Week Ending 09.15.19
EYE ON A.I. GETS READERS UP TO DATE ON THE LATEST FUNDING NEWS AND RELATED ISSUES. SUBSCRIBE FOR THE WEEKLY NEWSLETTER.
This week our corporate finance newsletter brings you the details on half a dozen mergers and acquisitions, twelve filings in equity markets, 22 funding rounds, three legal and regulatory developments and 11 executive moves in the world of AI.
Developments this week from companies we have been tracking over the past year include Accenture, McDonald’s, LexinFintech, Element AI, AppZen, Ideanomics, Kintai Therapeutics and UiPath.
See more below ↓
MERGERS AND ACQUISITIONS
Accenture, the New York City-based professional services company, said it acquired Spanish AI company Pragsis Bidoop.
In August, Accenture said it was acquiring Analytics8, the Australian data and analytics firm using AI. It acquired TargetST8 Consulting, which specializes in commercial lending with AI, in October last year.
In July last year Accenture acquired Kogentix, an AI and big data company, and Real Time Analytics Platform, a machine learning and neural networks firm.
A venture capital fund run by the professional services firm acquired a minority stake in Malong Technologies, the Shenzhen, China-based AI company, around the same time.
IYUNO Media Group, the Singapore-based media company using AI, is merging with the UK’s BTI Studios. The merged companies will operate under the IYUNO brand and will be headquartered in London.
Patriot One Technologies, the Burlington, Canada-based company using AI to detect violence, said it acquired AI company XTRACT.
Shopify, the Ottawa, Canada-based e-commerce company, said it acquired logistical robotics firm 6 River Systems.
McDonald’s, the Chicago, Illinois-based fast food giant, said it acquired Apprente, which has developed voice recognition technology the company plans to use in its drive through service.
In March, McDonald’s said it was acquiring AI company Dynamic Yield. Media reports put the size of the acquisition at USD 300m.
Mill Point Capital, the Ottawa, Canada-based private equity firm, said it has completed the acquisition of the services division of Pythian, a data services firm using machine learning.
FILINGS
Peloton Interactive, the New York City-based fitness equipment and services firm using AI, said it is raising as much as USD 1.2bn in an initial public offering of on the Nasdaq of 40m shares at USD 26 to USD 29 each.
Datadog, the New York City-based analytics company using machine learning, said it is raising as much as USD 528m in an initial public offering on the Nasdaq of 24m shares at USD 19 to USD 22 each.
BioNtech, the Mainz, Germany-based company developing cancer treatments using AI, said it is raising a placeholder USD 100m in an initial public offering on the Nasdaq.
Yield10 Bioscience, the Woburn, Massachusetts-based agricultural company using AI, said it is selling 6m shares with warrants, which were valued at $4.74m at the time of the filing.
Cloudflare, the San Francisco, California-based cybersecurity company using machine learning, saw its shares close their first day of trading up 20%. The company raised USD 525m in an initial public offering of 35 million shares at an above range USD 15 each.
Earlier this month the company said it was raising as much as USD 420m from the sale of 35m shares at USD 10 to USD 12 each.
10x Genomics, the Pleasanton, California-based medical research firm, saw its shares close up 35% on their first day of trading on the Nasdaq. The company raised USD 390m in an upsized initial public offering of 10m shares at USD 39 each.
10x Genomics was originally seeking USD 315m from the sale of 9m shares at USD 31 to USD 35 each. The company said it plans to implement robotics into its workflow. Rival Bio-Rad sued the company for patent infringement the day before trading began.
Simbe Robotics, the South San Francisco, California-based retail industry-related robot maker, raised USD 26m, according to a Form D filing. Coverage from the Robotics Business Review is here.
And WeWork filed new governance standards.
Other deals include Inpixon, which raised USD 4.8m from the sale of common and convertible preferred shares with warrants in August, Newgioco and Telemynd.
We end the filings section with a wrap on the IPO market from CNN here, arguing the market is strong but companies with no profit aren’t the popular deals driving momentum.
FUNDING
Anduril Industries, the Orange County, California-based defense-tech startup using AI, raised USD 1b in a funding round led by Andreessen Horowitz, according to a CNBC report. The company was started by Oculus founder Palmer Luckey. Oculus was an AR equipment maker that was sold to Facebook.
LexinFintech, the Shenzhen, China-based consumer finance platform using AI, said it raised USD 300m from the sale of seven-year, 2% convertible notes to private equity group PAG.
In February, LexinFintech hired Shirley Yang as chief human resources officer. In June, it brought venture capitalist Min Xiao onto the board of directors after Yibo Shao resigned.
Element AI, the Montreal, Canada-based AI software developer, said it raised CAD $200m (USD 151.4m) in a Series B round led by Caisse de dépôt et placement du Québec.
In December, Element AI took USD 5m of the about USD 6.3m the Canadian government invested in six companies based in Montreal.
In April, Element AI founder’s JF Gagne wrote on the AI talent shortage here. A review is on the T_HQ website.
Trifacta, the San Francisco, California-based analytics company using AI, said it raised USD 100m from investors that includes the venture capital firms of Japan’s NTT DOCOMO, German car maker BMW and Australian telecoms firm Telstra.
SmartDrive, the San Diego, California-based video analytics company using AI, said it raised USD 90m in a financing led by TPG Sixth Street Partners, a unit of private equity giant TPG. The company focuses on the transportation sector.
McRock Capital, the Toronto, Canada-based venture capital firm, said it raised USD 80m from companies including Cisco and Shell for a fund focused on companies using AI.
