These AI Startups Raised More Than $300 Million in Funding. Here is What They Do with Machine Learning

In recent years, artificial intelligence became a honeypot for investors. This technology finds its use in different areas and industries which discovers its potential to yield considerable income. On that account, industrial giants open their wallets to acquire promising AI startups.

AI startup acquisition race

For the last five years, Apple and Google have acquired 27 companies that offer AI innovations. Other tech industry giants including Facebook and Amazon are lagging behind yet.  Siri joined the company with the logo of a bitten apple in 2010 and became a jumping-off point. The race began in 2011 when Google purchased a project of local recommendations called CleverSense. After that Facebook forked out $100 millions for the face recognition platform in 2012. Such renowned names as Amazon, Microsoft, SalesForce, and others also follow the trend.

Last year, there were made 115 AI startup acquisitions in total. The fresh names include Body Labs (3D body modeling with AI) and (cybersecurity company) acquired by Amazon, RealFace (facial recognition and cybersecurity project) acquired by Apple, Kaggle (data science and machine learning) and AIMatter (neural network platform for image processing) acquired by Google. However, all these are minnows in terms of total equity funding amount. None of them exceeds $100M. Lattice Data is an exception. Apple paid $200 million for this company. They deal with data structuring with an AI-based inference engine. High dollars are inherent to the AI sector.

How much is the fish?

For the past couple of years, there have been almost 200 AI startup acquisitions. It’s hard to say how much money was paid because not all deals are disclosed. However, this figure has definitely risen beyond ten-digit number because the only Ford’s acquisition of Argo AI is over . According to the CBInsights’ report, the investment amount in projects that use AI algorithms in 2017 hit $15 billion. Moreover, the better part of them (48%) falls on China rather than the USA. The forecasts for the coming years look marvelous –  Forrester Research predicts over $1 trillion investments in businesses that use machine learning and artificial intelligence within a couple of years. Chatbots, IoT, Big Data, virtual and augmented reality will grab the biggest piece of the pie.

$300 million and above

Now, let’s draw our attention to AI startups that raised more than $300M in funding in the last years. Our pick is international since it consists of representatives of China, the USA, and Germany.

SenseTime – $1.6B

This Chinese company focuses on the development of computer vision and facial recognition algorithms using deep learning technologies. SenseTime is not the biggest AI startup in China and loses to a recommendation system Toutiao, which raised a total of $3.1B. SenseTime has built a number of algorithms that are used for weather forecasting, image processing, identity verification, personalized shopping, public surveillance, etc.

Argo AI – $1B

Unlike SenseTime, Argo AI can boast the title of the biggest AI startup in the USA. In 2017, Ford Motor Company realized that it needs a new approach to catch up with companies that develop autonomous vehicles, and invested one billion dollars in this company to develop a virtual driver system. It is planned that we will see the result of collaboration between Argo AI and one of the biggest carmakers in 2021 with the launch of their first self-driving vehicle.

UBTech Robotics – $940M

Back to China. UBTech Robotics has raised 940 million US dollars from nine investors. As you can judge from the name, the startup deals with AI to design and produce humanoid robots. Machine learning algorithms are used in their products for voice and facial recognition (for example, in their robot Alpha 1 Pro). UBTech Robotics has big plans for the near future including, but not limited to the launch of a new generation of robots in 2021.

Dataminr – $577M

It is the oldest AI startup on our list. Though Dataminr was founded in 2009, it managed to raise $577 million quite recently – in 2018. The startup represents a real-time information discovery solution based on machine learning innovation. In other words, Dataminr analyzes big data from different sectors (finance, news, security, etc.) and detects the signals of critical events and consequences which allows its clients to stay ahead of the game.

Kreditech – approx. $500M

We decided to sum up our pick with one of the biggest AI startups in Germany. Kreditech is a representative of machine learning implementation in the financial sector. Similar to many fintech companies, it leverages ML algorithms to evaluate the creditworthiness of unbanked customers. Though the company was founded in 2012, it managed to jump over $300 million in 2016. The total number of Kreditech investors is 26 so far.

Money doesn’t buy success

Startup launch is a risky journey. Each startup founder dreams about laurels of famous winners like Jeff Bezos (Amazon) or Daniel Ek (Spotify). However, they would tell you that lack of money is not the only challenge you can face during the journey. You may burn out, lose focus of your business, trip over the poor marketing, back the wrong team, and bump up against another dozen obstacles. And the first thing a startup founder needs to cope with is to fully realize a need for his/her idea or project on the market. It is really hard to create a solution to a real problem. If the journey were not thorny, everyone would go into artificial intelligence, and we would have an AI consulting company around each corner.

There is no recipe to achieve success with your startup. Nevertheless, the first thing to do is to realize that AI is not an ordinary technology. Just like a wheel that gave birth to the development of mechanics, artificial intelligence is a game-changer in the modern society. It entails huge transformations in the accustomed state of things. If you are sure that your idea is revolutionary, then go ahead.