AI Finance Watch

Eye On A.I.
Sep 2, 2018 · 6 min read

This week’s newsletter in full below complete with hyperlinks to the original announcements and market commentary from Bruce Taragin, managing director at Blumberg Capital.

Oak HC/FT Makes Third AI Investment In Two Months

The Artificial Intelligence finance newsletter gets readers up to date on the latest funding news and related issues.

· Mergers and Acquisitions

TransPerfect, the New York City-based corporate language and technology services provider, said it acquired Spain’s Tauyou, which uses AI in corporate translation services. Tauyou founder Diego Bartolome becomes TransPerfect director of AI.

Apple, the Cupertino, California-based electronics firm, bought Akonia Holographics, which makes lenses used in AR equipment, according to Reuters report.

· Filings

Nio, the Shanghai, China-based electric vehicle maker, said it plans to raise USD 1.5bn from the initial public offering of 160m American depositary shares at USD 6.25 to USD 8.25 each on the NYSE. That’s slightly less than the USD 1.8bn it originally said it planned to raise. The Tencent-backed firm is also developing autonomous driving technology.

SGOCO, the Hong Kong-based company developing virtual reality technology, announced terms for a USD 50m one for one rights offering closing September 20.

Fuqin Fintech, the Beijing, China-based online lending platform using AI, said it is raising as much as USD 21m from the initial public offering of as many as 3.5m shares at USD 5.00 to USD 6.00 each on the Nasdaq.

LAIX, the Shanghai, China-based company using AI in English language learning, said it plans to raise USD 100m in an initial public offering on the NYSE. Company founders will maintain voting control in a dual-class shareholding structure.

Qutoutiao, the Shanghai, China-based mobile news aggregation service using AI, said it plans to raise USD 300m in an initial public offering on Nasdaq.

Other filings included Eventbrite

A Quote For The Week

“AI is converging with big data, in FinTech, digital health and other areas, and it is still in the nascent stages. According to a recent IDC survey, 77 percent of enterprise CIO’s claim they are hitting an infrastructure wall. As a result, we expect to see a ‘productization’ of the AI infrastructure required to make the data useful going forward.”

Bruce Taragin, managing director at Blumberg Capital, speaking at the recent HMG Global Innovation Summit in New York

· Funding

FLIR Systems, the Wilsonville, Oregon-based radar, infrared and thermal imaging equipment maker, said it invested an unspecified amount in machine learning company CVEDIA.

Medicrea, the Lyon, France-based health care company using machine learning to develop spinal care treatments, said it began trading over the counter in the US. The company’s shares trade on the Euronext growth board in Paris.

Voci Technologies, the Pittsburg, Pennsylvania-based company using AI to transcribe audio and video recordings, arranged a USD 5m credit facility with Square 1 Bank, a division of Pacific Western Bank. Voci was spun out from Carnegie Mellon University.

Phrasee, the London, UK-based marketing firm using AI, said it raised USD 4m in a Series A led by Albion Capital.

Exabel, the Oslo, Norway-based company using AI to develop investing services, said it raised NOK 38m (USD 4.7m) in a second seed round from domestic investors.

Pagaya, the Tel Aviv, Israel-based financial technology company using AI, said it raised USD 14m in a Series B led by Oak HC/FT and former American Express CEO Harvey Golub.

This marks the third AI-related investment by Oak HC/FT in two months. In August the venture capital fund co-led a USD 32.8m in a Series D round for Olive, the Columbus, Ohio-based company using AI to cut healthcare costs. Oak also led a USD 30m Series B in Groundspeed Analytics, the Ann Arbor, Michigan-based firm developing AI-backed insurance processes., the Beijing, China-based autonomous driving developer, raised RMB 220m (USD 32m) in a Series B led by a unit of investment bank China International Capital, according to a China Money Network report.

Tempus, the Chicago, Illinois-based company using machine learning to analyze medical data, said it raised USD 110m in a Series E from funds including T. Rowe Price. Tempus was started by Groupon cofounder Eric Lefkofsky.

Avegant, the Belmont, California-based AR headset maker, said it raised USD 12m in what it called a Series AA funding led by venture capital fund Walden International.

In other news, Seven Stars Cloud, the New York City-based AI and blockchain services firm, said it is changing its names to Ideanomics.

In late August the company said shareholders, which include Sun Seven Stars Investment and Hong Kong Guoyuan Group Capital, may raise USD 111m from the sale of 37.7m shares they hold in the company. It originally filed in April. In June, Seven Stars hired Richard Frankel as chairman and CEO and Manuel Ron as COO at its digital advisory services subsidiary, Red Rock Global Capital.

China’s AI company Gridsum said the Nasdaq had granted it more time to regain compliance with listing regulations.

And, all the AI hype could lead to another “winter” for the industry, according to Popular Science.

· Legal & Regulatory

US Securities and Exchange Commission head Jay Clayton said it plans to review regulations in an attempt to reduce the costs for smaller companies to remain public and to allow companies raising capital greater freedom to sound out investors before formally launching deals. Clayton, speaking at the 36|86 Entrepreneurship Festival, also outlined steps the SEC has taken to help private companies raise capital. Read his complete remarks here.

Government investment is needed if general AI is to ever really take off, according to an article in Futurism.

· People

German Bionic, the Augsburg, Germany-based robotics maker, said it hired Armin Schmidt as CEO. Schmidt is the founder of AUPEO, a streaming service, and internet of things platform ATS Advanced Telematic Systems. The company makes equipment industrial employees wear to increase strength and endurance, called exoskeletons.

Geopulse Exploration, the Los Angeles, California-based company developing a logistics and consumer platform for the cannabis industry with blockchain, said it has hired Zuber, Lawler and Del Duca’s Josh Lawler to advise on its upcoming initial coin offering.

Cannabics Pharmaceuticals, the Tel Aviv, Israel-based company using AI to develop treatments for the side effects of cancer therapies, said it has brought former Intel executive Dr Giloz-Ran onto its advisory board.

Aromyx, the Palo Alto, California-based biotech firm using AI, said it hired Dr Shunling Guo and Dr MidEum Lee as senior scientists. Guo was last a scientist at ConfometRx. Lee was a post-doctoral research fellow at Dartmouth College. Aromyx is backed by Stanford University.

JPMorgan, the New York City-based investment bank, hired Google’s Apoorv Saxena as head of AI and machine learning services, according to a CNN report.

LexinFintech, the Shenzhen, China-based online lending platform using AI to target young adults, said Xiaoguang Wu has joined its audit, compensation and corporate governance committees.

CLARA analytics, the Santa Clara, California-based insurance services firm using AI, said Ruth Estrich has joined its advisory board. Estrich was previously chief strategy officer at MedRisk, but had retired. CLARA is focused specifically on workers compensation

Software, the Darmstadt, Germany-based AI software developer, said it hired Raj Datta as president of North America. Datta was previously at analytics startup CiBO Technologies and IBM.

AWM Smart Shelf, the Aliso Viejo, California-based retail sector analytics firm, said it hired Leo Tsourides as head of science to oversee the development of AI at the company. Tsourides is a research affiliate at Massachusetts Institute of Technology.

SambaNova Systems, the Palo Alto, California-based AI company, said Dr Edward Frank, a former executive at Apple and Sun Microsystems, has joined its advisory board. The company is backed by Google’s venture capital fund.

Other hiring included Welldoc

· Data

No new sets of data were released in the areas we track this week

Eye On A.I.

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