Newsletter: AI investment activity, a platform perspective. #3

This newsletter covers weekly artificial intelligence (AI) investment activitythat fits four broad themes, namely: industry 4.0, entertainment sector, infrastructural software, and healthcare. For a more detailed description of these themes, please go to the first newsletter.

The primary goal of the newsletter is to explore how AI startups are integrated into value/supply chains, and what kinds of platforms may be built around these startups.

The newsletter covers the US, Canada, Europe and Israel. It’s stage agnostic and covers startups from inception through growth stages.

If you want to skip my analysis and jump to data, go to the end of the note to find a table and a link on a spreadsheet with data on featured companies and associated sources.

Newsletter 01.10.2018–07.10.2018

Key themes

• This week shows the diversity of AI applications. 6 out of 13 featured startups develop their product for multiple industries simultaneously. For example, Kittyhawk.io offers its drone platform to insurance, construction and media sectors, to name a few. Elemental Machines and its platform that helps ‘…laboratories manage valuable samples and materials, and track the ambient environment where experimental work is performed’ suits to biotech and pharma, veterinary and animal research, chemistry and materials science facilities, among other things;
• Automotive continues to be a hot sector– this week we have a mega-round in Cruise Automation, where Softbank and GM brought a fresh $3.35B infusion. Another large round is a $45M raise by Aeva. Aeva combined lidar sensors, radar and multiple cameras into a single integrated box that can see and track objects up to 200 meters ahead;
• AI improves tech and affects progress — AI-powered startups seem to be well-positioned to change the pace of tech progress in various high tech sectors, whether it is materials science (Element Machines) or chip manufacturing (Motivo).

Tech platforms

This week I’ve identified just five tech platforms, among them are:

• Elemental Machines is a good example of a data platform, that not just aggregates and integrates data from various sources, but provides infrastructure for data collection in challenging settings. Element Machines offers a portfolio of plug-and-play wireless sensors that continuously monitor critical equipment and the lab environment (Pic. 1);

Pic. 1. Sensors by Element Machines

• Cruise Automation and Kittyhawk.io are platforms to build autonomous agents, cars and drones respectively;
• Heed is one of a few content creation and sharing platformfeatured in my review. Its tech allows to highlight and share important moment of various sport events.

Business platforms

This week’s startups highlight the ability of AI to make existing technologies more user-friendly. It also demonstrates how the demand for previous technologies, whether it is medical tests or internet retail, creates the demand for AI-powered tech. For instance:

• Medicus helps patients to understand medical reports and makes interaction between doctors, labs and patients easier. The startup does not aim to develop new lab tests technologies, rather focuses on increasing usability of existing ones;
• Deliverr builds on the amazing progress of internet retail. The company offers fulfilment services from multiple warehouses, and builds a Uber-like service. That’s what one of co-founders says: ‘Uber didn’t change the physical infrastructure of cars. They didn’t build their own taxis. What they did was create software that could connect excess capacity drivers. Most warehouses aren’t going to be full. We are going in and filling that extra space they wouldn’t otherwise fill’. Deliverr uses machine learning to determine which of its warehouses to store goods.

Chart 1. AI companies that disclosed funding during the week 01.10.2018–07.10.2018, $M​

Data is here (Google spreadsheet)

All data is from open sources and all conclusions/ideas/analysis are built only on publicly available information. For data sources see google spreadsheet.

* A company is positioned across a value chain if it has distinctive offers for several its elements. If I misunderstood the value proposition of your startup, please do let me know.

** A company is defined as a platform in tech sense if someone can build up on it. I identify a comapny as a tech platform purely based on public sources, so if I misunderstood your startup, please do let me know.

This newsletter does not intend to cover all AI transactions, but covers just four themes in a limited set of geographies.