NanoClaw creator turns down $20M buyout offer, raises $12M seed instead

NanoCo, the company behind security-focused OpenClaw alternative NanoClaw, has raised an oversubscribed $12 million seed round following a viral launch, its founders tell TechCrunch.

The funding was led by Valley Capital Partners, and saw participation from Docker, Vercel, Monday.com, Slow Ventures and angels like Clem Delangue, CEO of Hugging Face. 

In a matter of weeks, NanoClaw creator Gavriel Cohen (pictured above, left) said he went from coding the project on his couch to receiving viral endorsements from Andrej Karpathy and Singapore’s foreign minister, fielding inbound interest from dozens of investors, and even a roughly $20 million acquisition offer that he and his brother and co-founder, Lazer Cohen (pictured above, right), declined.

“It was under six weeks from committing the first lines of code to a term sheet,” Gavriel told TechCrunch. 

“There was a lot of inbound and interest,” he added. “People reaching out in DMs on X and sending emails.” He estimated that about 50 or more founders and tech executives sent DMs asking to invest. 

One of them was Delangue, who dropped a note: “I like what you’re doing with NanoClaw.” Gavriel then responded in kind, telling the Hugging Face CEO that he liked the company’s tiny robot, Reachy Mini, and hoped to run NanoClaw on it one day.  

The two programmers then started talking shop, and Cohen eventually asked Delangue if he was interested in angel investing and secured a yes.

As it turns out, an active member of NanoClaw’s open source community is already working on running it on Reachy Mini, Gavriel says.

As we previously reported, interest in NanoClaw skyrocketed after AI researcher Andrej Karpathy tweeted his praise for it. But the project really began to snowball after the Foreign Minister of Singapore called NanoClaw his “second brain” in a Facebook post that went viral.

NanoClaw was created as a secure alternative to OpenClaw to assist the Cohen brothers with their previous startup, an AI marketing firm that used agents to do much of the work. But instead of running directly on a computer, with access to all services and credentials, NanoClaw runs sandboxed in a container — a practice that is becoming a common solution to running more secure, OpenClaw-like setups.

But a couple of months ago, the idea was novel and took on a life of its own. Seeing the interest, the Cohen brothers began talking to investors and other founders asking for advice. Should they turn this free project into a company? How? 

One VC offered to buy the project right then for one of his portfolio companies, offering a “six-digit” dollar amount, Cohen said.

While contemplating that, they met a founder friend who gave them a key insight: Open-source projects grow exponentially more valuable as their community grows. Not only do these users help contribute code to mature the project quickly, but they discover and demonstrate various uses as well.

He told the Cohen brothers that if they believed NanoClaw could be that kind of project, they would have to quit their other venture and commit to it.

“He was right,” Gavriel said. Shortly after they shuttered the other business and focused, the viral posts came, and their new outfit secured partnerships with Docker and Vercel. 

About two weeks after that first offer, they got another, this one for around $20 million, including jobs to stay and run their company. The brothers declined that one, too.

“Since then, it’s only escalated. We have many thousands of people using NanoClaw,” he said.

NanoCo has now started booking enterprise customers, an idea that came from its community. The product’s early adopters have been people with technical skills, many of whom are executives at big tech companies. After these users set up their own NanoClaw instances, they kept getting hit up by coworkers asking for help to do the same. 

These folks don’t want to become NanoClaw IT people, Cohen explained, but NanoCo does. So it is offering implementation services, these days known as “forward-deployed engineers,” to help businesses roll out NanoClaw AI agents to employees and provide ongoing support.

While NanoCo declined to specify who their early enterprise customers are, the brothers say that executives at companies like Amazon, Gap, Google, Meta, SentinelOne and Accenture are using NanoClaw itself.