Category Archives: Mergers & Acquisitions

The Race For AI: Google, Intel, Apple In A Rush To Grab Artificial Intelligence Startups

 


Source: cbinsights.com

Research Briefs from cbinsights.com – February 27, 2018

Around 42% of the AI companies acquired since 2013 have had VC backing.

Big corporations across every industry, from retail to agriculture, are trying to integrate machine learning into their products. At the same time, there is an acute shortage of AI talent.

A combination of these factors is fueling a heated race to scoop up top AI startups, many of which are still in their early stages of research and funding.

Nearly 120 AI startups exited for the first time last year, of which 115 were acquired.

Already this year, there have been 8 acquisitions. Amazon acquired AI cybersecurity startup Sqrrl. Oracle followed suit by acquiring cybersecurity company Zenedge.

AI startups are acquisition targets not only for big tech companies, but also for traditional insurance, retail, and healthcare incumbents.

In one of the largest M&A deals in artificial intelligence, Roche Holding acquired NY-based Flatiron Health for $1.9B in Feb’18. The only other disclosed $1B+ AI exit was Ford’s acquisition of auto tech startup Argo AI in 2017.

Google is the top acquirer of AI startups, with 14 acquisitions under its belt (excluding Kaggle, a data science community that hosts machine learning competitions).

The timeline below shows the M&A activity of corporations that have made 4 or more acquisitions since 2010. (Note: The exact dates for Apple’s Novauris and Amazon’s Orbeus acquisitions are not known. They are plotted on approximate dates of acquisition.)

In 2013, Google picked up deep learning and neural network startup DNNresearch from the computer science department at the University of Toronto. This acquisition reportedly helped Google make major upgrades to its image search feature.

In 2014 Google acquired British company DeepMind Technologies for some $600M (Google’s DeepMind program recently beat a human world champion in the board game “Go”).

It also recently acquired conversational commerce platform Banter. Google previously made another major acquisition in natural language processing — startup API.ai — in 2016, powering some of Google Assistant’s capabilities.

Apple is close behind with 13 acquisitions.

Apple was one of the earliest players in the space. It acquired Siri in 2010, popularizing AI assistants. For comparison, the technology behind Amazon’s Alexa can be tied back to the startup Evi Technologies, which Amazon acquired in 2013.

Apple’s M&A activity slowed down for several years following the Siri acquisition, before picking up in 2016. Apple has been rather secretive about how it plans to integrate the AI startups it has acquired into its products. Its most recent acquisition was Pop Up Archive, which could be a potential addition to iTunes. Prior to the acquisition, the startup was developing tools to search and organize audio files. It used machine learning to convert speech to text, and crowdsourced the task of fixing transcription errors.

A notable exception in the big-tech-dominated top acquirers chart above is the Meltwater Group, a social media monitoring company. It is also the only private company on the chart.

Meltwater is strategically using AI to monitor digital media and analyze brand sentiment and competitor activity.

AI acquisitions (2012-2017) YTD
Company Country M&A Date
Harvest.ai United States 1/9/2017
Angel.ai United States 9/20/2016
Orbeus United States 10/1/2015
Evi Technologies United Kingdom 4/17/2013
Sqrrl United States 1/23/2018
Siri United States 4/9/2010
SensoMotoric Germany 6/27/2017
Regaind France 9/29/2017
Init.ai United States 10/5/2017
Pop Up Archive United States 12/5/2017
Lattice United States 5/15/2017
RealFace Israel 2/20/2017
tuplejump India 9/22/2016
Turi United States 8/5/2016
Emotient United States 1/7/2016
Perceptio United States 10/6/2015
Vocal IQ United Kingdom 10/2/2015
Novauris Technolgies United Kingdom 4/3/2014
Ozlo United States 7/31/2017
Zurich Eye Switzerland 11/10/2016
Masquerade Technologies Belarus 3/9/2016
Wit.ai United States 1/5/2015
Mobile Technologies United States 8/13/2013
Face.com United States 5/29/2012
AIMatter Belarus 8/16/2017
Banter United States 11/1/2017
Halli Labs India 7/12/2017
Api.ai United States 9/19/2016
Moodstocks France 7/6/2016
Timeful United States 5/4/2015
Granata Decision Systems Canada 1/23/2015
Jetpac United States 8/16/2014
Emu United States 8/6/2014
DeepMind Technologies United Kingdom 1/27/2014
DNNresearch Canada 3/13/2013
CleverSense United States  12/14/2011
Vision Factory United Kingdom 10/23/2014
Dark Blue Labs United Kingdom 10/23/2014
Movidius United States 9/6/2016
Nervana Systems United States 8/9/2016
Itseez United States 5/27/2016
Saffron Technology United States 10/26/2015
Indisys Spain 9/13/2013
Cosmify United States 8/15/2017
Algo Norway 8/29/2017
Wrapidity United Kingdom 2/21/2017
Encore Alert United States 3/29/2016
OCULUSai Sweden 3/18/2013
Maluuba Canada 1/13/2017
Genee United States 8/22/2016
SwiftKey United Kingdom 2/19/2016
Equivio Israel 1/20/2015
Netbreeze Switzerland 3/20/2013
MetaMind United States 4/4/2016
PredictionIO United States 2/19/2016
MinHash United States 12/14/2015
Tempo AI United States 5/29/2015
Magic Pony United Kingdom 6/20/2016
Whetlab United States 6/17/2015
TellApart United States 4/28/2015
Madbits United States 7/30/2014

 

Below you can see the timeline as of last publication in July 2017. In the previous timeline, we included all acquirers with at least 2 AI acquisitions.

 

The timeline as of 10/16 is included below.

race_for_AI_12012016

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