Analyzing the AI Investment Landscape TM A data-driven look at financing trends, investors, and hot markets within the INSIGHTS CB artificial intelligence ecosystem TM INSIGHTS CB About CB Insights

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cbinsights.com 2 Table of Contents

Funding and Deals

Deep Interest in AI: New High in Deals to Artificial Intelligence Startups in Q4’15 5

Corporates in AI

Bloomberg and Samsung Among the Corporates Betting Big on AI Startups 11

AI in Healthcare

32 Artificial Intelligence Startups in Healthcare 17

Early-Stage Startups to Watch

14 Early-Stage Virtual Assistants to Watch 24

10 Early-Stage AI Startups to Watch 27

Robotics

Funding and Deal Activity to Robotics See New Highs in 2015 31

Seven Grant-Funded Robotics Companies to Watch in the US 37

Here Are 11 Robotics Startups to be Afraid Of 41

cbinsights.com 3 Funding and Deals

cbinsights.com 4 February 4, 2016

Deep Interest In AI: New High In Deals To Artificial Intelligence Startups In Q4’15

Deal activity almost doubled in the last quarter. Data Collective, Bloomberg Beta and Khosla Ventures are the most active investors in AI startups.

Advancements in AI were recently spotlighted by AlphaGo, a computer program developed by Google’s DeepMind team. The program — which relies on decision-making algorithms and neural networks — defeated a human European champion at the board game Go in a feat previously believed to be years away.

On the investor side, of Breyer Capital has said AI will deliver massive returns for investors betting on applications for industries including healthcare and entertainment.

With this in mind, we used CB Insights’ database to look at funding to artificial intelligence startups since 2010. Our artificial intelligence category covers startups primarily focused on developing AI, across areas including image processing, natural language processing, machine learning, deep learning, and predictive APIs, among other core applications.

We found that AI startups have raised an aggregate $967M in funding since 2010, with investments going to companies in 13 separate countries and 10 industry categories, including business intelligence, e-commerce, and healthcare.

cbinsights.com 5 Annual deals and dollars

Funding in the AI sector has multiplied nearly sevenfold, from $45M in 2010 to $310M in 2015.

Some of largest funding rounds were raised by California-based startups Sentient Technologies ($103.5M Series C in 2014) and Ayasdi ($55M Series C in 2015).

The year 2014 saw the highest number of deals and investments in AI, with $394M across 60 deals.

Three AI-focused companies have already raised funds in 2016, with Ontario-based Maluuba, which was previously seed funded by Samsung Ventures, raising a $6.2M Series A from other investors. The other two are United Kingdom’s Seldon, and US-based Kitt.ai.

Quarterly trends

After deals dropped by more than 35% from Q3’14 to Q3’15, activity rose rapidly once more and reached an all-time quarterly high of 19 deals in Q4’15. In that quarter, H2O.ai raised the largest round — a $20M in Series B — followed by RapidMiner’s $16M Series C.

Q4’14 had an all-time quarterly funding high of $201M, more than half of which was from Sentient Technologies’ Series C round.

cbinsights.com 6 The peak in funding in Q1’14 was driven by the $40M Series B round raised by Vicarious Systems. Q1’15 saw $121M raised from 12 deals to companies including Ayasdi, RapidMiner, and Viv Labs.

Deal share by stage

A wide majority of deals to artificial intelligence companies from 2010 to 2015 involved early- stage startups, with seed deals dominating, accounting for 50% of overall activity in 2015, while Series A took 19% of deals that year. Over 60 AI companies received seed/angel funding during these six years.

Mid-stage deals have begun to take more deal share recently, with Series B and Series C deals combining for a 20% share in both 2013 and 2014, but a 26% share in 2015. Series C deals climbed from a 7% share to a 15% share from 2014 to 2015.

cbinsights.com 7 Dollar share by stage

Dollar share in AI funding has swung from early-stage to mid-stage investments.

The lion’s share of investments – 93% — went to early-stage startups in 2012, consistent with the peak in early-stage deal share that year. Fifteen startups on our list raised seed/angel or Series A rounds that year, with the largest being Vicarious Systems’ $15M Series A.