Healthy.io, the Tea Aviv, Israel-based company developing machine learning technology, said it raised USD 60m in a Series C led by Corner Ventures.
The company is commercializing technology that helps smartphone cameras run medical tests. The US Federal Drug Administration has approved one of the company’s urinalysis tests for kidney disease. A venture capital firm of South Korea’s Samsung is also a shareholder.
Shape Security, the Santa Clara, California-based fraud detection company using AI, said it raised USD 51m in a financing round led by the UK’s C5 Capital. Venture firms run by JetBlue and HPE are also shareholders.
AppZen, the San Jose, California-based business services firm using AI, said it raised USD 50m in Series C funding led by Coatue Management. In November, the company raised USD 25m in a Series B led by Lightspeed Venture Partners, which also participated in the current round. A blog post from the company on the round is here.
Lacework, the Mountain View, California-based cybersecurity platform using AI, said it raised USD 42m in a funding round led by Sutter Hill Ventures and Liberty Ventures. The company also hired a new president. See People section
Insilico Medicine, the Hong Kong-based drug discovery startup using AI, raised USD 37m in Series B funding led by Qiming Venture Partners, according to a FierceBiotech report.
Voyage, the Palo Alto, California-based self-driving car company, said it raised USD 31m in Series B funding led by Franklin Templeton. Venture funds run by Jaguar and Chevron also participated.
Syte, the Tel Aviv, Israel-based company using visual AI technology in marketing, said it raised USD 21.5m in Series B funding led by tech-focused venture capital firm Viola Ventures
Explorium, the San Francisco, California-based data platform for machine learning use, said it raised USD 19m in funding led by Emerge and Zeev Ventures.
Swiftly, the Millbrae, California-based supermarket software developer using machine learning, raised USD 15.6m in seed funding that included Novel Private Equity and Mendacre, according to a GeekWire report.
Numerated, the Boston, Massachusetts-based banking services firm using AI, said it raised USD 15m from a Series B round led by Patriot Financial Partners.
Patch Homes, the San Francisco, California-based home finance company using machine learning, said it raised USD 5m in a Series A funding round led by Union Square Ventures.
Other deals include Boulder AI, SandStar, Kenmei Technologies and Shift5.
And AR startup Daqri is shutting down, according to a TechCrunch report.
LEGAL AND REGULATORY
The US National Science and Technology Council said the federal government is budgeting about USD 1bn for non-defense AI in 2020.
The US Air Force, released a five-point plan on developing AI in its operations.
GE Healthcare said the US Food and Drug Administration has approved a mobile X-ray device it developed that uses AI.
PEOPLE
DXC Technology, the Tysons, Virginia-based IT services company using AI, said it hired former Accenture executive Mike Salvino as president and CEO. Mike Lawrie, who had held the CEO role retired and will step down as chairman of the board of directors at the end of the year.
Ideanomics , the New York City-based AI company formerly called Seven Stars Cloud, said it hired Conor McCarthy as CFO.
In May, the company took control of Delaware Board of Trade Holdings after acquiring an additional 71.7% of the financial services firm. The company now holds a 98.4% stake.
In April, Ideanomics said it was acquiring a 51% stake in Malaysia's Tree Motion and a 11% stake in its parent, Tree Manufacturing. The parent is an electric vehicle maker and the Tree Motion subsidiary is the company’s sales arm.
Ideanomics also acquired SolidOpinion, the marketing firm using AI, in March. In September last year Ideanomics acquired FinTalk, the secure messaging service, and said it was taking a 10% stake in Asia Times, the news service. Ideanomics also said it entered into a share swap with Liberty Biopharma, which changed its name to HooXi. The specific details of the swap were not disclosed.
Lacework, the Mountain View, California-based cybersecurity platform using AI, said it hired Andy Byron as president. The company also raised USD 43m. See Funding section
Zilliant, the Austin, Texas-based marketing company using AI, said it hired former Dun & Bradstreet executive Lindsay Duran as chief marketing officer.
BlackThorn Therapeutics, the San
Francisco, California-based mental health analytics company using AI, said it hired Monique Levy as chief strategy officer.
UPL, the Cary, North Carolina-based food company using AI, said it hired Adrian Percy as chief technology officer for its crop protection business.
Kintai Therapeutics, the Cambridge, Massachusetts-based drug developer using AI, said it hired Mark Nuttall, as chief business officer. In April, the company hired former GlaxoSmithKline executive Paul-Peter Tak as president and CEO. The company developed out of Flagship Pioneering, the life sciences corporate incubator.
QC Ware, the Palo Alto, California-based quantum computing software developer, said it hired Scott Aaronson as chief scientific adviser, Wim van Dam as head of quantum algorithms US and Lordanis Kerenidis as head of quantum algorithms international.
HighRadius, the Houston, Texas-based fintech company using AI, said it hired Jon Keating as vice president and general manager, Europe, Middle East and Africa. In March, the company hired Natalie Fedie as vice president of consumer success.
MaritzCX, the Lehi, Utah-based healthcare analytics company using AI, said it hired Jason Macedonia as vice president, healthcare & patient experience and Dave Beaulieu as executive vice president global healthcare division.
UiPath, the New York City-based robotics software maker, said it hired Chris Townsend as vice president of federal sales.
In May, the company raised USD 568m in a Series D led by Coatue, the technology-focused hedge fund. It raised USD 225m in a Series C led by CapitalG and Sequoia Capital in September last year.