Oslo-based Gelato, an artificial intelligence firm specializing in print-on-demand services, recently experienced a meaningful setback after a crucial funding round collapsed in late November 2023 [[1]].The failed $23 million USD investment prompted Gelato’s CEO to issue a stark internal warning, signaling growing anxieties within the AI sector regarding economic headwinds and investor confidence [[3]]. This situation highlights the increasing difficulty even established AI startups face in securing capital as the market matures [[1]].
Investment Collapse at Norwegian AI Firm: “The World is Going to Hell”
Oslo-based artificial intelligence company, Gelato, experienced a dramatic collapse in a recent funding round, according to reports on November 28, 2023. The failed investment, which aimed to raise 250 million Norwegian kroner (approximately $23 million USD), has prompted stark warnings from the company’s founder and CEO, Erik Svendsen.
Svendsen reportedly told employees, “The world is going to hell,” following the breakdown of negotiations with potential investors. The company had been seeking the funds to scale its AI-powered print-on-demand network, which connects customers with local print providers globally. Gelato’s technology aims to streamline the production and delivery of printed materials, reducing shipping times and environmental impact.
According to sources, the investment talks fell apart due to concerns surrounding the current economic climate and the perceived risks associated with the AI sector. The company had already secured commitments from several investors, but these were contingent on reaching the full funding target. When the round closed short of its goal, the commitments were withdrawn.
Gelato has been actively seeking alternative funding options, including exploring strategic partnerships and potential acquisitions. The company stated it is working to secure bridge financing to maintain operations while it pursues these avenues. The failed funding round underscores the challenges facing even promising AI startups in a tightening financial environment.
The company’s technology focuses on automating the print process, offering a distributed manufacturing model that aims to disrupt traditional printing industries. Gelato operates in 31 countries and serves a diverse range of customers, from individual creators to large enterprises.
“We are in a very challenging situation, but we are not giving up,” Svendsen reportedly said. “We believe in our technology and our vision, and we are determined to find a way forward.”
