t think, in terms of the display UI, as visual creatures, is going to go anywhere anytime soon. The insight of how it responds to you will change.”

Nakatomi’s model focuses on partnering with founders and corporates at the earliest stages, providing hands-on expertise across strategy, creative, technology, product, and growth.

“Our dream is that first couple of years of a company where you build it, form it, generate some revenue, and then help people scale.“ This deep involvement distinguishes Nakatomi from traditional venture capital firms, which typically invest in more established companies.

Nakatomi has already seen success with ventures such as Ovum AI, Australia’s first women’s health AI partner, which raised $1.7m. Mr Timms recounted the early days of their partnership with Ovum’s founder, Ariella Heffernan-Marks, a doctor who wanted to end gaslighting towards women in the health care sector.

“We literally met her when, you know, she was in scrubs … we certainly saw something in her and what she was going to achieve.” This anecdote highlights Nakatomi’s commitment to nurturing bold ideas from their nascent stages.

The founders also addressed the unique challenges and opportunities for entrepreneurs in Australia and New Zealand.

Mr Bray stressed the need for “new, better pathways for early ideas to get off the ground”, noting the difficulty of securing early-stage funding in the region.

Mr Timms added, “Australia and New Zealand are obviously amazing places to live … a lot of that will get imported here, but it’s just an attitude of build and make, and why can’t we do it?”

They believe the democratisation of tools and a strong local “can-do” attitude position the region to compete on a global scale, provided the right support structures are in place.

With the new $3.5m funding, Nakatomi aims to launch three to four new ventures annually, fostering a diverse portfolio that spans various industries, from agricultural technology with Ruminati to women’s health with Ovum AI.

The company’s continued focus on elevating human experience through thoughtful product design and innovative AI applications aims to position it as a significant player in the evolving global start-up ecosystem.

This article first appeared in The Australian as Nakatomi lands $3.5m to redefine AI innovation in Australia