Fintech Chatter · Nov 2, 2026 · 41m · 31m saved
With Michael Batko, Founder of Hourglass AI and former CEO of Startmate
AI-native startups can now reach revenue with so few staff and so little spending that some may never raise venture capital at all. Michael Batko, founder of Hourglass AI and for eight years CEO of the Australian accelerator Startmate, told Fintech Chatter that this shift is breaking the math venture funds are built on.
Venture investors have long held the power in a funding round. Michael's view is that it has moved back to founders, and that the seed prices that result leave little room for the large returns a fund needs.
"You do get high valuations of a company which has no revenue at 50 or 100 mil seed rounds or higher... if you invest in a company at 100 mil, even if they become a billion-dollar company, that's only a 10x return on that one company." — Michael Batko
Michael backed about 250 companies at Startmate before stepping down in December 2025. His new company, Hourglass AI, builds AI systems inside businesses from venture funds to a meat processor.
The full interview is covered here so you can skip it. 41 minutes of audio, 10 minutes of reading.
Here are the 10 takeaways that matter.
Key Takeaways
AI-native startups may never need venture funding, because their costs are so low and revenue comes faster
Seed rounds at $50M-$100M with no revenue leave a billion-dollar outcome as only a 10x return
A 20-30 company portfolio built that way returns only 30-40% of the fund
A $1B Australian fund puts about $1M-$3M into each first check, holding back 30-40% for winners
Australian VC is only about 13 years old, which is part of why it passed on Zip and Afterpay
Startmate's $50M fund raise froze overnight when tech stocks fell in 2022
A venture fund is "just another manager", paid to turn $1 into a multiple for its investors
1. Eight Years at Startmate
Dexter Cousins, founder of Tier One People, who hosts Fintech Chatter, opened on Michael's record: Startmate backed more than 220 companies, by Dexter's count, and about 250 over Michael's time there by his own. Startmate pairs each company with mentors who invest, often former founders, and they work with the founders every day for three months.
Michael says venture investors give money but have little contact with the companies they back
"Venture capital essentially you give companies money, but you can't really help them that much... because you often just sit on the board and you have very limited touch points." — Michael Batko
The mentors' money is pooled into a fund that makes a fixed investment in each company.
"Most invest between 10 to $50,000 every six months. And that money then is invested into roughly 15 companies every six months. Those companies receive $120,000." — Michael Batko
