An AI startup founded by former engineers at corporate finance software company Ramp has secured a total of $25 million in funding after abandoning its original product concept and rebuilding from scratch. The company, called Melius, announced the raise on Tuesday, which includes a $20 million Series A round led by CRV and a $5 million seed round led by General Catalyst.

Melius describes itself as an AI-powered platform capable of generating advertising campaigns, images, and videos. According to the company, it surpassed $1 million in annualized revenue within just two months of emerging from stealth mode in July. Despite that early traction, co-founder Joowon Kim is candid about the fact that the startup's initial direction did not go as planned.

From Performance Marketing Tool to Creative AI Platform

When Melius first launched more than a year ago in New York, Kim and his co-founders - Young Kim and Arnav Ramu - were focused on building an AI-driven performance marketing tool. The three had worked together as engineers at Ramp, the business spending and financial management software firm, before deciding to strike out on their own.

Their original vision was to help marketers better manage and optimize their advertising spend. However, after more than six months of building that product, the team concluded that the idea simply did not have enough potential to justify continued development.

"We scrapped the entire codebase; we burned all of it," Joowon Kim said.

Rather than refining their initial concept, the founders made the decision to pursue what they believed was a significantly larger opportunity: building tools that could generate the actual creative assets and advertising campaigns themselves, rather than simply managing how money was spent on them.

The team moved quickly to develop an entirely new product. Nearly a year after the company's original launch, Melius unveiled a platform it describes as an "agents lab for creative work" - a system designed to let users produce ad content and visual media using natural language instructions.

A Competitive but Growing Market

Melius is entering a market that has attracted considerable attention and investment. Several other companies are working to help advertising agencies, brand teams, and independent marketers produce creative content using artificial intelligence. Among the most prominent competitors is Higgsfield, a three-year-old company that was valued at $5.4 billion as recently as August and has reported more than $700 million in annualized revenue. Other players in the space include smaller startups such as Krea and Flora AI.

Despite the presence of well-funded rivals, Kim says he is not worried about the competitive landscape. He acknowledged that Higgsfield is expanding at a rapid pace, but argued that the overall market is large enough to sustain multiple successful companies operating within it.

"There are a lot of players, which is pretty exciting. That means there are customers to be won and there is demand in this space," Kim said.

A Personal Connection to Creative Media

The decision by three engineers with backgrounds in financial technology to build a product focused on advertising and creative content generation might seem unexpected. But for Joowon Kim, the direction is rooted in a lifelong interest in digital media and video production.

Kim, who identifies as a social media influencer, says his passion for making short-form video content dates back to his elementary school years. He once had aspirations of becoming a well-known presence on YouTube, spending time trying to produce his own vlogs.

"I tried my best to make vlogs. My dad was great at using FinalCut Pro, but I wasn't," Kim recalled.

Those early attempts at video creation never gained much of an audience, but his interest in digital media production never faded. That personal history now informs the product he is building. With Melius, Kim says the goal is to create a platform accessible to anyone - from professional creative directors to everyday users - allowing them to bring ideas to life through simple, plain-language input rather than requiring deep technical or design expertise.

The company's funding and early revenue figures suggest there is market appetite for what Melius is offering. Whether it can carve out a durable position in an increasingly crowded field of AI creative tools remains to be seen, but the team's willingness to abandon their first product and rebuild entirely appears to have set them on a more promising trajectory.