Ex-Tesla team raises $12.5M to put supply chains on autopilot; plus, EliseAI raises $350M, doubles valuation to $4B

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1:13That's Framer.com slash tcstartups. Rules and restrictions may apply. Supply chain startup Atomic came out of stealth last year with founders who promised to use their experience at Tesla to streamline inventory and boost customers' bottom lines. At its core, Atomic decides how much inventory a company should have and where by simulating scenarios, then recommending or even automatically choosing a response. The approach traces back to a crisis. Atomic's founders built an early version of this system during the 2018 Model 3 production ramp at Tesla, when the automakers' own spreadsheets could not keep up with how quickly planning needed to change.

1:57In the year plus since Atomic co-founders Michael Rossiter and Neil Sweetan started talking publicly about their work, that shift has become real for customers, including big tech companies like DoorDash and HelloFresh. It has paid off financially as well. Atomic's annual recurring revenue has quintupled since the beginning of this year, according to John McNeil, a former Tesla president and the founder of DVX Ventures, where Atomic was incubated. That growth just helped Boston-based Atomic lock down a$12.5 million Series A funding round, bringing its total funding to just north of$15 million to date.

2:39The new round was led by growth equity firm Class Capital and Seattle VC stalwart Madrona Venture Group. Atomic has also brought on longtime Tesla planning director Jeff Goodrich as its CTO and third co-founder. Rossiter, who is Atomic's CEO, said in an exclusive interview with TechCrunch, if you think about running a supply chain, running an operating model, it's like an infinite search space for optimization that you're trying to figure out all the decisions you could make at any given time. And then it changes all the time as well. AI can play the role of finding all of the best paths through that forest.

3:17The company has transitioned from pilot customers into real customers. and by real customers, it's DoorDash-scaled customers. McNeil, who's also on Atomic's board, said in an interview, the product has evolved from beginning an optimization platform that gives recommendations to a platform that not only gives recommendations but makes decisions. So it's fully autonomous in that sense, and DoorDash is running, I think, 90 % of its purchasing across hundreds of sites. For food-focused customers like DoorDash, Atomic's software helps cut down on waste and spoilage, and each new industry Atomic works in presents different challenges.

3:59Rossiter said, you know, the cool thing about Atomic is it's a general model of how you think about supply chains and operating models, and so no matter what that system looks like, our AI can adapt to it and tailor fit it. We're working with CBG, or consumer packaged goods, and we're going deep with mobility and manufacturing clients right now as well, and working that space, kind of going back to our Tesla roots. Making the agentic software useful and adaptable for multiple industries was a big part of what drew investor interest for a Series A, but it was also Atomic's ability to deploy quickly with new customers.

4:38McNeil said, we gave them this challenge from a board level of compressing their onboarding time and really making it a non-event for a customer to turn this on. Sweetan, who is also Atomic's chief product officer, ran point on that challenge. He was able to push Atomic's agentic AI to the point it was able to figure out the decision rules that a customer's staff might have, even if they had not been written down anywhere. McNeil said, then customers were saying, okay, then you might as well make the decision and free my time up. And where executives kind of got it was, you know, decision speed is an advantage in any business.

5:14And this was one of our first principles at Tesla. Rossiter said he's excited to help pull customers' supply chain efforts out of spreadsheets and into advanced software that can help make planning decisions. It is an evolution. He's seen CFOs lead for their own organizations, but he said it's rarer to find someone doing the same for operations.

5:40AI startup Elise AI announced this week that it has raised$350 million at a$4 billion valuation, double what it was worth when it raised its Series E last August. This latest round was co-led by Andreessen Horowitz and Bessemer Ventures. Now, Elise AI, founded back in 2017, automates administrative and operational work for housing and healthcare companies. It said its software is used by one in six apartments across the country and announced this summer it passed $200 million in ARR. Earlier this month, Elise announced the launch of an AI teammate called Apollo that helps with tasks inside the Elise AI platform.

6:24Co-founder and CEO Mina Song told TechCrunch it's built natively into the same platform that already runs leasing, maintenance, and renewals, so it can act across every role on a property team. Mina said that Elise AI also helps automate the patient-related paperwork for specialty physician groups on the healthcare side, from the first inbound call through referrals, scheduling, insurance verification, chart prep, and follow-up, so nothing falls through the cracks. The company has targeted housing and healthcare because they are two of the largest expenses for American households. That's all I've got for you today.

7:02For the latest in startup tech news, go to techcrunch.com.

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