Intel Capital Invests $132M in Tech Startups

Article By : Brian Santo

Intel Corp.'s funding arm announced $132 million in investments in a set of startups that are concerned with business data and analytics...

Intel Capital announced another round of investment in technology startups, this time distributing $132 million among 11 technology startups. The company said that this round it “focused on artificial intelligence (AI), autonomous computing, and IC design,” but the word “focus” seems to be over-selling it. If there’s a theme to be found in the company’s picks this year, it’s automated and autonomous analytics tools for business applications.

This round of companies included 7 from the United States (in fact, all 7 are in California), 3 from China, and 1 from Israel.

Intel Capital’s marketeers can perhaps be forgiven for thinking that “automated and autonomous analytics tools for business applications” is just not sexy enough as a topic — or perhaps it’s simply too much of a mouthful. To be fair, we gave up trying to cram it into our headline.

This year the cluster of themed investments is Anodot, Astera Labs, and Retrace. Intel Capital describes Anodot as a company that uses machine learning (ML) to perform autonomous business monitoring. Hypersonix has developed an autonomous, AI-based analytics platform designed for consumer industries such as retail, restaurants, hospitality, and ecommerce. Retrace has developed a predictive analytics platform that also uses AI in real-time data to improve dental decision-making.

Yes, they all use AI, but since for all of them AI technology is a tool, not the final product, they are not AI companies for the purpose of this discussion.

“Decisioning” is now being used in place of real words
Anodot monitors a variety of business metrics that include everything from financial performance numbers to social media responses, and provides real-time, contextual alerts to “catch incidents that impact revenue and costs.” Examples of “incidents” include drops in success rate, customer incidents, app performance and other business metrics. The company’s customers include Atlassian, T-Mobile, UPS, Nordstrom and Pandora.

Anodot, founded in 2014, is considered a late-stage venture, most recently having concluded Series C of fundraising in mid-April. Intel Capital was the lead in that round, which netted Anodot a total of $35 million.

Hypersonix has a business approach that seems similar — it helps with “decisioning.” Founded in 2018, it too has built a platform that pulls in and analyzes a variety of metrics, also ranging in type and from disparate sources, from regional business performance numbers to web traffic statistics, for example. It just closed its Series A round of funding at the beginning of May which netted Hypersonix $11.5 million. The round had four investors led by Intel Capital.

Retrace is yet another company that helps with “decisioning” — dental decisioning. Retrace’s system basically does with dental records what Anodot and Hypersonix do with business metrics. Retrace makes a big deal of the fact that (for some reason it doesn’t get into) hackers have been going after visual dental records (x-rays and the like), trying to deliberately alter them to confuse AI systems that evaluate the data. Retrace says its system is designed to be secure against such cyberattacks.

There’s no financial trace of the company (Anodot and Hypersonix are listed in Crunchbase, for example, while Retrace is not), but it did set up a GoFundMe page two months ago that as of this writing had attracted zero dollars.

Silicon-oriented startups
Another noteworthy investment is Astera Labs, a fabless semiconductor company that develops “purpose-built connectivity solutions for data-centric systems to remove performance bottlenecks in compute-intensive workloads such as artificial intelligence and machine learning.” Intel Capital goes on to say that Astera has developed “system-aware ICs, boards and services to enable robust connectivity for PCI Express (PCIe) and Compute Express Link (CXL) solutions.”

The company has developed what it calls a retimer that can be used in data centers to enable PCIe 4.0 and 5.0 handle AI workloads faster.

Astera was founded in 2017. It just closed its Series B funding at the end of April, in which Intel Capital participated. The company’s total funding to date from all investors is $6.4 million.

Another notable 2020 Intel Capital investment is MemVerge, a software company “founded on the vision that every application should run in memory.” That would necessitate what the company calls giant, petabyte-scale “pools” of a combination of DRAM and persistent memory. MemVerge has developed software it calls the Memory Machine, which essentially manages these pools.

MemVerge’s claims its Big Memory software “lowers the cost of memory, allows it to scale out, and makes it highly available with memory data services such as ZeroIO snapshot, memory replication, and lightning-fast recovery.”For Intel Capital, this investment is basically a play to increase the utility and attractiveness of Intel’s Optane memory.

MemVerge closed its series A in 2019; Intel Capital was not among the investors in that round. Where many of Intel Capital’s 2020 investments are already a matter of public record, its investment in MemVerge is apparently not public yet.

The other companies that Intel Capital invested in are:

  • Axonne, which specializes in Ethernet connectivity solutions for the automotive market;
  • KFBIO, a biotech company that builds digital pathology systems meant to be upgrades to traditional microscopes;
  • Lilt, which has developed AI-based language translation software and services;
  • ProPlus Electronics, an electronic design automation (EDA) company in China that specializes in advanced device modeling and fast circuit simulation solutions;
  • Spectrum Materials, which Intel Capital described as a high-purity specialty gas and material supplier for semiconductor fabs; and
  • Xsight Labs, which develops chipsets designed to accelerate data center workloads such as machine learning, data analytics and disaggregated storage.

Intel Capital has developed a habit of investing in one or more clusters of three or four companies each, all attacking similar challenges, though sometimes from different angles. One year Intel’s capital investment arm backed a cluster of companies involved in sports, another year there was a group in biomedicine, and there have been a couple of years in which there were clusters in AI, for example.

The marketing materials of this year’s business analytics cluster (Anodot, Hypersonix, Retrace) are nearly parodies of corporate-speak. Intel Capital doesn’t help by describing the technology of every single company it invests in as “disruptive,” which is hyperbole in most if not all cases. That said, Intel Capital looks hard for innovation and it generally finds it.

Intel Capital said it invested $466 million in 36 new investments and 35 follow-on investments in 2019. It reported that it led 72% of its deals and had 22 successful exits.

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