The pair then set themselves up as hired guns, creating apps for companies who wanted to move beyond basic AI chatbots.
“We’d get on the phone with anyone who would give us the time of day. And we’d build them whatever they wanted at an extremely discounted market rate,” Mosen says.
They didn’t seek out any particular niche, but one found them, on the blue-collar side of the fence.
“There was a lot of recurring issues and problems in steel, construction, manufacturing services in the United States, like, particularly around back office document processing, and those kept on popping up more and more and more,” Mosen said.
‘A terrible business model’
He and Englander would go in, create a bespoke AI solution, then head off into the sunset.
“It was a terrible business model, because we’d code everything from the ground up for the client and then just hand it over to them. We didn’t own it. We didn’t get any recurring revenue.”
The pair decided to create their own AI platform that would solve common problems for logistics and construction firms. Their start-up, Sea12, was born in May 2024.
Mosen decided to go all-in on the firm, dropping out of varsity to join Englander in New York.
“We were completely bootstrapped. We had US$30,000. We rented a tiny office and hired two interns,” Mosen says.
He was CTO wraning the tech, Englander CEO, focusing on sales.
“I thought, ‘We’ve got the summer to make it happen,’ because we would run out of runway in September,” Mosen says.
In the event, the runway expanded as they built their platform then started to sign more and more clients.
Quick-fire raise
“We started getting noticed by a couple of VCs [venture capital firms],” Mosen says.
“We raised our first seed round for about US$4 million, which was a big relief for us. We finally had room to breathe. We’d been bootstrapped for a year at that point.”
Most of the capital for that round, and a follow-up Series A that took their total funding to around US$25m ($43m) came from Caffeinated Capital.
“The process was really quick,” Mosen says, remembering the seed round.
“Our GP [general partner] at Caffeinated, Varun Gupta, called Charles on a Friday, chatted with him for an hour or two, then called me on Saturday. We chatted on the phone for like 45 minutes then they sent us a [term] sheet on Monday.
“I was shocked because I thought it would be a multi-month process. If you’re not attached to AI, it’s hard to raise that amount that quickly, but we were fortunate.”
Big in Texas
With the seed money secured, “We could start hiring fulltime people and we started going after bigger and bigger accounts; big steel companies; big logistics companies. We started doing a lot of outreach.”
The groundwork for the Series A did prove more involved, stretching from November into early this year.
Mosen says his firm now has “seven-figure revenue” and several large customers including Texas-based Basden Steel, “which took nearly a year to land”.
“They build military bases, airports, hospitals, high schools, really anything that needs like a steel structural frame,” Mosen says.
“What we do with them is really a lot of back office automation, so processing all their steel order documents, routing what parts need to be built in what shop, processing their invoices, and making sure they’re not getting double-charged for certain steel orders.”
Basden introduced Sea12 to one of their suppliers, Colorado’s Brown Strauss Steel, who also came on board. Others followed.
While, many AI start-ups focus on the likes of fintech, real estate and customer service, often with West Coast bent, Mosen and Englander had stumbled on what the Kiwi calls “the backbone of the country”.
Sea12 is now looking to expand into other industries.
‘Team Anthropic’
What’s his preferred flavour of AI?
“We’re pretty Team Anthropic for most of our coding,” Mosen says.
“I’m a big fan of that company. But we’re also using OpenAI’s Codex, which is pretty cool too.”
It helped that an OpenAI account manager offered a US$15,000 credit to help keep Sea12 on the hook.
New school, old school
Revenue is rising.
“We want to get to eight-figures by the end of the year,” Mosen says.
The start-up now has an office on Broadway and 14 staff. It’s advertising for another four.
“We had to learn how to hire people. It’s definitely a skill,” Mosen says.
He says it’s trickier in an AI boom where, “The top 1% of engineers are hopping around every couple of months to different companies, and it’s really tough to retain them, unless you pay them exorbitant amounts of money. And even then no amount of money will make them stay if they don’t like the culture – so that’s something we’ve been very focused on.”
The stereotype is that pandemic-raised Gen-Z favours hybrid and remote work, but Mosen says, “We’re an in-person company. I think it’s important, for the culture, to have everyone in the office.”
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He adds, “It helps to create a fun environment, but I also don’t know what I’d do if I wasn’t able to just lean back in my chair and just ask someone on the other side of the room a question and get an immediate response.
“There’s something about sitting around a whiteboard with another engineer and scoping something out. You get 10 times more stuff done in a day. You don’t have to schedule meetings. You don’t have to wait for a Slack response.”
After its quick-fire early fundraising, a Series B round isn’t on the radar.
“We’re skimming along, spending just slightly more money than we’re earning,” Mosen says.
“We want to get to at least over US$15m per year before we think about it.”
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.