Capsa AI Raises £1.7m to accelerate Private Equity due diligence with AI

September, 2024 – Capsa AI, the startup transforming due diligence in private equity, has today announced a seed funding round of £1.7m.

• ⁠Founded less than 8 months ago, Capsa has validated the opportunity with a number of PE funds and delivered clear ROI.
• £1.7m funding will be used to build out the team, hire product engineering talent and scale.
• Platform already delivering clear due diligence time savings of up to 20% for early adopters

Capsa AI has raised £1.7m in seed funding from prominent investors including Cornerstone VC with participation from Antler, alongside angel investors such as Chris Adelsbach, one of Europe’s most prolific fintech investors. The investment was led by Outward VC.

The seed funding round was closed just eight months after Capsa AI was founded. In that time, Capsa AI has already become revenue-generating, serving leading PE funds managing over $30 billion across the US, UK, and Germany.

Capsa AI has developed an AI operating system that allows investors at private equity funds to ‘delegate’ the manual, low-skill due diligence tasks that traditionally take up to 25% of their time. These tasks include activities such as the creation of company profiles, extraction and consolidation of financial information from company records, analysis of financial performance and reviewing customer contracts.

The Capsa AI technology allows PE investors to focus on more valuable and critical tasks, increasing their bandwidth to look at more potential deals and spend more time on value creation. In the coming months Capsa AI will help private equity funds leverage their historical deal data in order to make better investment decisions.

Since launching their product, Capsa AI has co-developed PE specific features with multiple leading PE funds. On average, their early customers have reported a due-diligence time-saving of 20%, and went on to give a 90% customer satisfaction score. Customers cited Capsa AI’s careful consideration of PE-specific workflows and requirements as being a key differentiator from other AI tools.

The capital raised will be used to build out the team, focused particularly on hiring product engineering talent to develop more features for private equity investors. The funding will also be used to penetrate target markets and build out proprietary AI models.

The co-founders, Danyal Özdüzenciler and Callum Downie, met during an Antler residency in London at the end of 2023.

Danyal, co founder of Capsa AI says:

“Capsa AI has received such a positive reaction from investors and customers alike because we are using AI to address a clear and pressing challenge in one of the world’s biggest industries. We are already driving productivity and efficiency in major PE firms and I have every confidence that we can build a product which will transform collaboration, knowledge sharing and decision making in private equity and private capital worldwide.”

Rodney Appiah, Managing Partner at Cornerstone VC, said:

“In a short period of time, Danyal and Callum have created a product that has caught the attention of the private equity sector, harnessing the benefits of AI whilst maintaining flexibility and control over how it is deployed in internal workflows. Their long term ambition to unlock the value of unstructured data within the private markets industry is something that excites us and one we see great potential for going forward. We are delighted to be part of their round and look forward to working with the team as they seek to scale Capsa AI in the coming years.”

Sanchit Dhote, Principal at Outward VC which led the funding round, said:

“The Capsa AI team has developed a groundbreaking solution that is fundamentally reshaping how private equity firms approach due diligence. With private markets experiencing tremendous growth over the past decade, the volume and complexity of data for due diligence has grown exponentially. Capsa is at the forefront of driving the adoption of AI technologies in the PE industry. We are confident that Capsa AI will become the essential infrastructure for managing private assets”

Jed Rose, Partner at Antler, said:

“Danyal and Callum are a world-class founding team combining direct industry experience with machine learning expertise. They have executed quickly and built a product which is already having an impact on private equity. We are delighted to have backed Capsa AI from day zero and have every confidence in their future success.”

For more information visit Capsa AI.