Austin AI startups raised more than $50 Million in 2017
It has been about an year since I wrote about the AI startups in Austin and its potential to lead. AI in Austin is dynamic, has momentum and growing. Most significant indicator of this growth is the fact that many of the startups on the list have raised next round of funding with the total funds closed above $50 Million just in 2017. Many existing startups have had pivots to include NLP, Machine learning and other AI buzz words into their pitches.
AI Startup Focus
One big observation within the AI/Data Sciences startups before I go through the funding and updates. Most of the startups can be classified into two general categories. Enterprise Platform or Vertical Business Focused. Enterprise platforms are also looking at various domains to excel at but they are still focused on the enterprise selling. There are challenges on both sides. The enterprise focus has a tough time showing their own IP versus the vertical business solutions have limited total addressable market.
Funding and Updates
June 2017 was good for both Manoj Saxena led AI startups, CognitiveScale and SparkCognition which had the lions share of the funds raised. SparkCognition raised $32.5 Million Series B led by Verizon Ventures (I believe this is the largest raise in Austin by any company so far in 2017, which got beat by The Zebra $40 Million raise for their Series B as I write this). With its latest customer announcement of Defense Innovation Unit Experimental (DIUx), seems like the funding is being put to good use.
CognitiveScale $15 Million in Series B bringing their total raise to $ 40 MM
Conversable, which provides a SaaS based intelligent conversation platform for enterprises raised $3 Million in seed funding including from the principles. With no formal sales team, they are doing great with marquee names on their customer rooster.
Another messaging startup Message.io which translates chatbots to work across platforms such as slack, FB Messenger, HipChat etc. raised $2.5 Million in their Series A led by Khosla ventures in Nov 2016. The annoucement included a partnership with Microsoft to work with their messaging platform.
Cerebri, which started at UT Austin Longhorn Startup has had a few overhauls and a strong management team is now incharge, raising more than a $1 Million in convertible notes. No wonder they landed some big names as customers and getting their patents process completed.
NarrativeDX closed their Series A led by LiveOak Venture Partners in Austin and HealthX Ventures in May 2017. The cash inflow has helped them grow the team especially on sales and marketing.
Nexd is now Olana with $ 4 Million in new seed funding led by ATX Seed Ventures. CEO Larry Warnock, a well known Austin stalwart, has led the company the last few months and we are seeing the results already.
I am expecting couple of these startups to make public annoucements soon which will be exciting for the whole community. Don’t want to leak anything.
New Additions
Notable among the new additions is Compl.ai, whose product Shep, helps enterprises save money on travel by adopting their travel policy through a browser extension and helping employees make right travel choices.
Authors.me got added to the list since they are bringing Data Sciences to the the entertainment industry by figuring out what books, movies or shows people want to consume.
I met several others through the Capital Factory 100K AI Challenge for first time founders.
Focused on tracking eyes on mobile phones with several applications in healthcare and marketing.
AI/Machine learning with data for sports scout from a founder who himself was a scout. Bring Moneyball to other teams.
I was always impressed by the focus on sales process at Chiron Health. One of their engineers have now taken that and used AI to model that for other companies. I believe this same team is part of Digitial-Nebula, a enterprise AI services company.
Sign language kiosks through machine learning algorithms.
Bringing a little bit of Jarvis from Ironman to Maker Spaces and manufacturers around the world.
Is trying to crack equities trading through deep learning algorithms
$100K Winner
The $ 100K was won by New Knowledge. I have known the team for sometime now. They were mostly services before but have now been able to package their AI for security and propaganda detection, which has a great potential. They also lead the Data4Democracy movement.
A new org backed by some of the big names in Austin popped up joining several other meetups on this topic
All in all, AI/Data Scienes/Machine Learning/Deep Learning startups are gaining momentum and thriving in ATX. With more corporate venture coming, expect it to grow even more.
As always, feedback is welcome
