A Houston fintech startup is aiming to modernize banking and investing — and has received fresh funding to do it. Photo via Getty Images

A Houston startup has raised millions for its fintech platform — and the company didn't have to go very far to find its lead investor.

Brassica Technologies Inc. closed its seed round at $8 million with Houston-based Mercury Fund leading the round. Valor Equity Partners, Long Journey Ventures, NGC Fund, Neowiz, Broadhaven Ventures, Armyn Capital, VC3DAO, Alpha Asset Management (Korea), and other global FinTech investors participated in the round as well.

The startup's platform has "institutional-grade solutions for the new era of private investing and alternative assets," per the release. Serving the alternative assets industry, Brassica's tools can easily integrate with any operating system to provide proprietary technology and unique regulatory licenses. The technology aims to modernize key banking and investing infrastructure to help enterprises safely grow their business and protect their customer assets.

With its "investment infrastructure as a service" model, Brassica was co-founded in 2021 by two familiar faces in Houston's fintech scene. CEO Youngro Lee and CTO Bob Dunton were behind NextSeed, a crowdfunding platform that allowed businesses to raise investment funding online. The startup was acquired in 2020 by Republic, where Lee currently serves as executive vice president and head of Asia.

“The future of finance will depend on the ability of trustworthy institutions to provide secure and seamless transitions between traditional financial services and web3 innovations while complying with strict regulations and still providing great customer experience,” says Lee in the news release.

“Today’s infrastructure solutions for alternative assets are often cobbled together through multiple incompatible vendors in a complex regulatory environment, which often creates unreasonable risk, errors, and single points of failure for market participants," he continues. "We started Brassica to address this fundamental problem and provide solutions to enable innovators in both traditional and web3 industries to build properly within a constantly evolving global regulatory framework.”

Along with the seed round news, the company has announced that Brassica Trust Company, its wholly-owned subsidiary, has received a Trust Charter by the Wyoming State Banking Board.

“The revolution of the private markets is here, and it is clear that the traditional, legacy infrastructure currently in place is not designed for the present and future investment world,” says Blair Garrou, managing director at Mercury Fund, in the release. “Brassica’s API-forward, institutional grade solutions make investing in private and digital assets more trustworthy, compliant, and secure than ever before, further bridging the gap between the worlds of traditional and decentralized finance. Their highly qualified and experienced senior business, legal, and technology executive team makes Brassica well-positioned to usher in this new era of alternative investments. We are proud to support Brassica on their ongoing mission to democratize finance globally.”

The company plans to use the funding to grow its product, engineering, business development, and customer success teams, per the news release, as well as develop a trust operations team in Wyoming. Current leadership includes former execs from Republic, Cleary Gottlieb, Kirkland Ellis, Morgan Stanley, Custodia Bank, LedgerX, Prime Trust, JP Morgan Chase, and M1 Finance.

Youngro Lee has announced funding for his latest fintech endeavor. Photo courtesy

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Houston AI femtech startup raises $2M round to expand platform to B2B opportunities

fresh funding

A Houston-based startup that's improving health and wellness for women with its artificial intelligence-backed platform has raised a bridge round of funding.

Ema closed its latest bridge round, bringing its total funding to nearly $2 million. The company received investment from Kubera's Venture Capital and Victorum Capital, which joined existing investors Hearst Labs, Wormhole Capital, Acumen America, and Techstars.

Ema strives to deliver "personalized, empathetic, and evidence-based support" to its users through its generative AI technology. The platform has more than 100,000 users, and has expanded into the B2B sector with $100,000 in contracts within just 30 days after pivoting to this model, according to the company.

"Ema was born from a deep-seated belief in the transformative power of AI to make women's health care more accessible and effective," Amanda Ducach, CEO of Ema, says in a news release. "Our recent funding and rapid B2B growth validate our approach and enable us to further our mission."

The company, originally founded as SocialMama looking to connect mothers digitally to each other and, later, physicians and experts, rebranded a year ago. The platform aims to be comprehensive and holistic to positively affect women's health and wellness journeys across life stages and categories.

"Our vision extends beyond immediate health concerns; we see Ema as a companion that can support women throughout their lives, offering guidance, support, and understanding whenever they need it," Ducach explains. "This latest round of funding will help us expand into new areas, including employee benefits, where we believe we can make a substantial difference."

Amanda Ducach founded the company in 2019. Photo via Twitter

Why founders need to be prioritizing problem-solution fit, according to this Houston innovator

guest column

Over the past 10 years I have been so incredibly fortunate to work for and with dozens of startup ecosystems, startup development organizations, competitions and accelerators.

Through these interactions I have mentored, advised and coached over 500 startups and as I've reflected back on these interactions and relationships I have observed some crucial insights that I am humbled to be able to share here with you — starting with the importance of problem-solution fit.

My top observation is that the success of founders often hinges on their focus on a specific problem, from the perspective of the problem holder (which is not always their customer) and particularly a problem set they care deeply about. This focus is far more impactful than merely having a great idea. Founders with a laser focus on a problem, showed remarkable advantages. These founders were:

  • Quicker in Validating Assumptions: Their problem-centric approach allowed them to more rapidly test and validate their hypotheses about market needs and solutions.
  • Focused on Data-Driven Decision Making: They were more receptive to letting data guide their strategic decisions, leading to more grounded and effective strategies.
  • Agile in Pivoting: When confronted with challenges or new information, these founders could pivot more efficiently, as their commitment was to solving the problem, not just to their solution.

This problem-focused mindset proved to be a significant differentiator in their journey from ideation to success.