From 2013 to 2015, over 50% of dollars went to startups raising Series B or C rounds, including Sentient Technologies, Ayasdi, Vicarious Systems, Digital Reasoning Systems, Nervana Systems, and H2O.ai. Mid-stage (Series B and C) dollar share peaked at 66% in 2015.

Most well-funded companies

Sentient Technologies, which recently launched an online AI sales associate, Visual Filter, with SHOES.COM, is the most well-funded AI startup on the list.

It is followed by California-based Ayasdi, backed by investors including Khosla Ventures, Citi Ventures and GE Ventures.

The top 10 companies on the list below are developing products ranging from the next generation of AI assistants to advanced machine-learning tools.

cbinsights.com 8 Most active investors

The top spot went to California-based VC fund, Data Collective. The firm has backed AI startups including Vicarious Systems, Scaled Inference, SigOpt, and New Mexico-based Descartes Labs.

Bloomberg Beta, which launched in 2013, was tied for second spot with Khosla Ventures. The former’s investments include Diffbot and Context Relevant, while the latter invested in startups including Atomwise, MetaMind, and Scaled Inference.

cbinsights.com 9 Corporates in AI

cbinsights.com 10 February 12, 2016

Bloomberg And Samsung Among The Corporates Betting Big On AI Startups

Corporate activity in AI slowed in 2015 after reaching a six- year high in 2014. Major players include Bloomberg Beta and Samsung Ventures.

VC-backed artificial intelligence startups, which have seen a sevenfold increase in funding since 2010, have also seen corporations take a greater interest.

While acquisitions of VC-backed AI startups by major corporations — including Vocal IQ by Apple, Wit.ai by , and DeepMind by Google — have been in the spotlight recently, corporate involvement in investing in these startups has also grown. Deals to AI startups involving corporates saw a 15x increase between 2010 and 2015.

Just in the last quarter, companies including H2O.ai (Transamerica Ventures and Capital One Ventures), Gridspace (Wells Fargo Startup Accelerator) and Mobvoi (Google) saw backing from prominent corporates.

Our artificial intelligence category covers startups primarily focused on developing AI, across areas including image processing, natural language processing, machine learning, deep learning, and predictive APIs, among other core applications.

Out of the companies on the list, Expect Labs had the most corporate backers, with investments from Google Ventures, Samsung Ventures, Intel Capital, In-Q-Tel, Telefonica Ventures, and Liberty Global Ventures. The -based startup is working on intelligent voice interfaces.

cbinsights.com 11 Two other startups also had more than three corporate backers: New York-based Clarifai (backed by NVIDIA, Qualcomm Ventures, Google Ventures, and LDV capital) and California’s Api.ai (backed by Intel Capital, Motorola Solutions , SAIC Capital and Alpine Technology Fund).

Corporate-backed deals and dollars

Funding from deals involving corporations skyrocketed in 2014, when startups netted $230M in 21 such deals.

That year, Intel Capital backed Api.ai in its Series A and B rounds (Motorola Solutions Venture Capital also joined in the Series B); invested in Scaled Inference; and Google Ventures backed Clarifai in a seed round (Qualcomm Ventures joined in a second seed round to Clarifai in that year). Google Ventures, now known as GV, also backed Luminoso Technologies in a $6.5M Series A round in 2014.

But the spike in 2014 AI funding can be attributed mainly to Sentient Technologies’ $103.5M Series C mega round, which saw participation from corporate India’s Tata Communications.

Corporate-backed deals dropped 29% in 2015, but was still higher than every other year except 2014.

cbinsights.com 12 Quarterly trends

After very low deal activity in the first three quarters, the pace picked up in the Q4’15, with number of deals growing and almost equaling that of Q4’14 and Q3’14 each of which saw 8 deals. Corporate activity during Q4’15 was spotlighted by Google Inc.’s interest in China with its large — reportedly in the “tens of millions of dollars” — investment in artificial intelligence startup Mobvoi.

