New York-based Melius, which provides AI tools for generating ad campaigns, images, and videos, raised $25M, including a $20M Series A and a $5M seed

AI tools for ad creative generation are now a proven market, attracting significant venture capital.

Melius, a New York-based AI platform for generating ad campaigns, images, and videos, has secured $25 million in new funding. The round includes a $20 million Series A led by CRV and a $5 million seed round backed by General Catalyst. The company, founded by former Ramp engineers, pivoted its strategy after its initial performance marketing tool failed to gain traction. Melius now focuses on providing AI tools for creative asset and campaign generation, a market it believes is large enough to support multiple players. The startup claims to have achieved over $1 million in annualized revenue within two months of launching its current product out of stealth in July.

The substantial funding indicates strong investor confidence in Melius's pivot and its AI-driven approach to creative production in advertising. This move validates the shift from AI-powered ad spend optimization to AI-generated creative content, a segment experiencing rapid growth. The company's ability to attract significant capital and claim substantial early revenue suggests a burgeoning demand for tools that can rapidly produce diverse advertising assets.

Melius's success, despite scrapping its initial product, highlights the dynamic nature of the AI startup landscape and the importance of adaptability. The company's focus on creative generation places it in direct competition with established players like Higgsfield, signaling an intensifying race for market share. Investors are betting that Melius can carve out a significant niche by empowering brands and marketers with efficient AI-powered creative solutions.