For these reasons, the philosophy that problem-solution fit leads development, has become a cornerstone in my approach to fostering innovation. It underscores the need for startups and organizations alike to delve deeper into understanding the real challenges they face, the first order problems, which in turn opens doors to more impactful and sustainable solutions.

Most recently, In my time at MassChallenge, my approach to problem identification diverged significantly from industry norms. The crux of my strategy was to shift the founders' focus from their innate bias towards their innovation or the allure of monetary gain to a deeper connection with the underlying problem — transforming the innovator's bias into the innovator's gift.

In my interactions, I often met two predominant types of founders:

  • Technical Founders: These individuals were deeply enamored with the technology or product they created. Often coming from the research world or a technical / engineering background within one industry. Their passion was more about the innovation itself rather than its impact or the problem it aimed to solve.
  • Profit-Oriented Founders: These founders were driven primarily by the potential for financial success. Often coming out of Business school, consulting firms or investment / banking background. Their focus was often on the market opportunity, timing, size and scale rather than the problem needing a solution.

I am not a believer that anyone fits into a box but these were broad commonalities I observed over time. While neither mindset is inherently flawed, it became evident that a third type of founder, those who developed a passion for solving a specific problem — often tied to a personal or emotional connection — tended to achieve greater success.

The challenge lay in transforming the mindset of founders who initially did not have this problem-centric focus. To do this, I employed a series of exercises and mental experiments that anyone can do aimed at uncovering the true purpose behind their ventures. Two pivotal tools in this process was Simon Sinek's Golden Circle, which helped delve into the why behind their companies and Ash Maurya’s Problem Discovery process that he details in Lean Mastery.

These exercises were transformative. Founders typically developed a stronger attachment to these newly framed problem statements than to their initial motivations. It aligned their endeavors with a purpose that was emotionally significant to them, thereby enhancing their commitment and effectiveness in addressing the problem.

This approach to problem identification was not just about finding a market fit; it was about aligning the founders' core values and motivations with the problems they aimed to solve, thereby unleashing the true potential of their innovations.

One of the most significant challenges was persuading founders to shift their mindset from their initial focus to a problem-oriented approach. This transition was often difficult, as change is inherently challenging, especially when founders have invested months or years in developing something they feel deeply connected to. The key was to reframe and redirect their passion towards understanding and solving the core problem for the problem holders that were most affected. This shift in focus wasn't always successful, but when it did take effect, it markedly increased the founders' likelihood of success.

Part of the difficulty in effecting this founder mindset shift stemmed from the overwhelming amount of content directed at startup founders, emphasizing the immediate need for customer feedback and early creation of MVP’s. While these aspects are crucial (at the right time), there is a noticeable gap in guiding founders towards the critical step of identifying problem-solution fit earlier in the process. As a result, many founders fell into the trap of building upon untested assumptions, believing that once they've created a product or identified a revenue model, the journey was set on the right path.

This challenge wasn't confined to startup founders alone, it is prolific across the innovation economy. Corporates, governments, and universities also displayed resistance in identifying their core, underlying problems. They often focused on surface-level issues or immediate technological needs without recognizing the structural problems causing these more visible issues.

As a founder, an innovator, or anyone passionate about bringing new solutions to the masses, this shift in perspective is crucial. It allows founders and organizations to understand their challenges more deeply, leading to more effective and sustainable solutions. It isn’t just about solving the problems they could articulate, but about uncovering the first principles issues that needed addressing.

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Jon Nordby is managing partner at Anthropy Partners, a Houston-based investment firm, and professor of entrepreneurship at the University of Houston.

Rice names inaugural recipients of new grant program that's doling out $360,000

Four Houston research projects are splitting hundreds of thousands of dollars in grant funding from Rice University.

After announcing the One Small Step Grant program in September to support Rice-developed, lab-stage innovations, the university has named its inaugural recipients. After receiving nearly 30 applicants, four research projects were selected to share $360,000 in grant funding.

“Being able to fund near-commercial projects represents a leap forward in our mission of supporting the cutting-edge work of our faculty and students and helping bring those to market,” Adrian Trömel, assistant vice president for strategy and investments, says in a news release. “Feedback from industry and investors show that they’re excited on how the One Small Step grants help derisk these technologies, getting them ready to launch. Watch this space for the next generation of leading deeptech companies.”

The selected projects include:

  • PerisBio, developed by Samira Aglhara Fotovat and Samantha Fleury from Rice Professor Omid Veiseh's Lab, focuses on novel, hydrogel-encapsulated engineered "cell factories" for the minimally invasive treatment of endometriosis. The project received a $100,000 award.
  • Solidec, founded by Ryan Duchanois and Yang Xia from Rice Professor Haotian Wang's Lab, is a room temperature, solid-state direct air capture technology. The project received a $100,000 award.
  • HornetX, led by Rice Professor Aditya Mohite's Lab, aims to produce highly stable green hydrogen using a perovskite-based photoelectrochemical cell with leading efficiency. The project received a $80,000 award.
  • Coflux, developed by Jeremy Daum and Alec Ajnsztajn from the labs of Rice Professors Rafael Verduzco and Pulickel Ajayan, focuses on covalent organic framework-based photocatalysts for instream remediation of PFAS (per- and polyfluoroalkyl substances) from water. The project received a $80,000 award.

The Office of Innovation created an investment advisory committee — made up of entrepreneurs, investors and corporate executives across industries — to select these recipients. The grant program was funded by the Office of Innovation, with support from Breakthrough Energy Fellows for climate and energy projects

“The inaugural winners of the One Small Step Grant represent the innovative spirit and dedication to excellence that defines our students and faculty," Rice Chief Innovation Officer Paul Cherukuri says. "We are proud to support these groundbreaking projects on their journey from lab to market."