Corporate deal and dollar share by stage

The majority of corporate participation during the 2010 to 2015 period — 65% — was in early-stage deals. The 4% late-stage deal share includes two Series F financings raised by Nexidia, which is backed by BlueCross BlueShield Venture Partners. The “other” category includes Digital Reasoning Systems‘ corporate minority round, funded by HCA Healthcare (Hospital Corporation of America).

cbinsights.com 13 Dollar share

Though early-stage deal share was higher, the most dollars (69%) went into mid-stage deals with corporate participation. These include Ayasdi’s $30M Series B round, backed by GE Ventures and Citi Ventures, and the previously-mentioned Sentient Technologies’ $103.5M Series C.

cbinsights.com 14 Most active corporate investors

More than 45 corporations and corporate venture capital firms have invested in artificial intelligence startups since 2010.

Bloomberg Beta, which was launched in 2013, is one of the most active investors in this sector, funding companies like Howdy, Domino Data Lab, Context Relevant, and Diffbot. Last year, Samsung Ventures invested in Vicarious Systems — the third-most well funded company on our list. Samsung’s other investments in AI include Idibon, Expect Labs, and Winston. The venture capital arm of Japan’s internet services company, Rakuten, invested in visual technology startup ViSenze and Seattle-based Algorithmia.

Below are some corporate investors actively funding AI startups.

cbinsights.com 15 AI in Healthcare

cbinsights.com 16 February 25, 2016

From Virtual Nurses To Drug Discovery: 32 Artificial Intelligence Startups In Healthcare

The 32 startups on the list, many of them in machine learning/deep learning, have raised more than $530M in aggregate. Khosla Ventures backs five of the companies. we identified 32 companies that are already applying machine learning techniques and predictive analytics to reduce drug discovery times, provide virtual assistance to patients, and diagnose ailments by processing medical images, among other things.

The 32 startups on the list have raised more than $530M in aggregate funding.

This year, New York-based AiCure raised $12.3M in Series A funding and National Science Foundation-grantee Cloud Pharmaceuticals raised a $350K round from undisclosed investors. London-based health services startup, Babylon Health, raised a $25M Series A round from investors including Google-owned DeepMind Technologies and Hoxton Ventures. The company will reportedly roll out a Siri-like voice recognition interface this year.

Smart money investor Khosla Ventures has backed 5 of the companies on the list: California-based Ginger.io, which focuses on patients with depression and anxiety; healthcare analytics platform Lumiata; California-based MetaMind and Israel’s Zebra Medical Vision, both of which apply AI to medical imaging; as well as drug discovery startup Atomwise.

cbinsights.com 17 The most well-funded startup on the list, Colorado-based health optimization platform WellTok, has collaborated with IBM’s Watson to provide personalized healthcare guidance to consumers.

Patient-monitoring startup, California-based Sense.ly, developed a virtual nursing assistant, Molly, to follow up with patients post-discharge. The company claims Molly gives clinicians “20% of their day back.” In drug discovery, startups like Atomwise, Numerate, and twoXAR are using machine learning to reduce the amount of time and capital involved in uncovering new therapies.

The market map below breaks down the companies by specific categories.

Most of the startups are VC-backed and a few of have received backing from accelerators or private equity firms.

cbinsights.com 18 cbinsights.com 19 cbinsights.com 20 cbinsights.com 21 cbinsights.com 22 Early-Stage Startups to Watch

cbinsights.com 23 March 2, 2016

From Scheduling Meetings To Health Advice: 14 Early-Stage Virtual Assistant Startups To Watch

The companies have raised more than $65M in aggregate and are active in areas as diverse as comparison shopping and healthcare.

The competition among Siri, Cortana, Google Now, Alexa, and Facebook’s (still in its early stages), has kept the spotlight on virtual assistants for the last couple of years. The assistants and the technologies that power them, including machine learning and natural-language processing, have piqued the interest of venture capitalists as well.

