The two then launched themselves as hired guns, creating apps for companies looking to go beyond basic AI chatbots.
“We got on the phone with anyone who would give us the time, and we built whatever they wanted at a deeply discounted market price,” Mohsen says.
They weren’t looking for a specific niche, but they found themselves on the blue-collar side of the fence.
“A number of issues and issues were occurring repeatedly in U.S. steel, construction and manufacturing services, particularly with back-office document processing, and they continued to occur more and more,” Mohsen said.
“Terrible business model”
He and Englander went inside, created a bespoke AI solution, and then rode off into the sunset.
“It was a terrible business model because we were just coding everything from scratch for our clients and handing it to them. We didn’t own it. We didn’t have any recurring revenue.”
The two decided to create their own AI platform to solve a common problem for logistics and construction companies. Their startup Sea12 was born in May 2024.
Mohsen decided to give his all to the company, dropped out of college and joined Englander in New York.
“We were completely bootstrapped. We had $30,000. We rented a small office and hired five interns,” Mohsen says.
He was the CTO in charge of the technology department and focused on sales as Englander’s CEO.
“We’re running out of runway in September, so we thought, ‘We can do that in the summer,'” Mohsen said.
At events, as we built our platform, our runway grew and we started signing more clients.
quick fire raise
“We started getting noticed by a few VCs. [venture capital firms]” says Mohsen.
“We raised about $4 million in our first seed round, which was a huge relief for us. We finally had some breathing room. We had been struggling to self-fund for a year at that point.”
Most of the funding in this round, as well as the next Series A, which brought total funding to US$25 million ($43 million), was raised from Caffeinated Capital.
“The process was really quick,” Mohsen says, recalling the seed round.
“Our GP [general partner] In a caffeinated shop, Varun Gupta called Charles on Friday, talked for an hour or two, and called me on Saturday. We spoke on the phone for about 45 minutes and then they emailed us. [term] Monday sheet.
“I was shocked because I thought it would be a process that would take several months. If you weren’t interested in AI, it would be difficult to raise that amount so quickly, but we were lucky.”
Caffeinated was the biggest backer, but checks also arrived from SV Angel (whose portfolio includes Anthropic, OpenAI, and Databricks), Haystack (an early-stage specialist who has backed DoorDash, Instacart, and Figma), Also Capital (a pre-seed and seed specialist whose investments include a lot of troublesome aerospace and industrial deep tech), and various angel investors.
big in texas
With the seed money secured, “we were able to start hiring full-time people and started pursuing larger and larger accounts, such as large steel companies and large logistics companies. We started doing a lot of support work.”
Preparations for the Series A, which lasted from November to early this year, proved more complex.
Mohsen said his company, which is now generating “seven-figure revenues” and has several large customers, including Texas-based Basden Steel, “took nearly a year to get off the ground.”
“They’re building military bases, airports, hospitals, high schools, anything that needs steel structural frames,” Mohsen said.
“What we do for them is actually a lot of back-office automation: processing all of the steel order documentation, routing what parts need to be made in which plants, processing invoices, and making sure we’re not getting double billed for a particular steel order.”
Basden introduced Sea12 to one of its suppliers, Colorado-based Brown Strauss Steel, who came on board. Others followed.
While many AI startups are focused on areas such as fintech, real estate and customer services, often with a West Coast orientation, Mohsen and Englander were stumbling in what Kiwis call the “backbone of the country”.
Sea12 is currently looking to expand into other industries.
“Team Antropic”
What is his preferred AI?
“We’re pretty much team people in most of our coding,” Mohsen says.
“I’m a big fan of that company, but I also use OpenAI’s Codex, which is also very good.”
It helped that my account manager at OpenAI gave me a $15,000 credit to keep Sea12 going.
new school, old school
Revenues are increasing.
“We hope to reach eight figures by the end of the year,” Mohsen said.
The startup currently has an office on Broadway and a staff of 14 people. There are 4 more people to promote.
“We’ve had to learn how to hire people, and that’s definitely a skill,” Mohsen says.
“The top 1% of engineers move around from company to company every few months, and unless you pay them an exorbitant amount of money, it’s very difficult to keep them. And if they don’t like the culture, no amount of money will make them stay. So we’re very focused on that.”
Despite the stereotype that Gen Z, who grew up during the pandemic, prefers hybrid remote work, Mohsen says, “We’re an in-person company. I think it’s important for the culture to have everyone in the office.”
“It helps create a fun environment, but if you lean back in your chair and ask someone across the room a question and you don’t get an answer right away, I don’t know what to do.
“There’s something about sitting around a whiteboard with other engineers and thinking things through. You get 10x more work done in a day. You don’t have to schedule meetings. You don’t have to wait for a response on Slack.”
After a quick initial funding round, the Series B round has been unremarkable.
“We’re getting by by spending a little more than we’re making,” Mohsen said.
“We want to get to at least US$15 million a year or more before we consider it.”
Chris Keall is based in Auckland herald’s business team. he herald In 2018, he served as technology editor and senior business writer.
