The homepage of the Hamburg AI startup Oxolo states: “We regret to announce that Oxolo will cease operations on August 31, 2024.” Customers can still log in until the end of August, after which data will be deleted in accordance with the General Data Protection Regulation, it says. A support email is provided for questions. Under the heading “Termination of Oxolo” it also states: The company is acting “due to market dynamics” and following a “strategic realignment”. “Despite our best efforts, we faced significant obstacles in maintaining a competitive advantage and keeping pace with technological advances.”
That came as a surprise. The company, which scene star and serial entrepreneur Heiko Hubertz, founder and ex-CEO of the software company Bigpoint, one of the largest German game manufacturers, and his co-founder Elisabeth L'Orange had launched in 2021, seemed to be on the road to success. And well financed after a Series A of 13 million euros in autumn 2023, including from DN Capital and business angels such as multi-entrepreneurs Christian Vollmann, Johannes Plehn and Thomas Hagemann, founders of Seven Senders, Alex Täubert, Head of Startups at Google, and IDnow founder Felix Haas.
Oxolo: AI-generated marketing videos
Oxolo was considered one of the frontrunners in the field of AI, also because the startup had an applicable, easy-to-understand product at the start: With the help of the startup's GenAI, companies, primarily e-commerce operators, can create AI-generated marketing videos, with human-like avatars if desired. The market for such video content is huge, according to the pitch deck for the 13 million round, which Gründerszene has obtained: The e-commerce industry would have spent 570 billion dollars on marketing in 2022, 20 percent of which on videos. Oxolo had already managed to increase customers and revenue tenfold in the previous six months.
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What has changed? And what does that mean for the company's 40 or so employees? Gründerszene asked co-founder and CCO Elisabeth L'Orange. The founder expressed her frustration with complex regulations and requirements that make life difficult for entrepreneurs in Germany, she says. From the AI Act to the GDPR – such hurdles are enormous for startups.
There is a message on your website that Oxolo is ceasing operations. You say that this is not about the company closing down. But you are not continuing what you have been doing. Why?
Basically, there are three big problems for which we can find no other solution than this step. Problem number one: The EU AI Act came into force on August 1st. This has changed the conditions for us.
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But it has been in the works for a long time and has gradually come into force since the beginning of the year.
Source: https://www.businessinsider.de/gruenderszene/business/harter-schritt-ai-startup-oxolo-stellt-vorlaeufig-den-betrieb-ein-was-ist-passiert/