We’ve identified 14 startups working in the virtual assistant space or providing underlying technology to power digital assistants that either received either Series A or seed/angel funds since 2015. None of the companies on the list have raised a Series B round yet. These startups have raised over $65M in aggregate and are focused on over 10 industry categories, including health & wellness, HR & workplace management, customer relationship management, comparison shopping, and healthcare.

The most well-funded startup on our list is London-based Babylon Health. As we mentioned in our research on artificial intelligence in healthcare, the company raised a $25M Series A round from investors including Google-owned DeepMind Technologies and Hoxton Ventures, and will reportedly roll out a Siri-like voice interface this year that will give users health advice.

cbinsights.com 24 x.ai has been in the news for its personal e-mail assistant, which the company has named Amy Ingram. Describing the AI-driven assistant, the Boston Herald wrote that “she’s prompt, cordial, concise, clear — and not at all human.” The company is backed by investors including FirstMark Capital and Softbank Capital.

Four AI-based virtual assistant startups in India are among the 14 on our list: speech analytics company Uniphore Software Systems, e-commerce startup Voodoo Technologies, research assistant Arya.ai, and cab booking service Niki.ai.

cbinsights.com 25 cbinsights.com 26 February 8, 2016

From Intelligent Diagnostics To The Next Siri: 10 Early-Stage AI Startups to Watch

We used our Mosaic algorithm to identify promising startups advancing artificial intelligence, including companies working on deep learning for medical diagnosis and AI-based personal scheduling assistants.

Funding to artificial intelligence startups totaled $310M in 2015, with 33% of dollars and 69% of deals going to early-stage (seed/angel or Series A) AI companies in that year.

With the help of our Mosaic algorithm, which tracks the health of private companies, we identified 10 early-stage startups to watch in 2016. All the companies on the list have either raised Series A or seed/angel funds since January 2015. None of them have yet raised a Series B.

New York-based stealth company ASAPP, which raised a $7.6M seed from angel investor David Strohm, has created an AI-powered asynchronous messaging platform, according to the Harvard Startup Career Fair site. Canada’s Maluuba, which raised a Series A round last month, is working on technologies to improve machine reading and natural language processing.

Other companies on the list are developing technologies ranging from advanced medical diagnosis using deep learning to AI-based personal scheduling assistants.

cbinsights.com 27 cbinsights.com 28 cbinsights.com 29 Robotics

cbinsights.com 30 March 23, 2016

Robots R’ Us: Funding And Deal Activity To Robotics See New Highs In 2015

Investors are piling into robotics. Funding to the category, excluding drones, was up 115% in 2015. Innovation Works, Intel Capital and High-Tech Grunderfonds were the most active VC investors.

Funding to private robotics companies nearly doubled in 2015, reaching a record high in deals and dollars.

Already in 2016 (through 3/21/16), nearly 15 companies, including Restoration Robotics, Savioke, and 5D Robotics, have raised an aggregate of $89M in funding across 15 deals.

Our robotics category excludes drones, but includes robotics companies focused on process and manufacturing automation, agricultural automation, surgical applications, and personal/social robots. Together, the companies have raised more than $1.4B in cumulative funding since 2011.

Our analysis includes all equity funding rounds and convertible notes, but excludes debt

cbinsights.com 31 Global yearly financing history

Deals in robotics nearly doubled from 45 in 2014 to 83 in 2015. The investment growth rate during this period was 115%, compared 55% the previous year.

The highest funded round in 2015 was a $150M growth equity round raised by Auris Surgical Robotics, which is backed by investors including Lux Capital, Mithril Capital Management and NaviMed Capital.

Except for a 2013 slowdown in the rate of growth, robotics deals have been nearly doubling year-over-year.

Global quarterly financing history

Q2’15 saw the peak in deal count. Over 20 companies across 7 countries raised financing. That quarter, Beijing-based Ninebot raised an $80M round, backed by investors including Sequoia Capital China and Shunwei Capital Partners.

The following quarter, Q3’15, saw an all-time high in funding, driven by the previously- mentioned mega-round raised by California-based Auris Surgical Robotics.

cbinsights.com 32 Funding dropped by almost 74% in the last quarter of 2015 on a quarter-on-quarter basis, though deal activity remained nearly the same as in Q3’15.

So far in Q1’16, funding has recovered from the slowdown in the previous quarter, but the numbers are still not on pace to equal the funding levels seen in the first three quarters of 2015.

Deal share by stage

Over 60 companies raised seed/angel funds and 20 companies raised Series A rounds over the last 5 years. Early-stage deal share dominated in all five years, except 2011, when mid- stage (Series B and C) rounds accounted for 54% of deal share.

Late-stage deal shares (Series D and E+) have been low across the years, reaching a five-year low of 6% in 2015.

The “other” category includes convertible notes, corporate minority rounds, and equity rounds not attributed to a particular stage.

cbinsights.com 33 Dollar share by stage

Though early-stage deals took higher deal share, late- and mid-stage rounds dominated in dollar share. Some of the highest-funded late-stage deals include a $45M Series E round raised by Liquid Robotics, a $45M Series F round raised by Sphero, and a series F round of $41M raised by 4Moms.

cbinsights.com 34 Most active VC investors

Pittsburgh-based Innovation Works was the most active VC investor in robotics, having invested in over 5 unique companies. Just in the last year, the VC seed-funded HEBI Robotics, Titan Robotics, Capsen Robotics, and IAM Robotics.

Intel Capital and Germany-based seed-stage investor High-Tech Grunderfonds were tied for second place. Since January 2015, the former has backed companies including Savioke, PraFly, and Ninebot, while the latter has invested in REVOBOTIK and Bionic Robotics.

Most well-funded robotics compainies

California-based stealth mode robotics startups, Auris Surgical Robots, is the most well-funded company on the list. Backed by investors including Lux Capital, Mithril Capital Management, NaviMed Capital, and Highland Capital Partners. Auris is developing a microsurgical robotic system for ophthalmic surgeries.

The second-most well-funded company is consumer robotics and AI company, Anki, backed by investors including Andreessen Horowitz, Index Ventures, JPMorgan Chase, and Two Sigma Ventures.

The rankings are based on equity funding raised by these companies.

cbinsights.com 35 cbinsights.com 36 January 28, 2016

Watch Out BB-8! Seven Grant-Funded Robotics Companies To Watch In The US

From underwater robots originally designed to detect leaks in underwater nuclear reactors to automatic nursing assistants, grants are funding the future of AI and robotics.

We have identified seven robotics companies that received grants in 2014 and 2015 for products that may eventually revolutionize fields ranging from underwater exploration to combat medical assistance. A handful of them received initial funding from federal agencies like the US Department of Defense through a program know as the Small Business Innovation Research (SBIR). MassVentures, a venture capital firm that supports startups in Massachusetts and helps commercialize technologies previously funded by the SBIR/STRR programs, provided grants to 4 of the 7 projects on this list.

1. Boston Engineering

What they do:

The Waltham, Massachusetts-based company recently received a $500,000 Stage III grant from MassVentures and a $200,000 Phase II grant from the US Department of Defense for its unmanned water vehicle (UWV) technology, BIOSwimmer. The tuna-shaped robot mimics the dynamics of fish to improve underwater maneuvering and searches.

“For constricted and hard-to-reach underwater places where inspection is necessary, it’s the perfect fish,” the Department of Homeland Security reported on its website.

Select funders: MassVentures, U.S. Department of Defense

cbinsights.com 37 2. Physical Sciences

What they do:

The company’s quadcopter, InstantEye, has caught the Pentagon’s attention, allowing troops to get “eyes in the sky” at an operating cost of less than $1K, Foreign Policy Magazine reported. The unmanned air system takes inspiration from the flight of hawk moths in turbulent conditions. The company claims the drone has a vertical climb rate greater than 2,000 feet per minute.

Physical Sciences also received a $2.9 million grant in 2014 from the government agency Advanced Research Project Agency-Energy (ARPA-E) for a methane detection system that uses “mid-infrared” lasers mounted on UAVs to inspect leak sites.

Select funders: ARPA-E, MassVentures, US Department of Defense, US Department of Energy

3. Energid Technologies

What they do:

Energid, which develops advanced software for the robotics industry, received a grant for manufacturing humanoid robotic arms with seven degrees of freedom (i.e. “axes of motion” that allow the arm to move independently in different directions).

MassVentures’ $400,000 grant will be used for the development of a product line focused on these robotic arms called Cyton, under the umbrella of Robai — a wholly-owned subsidiary of Energid.

“Software-centric robots have the potential to transform industries. Applications include device testing, parts assembly, packing, and remote inspection,” the company said in a press release.

Select funders: MassVenture

cbinsights.com 38 4. RE2

What they do:

The US Army awarded a grant of approximately $100,000 to Pittsburgh-based RE2 in 2014 to develop a robotic system that can be carried by military vehicles and deployed to provide medical assistance during combat situations and rescue efforts. The payload module, called LIFELINE, will specifically be used in the army’s semi-autonomous ground vehicles for casualty extraction.

Unmanned robots can reduce risk to medical personnel during rescue operations in hostile environments.

Select funders: US Army

5. Hstar Technologies

What they do:

HStar was a winner of the MassVentures 2015 START program for its robotic nursing assistant (RoNA) technology. The project was launched in 2009 with the aim of preventing back injuries in caregivers while carrying patients. HStar claims the autonomous robot can lift patients weighing up to 500 pounds.

In 2011, the company announced that it had secured a total of $1.5M in grants for its RoNa and cRoNA (combat RoNA for military use) from the Small Business Innovation Research program.

Select funders: US Army, MassVentures

cbinsights.com 39 6. Xact Sense

What they do:

The Rhode Island-based startup makes 3D laser-scanning drones that uses LIDARS (light radars) developed by California-based Velodyne for remote sensing. The UAVs are designed for surveying and mapping. It was one of the 16 winners at the startup accelerator MassChallenge’s 2015 Boston event and received a $50K grant from the accelerator.

Select funders: MassChallenge

7. Hydroswarm

What they do:

The underwater, artificially intelligent drones will be used for ocean exploration and to perform specific underwater tasks to prevent risk to human life.

“Originally designed to look for cracks in nuclear reactors’ water tanks, the robot could also inspect ships for the false hulls and propeller shafts that smugglers frequently use to hide contraband,” researchers from MIT — where Hydroswarms founder Sampriti Bhattacharyya first designed the technology — reported. The company was also a winner at the 2015 Boston MassChallenge event and received a $50K grant.

Select funders: MassChallenge

cbinsights.com 40 August 31, 2015

If Robots Are Going To Kill And Replace Us, Here Are 11 Startups To Be Afraid Of

Elon Musk says we should fear artificial intelligence and robots. If so, here are 11 startups to be very afraid of.

AI takes many shapes, and often is only embodied in lines of code running complex machine- and deep-learning software. But in the popular imagination, the threat from AI comes from humanoid machines, i.e. robots, which use their machine strength (and software-powered artificial intelligence) to subjugate their former overlords.

With this in mind we looked at robotics startups that are either replacing humans, or utilizing emerging technologies to interact and increasingly learn from humans.

• Many of these companies — Fetch Robotics, Gamma 2 Robotics, and GreyOrange Robotics — are currently focused on industrial process automation. • There are also those like Bossa Nova Robotics, which develops “personal robots” that are able to “physically interact with people, objects, and the environment.” In addition to the Bossa Nova robots’ patented movement system, they also have a series of spring-loaded legs that can deploy instantly to mitigate a fall, something that could come in handy during a war on humans. • There’s also Jibo, a social robot that learns from its users over time in order to better serve their needs and evokes images of the evil robot HAL 9000 from “2001: A Space Odyssey.”

In all seriousness, on the next page is the full list of 11 robotics startups that are utilizing technology to replace, aid, or interact with humans.

cbinsights.com 41 cbinsights.com 42 cbinsights.com 43 CB INSIGHTS

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