Who got funded, and for what?
Good sector research — tracking those questions and also the demand-side market opportunity — is the foundation for smart-money investment. And it’s good research that guides savvy product developers and marketers who have to square technical possibility with competitive market reality. Someone has to be willing to pay for what you’re building and selling, whether that someone is an investor who’s anticipating future profits or (even better!) a customer who likes and needs your work.
So it pays to follow the money, to track investment and M&A activity, and see what insights and trends you can infer.
In natural language processing (NLP) and text and sentiment analysis — as in other tech spaces — investment funds technology productization, company building, and market entry and expansion. Academic and government research funding is important, but it’s angel, VC, institutional, and acquisition money that’s a best indicator of growth directions. It’s that money — investment in emerging text analytics players — that I’ve tracked, for 2015 just as in previous years.
Here is my compilation, with overlapping/adjacent fields including natural language processing (NLP), search, and semantic applications part of the mix. I include brief elaboration and link to sources. Where you place your bets is up to you.
Follow the Money: 2015 Investments in NLP and Text and Sentiment Analysis
I’ll preface my list by offering industry and application focal points, a set of points that is unsurprisingly headed by analysis of online and social media followed, equally unsurprisingly, by funding toward broadly-usable tech tools, which are split out in two forms as second and third on my focal-point list. My categorization of 2015 funding and acquisition events is as follows:
- five are in social/media analysis (Sysomos, Signal, NetBase, Viralheat, Strossle)
- four deliver text/sentiment analysis as-a-service, via an API, or a toolkit (Bitext, Sentisis, Cortical.io, MonkeyLearn)
- four are broadly multi-functional (Dataminr, Linguasys, Treparel, Sensai)
- four involve AI for speech or conversational interfaces (Wit.ai, Api.ai, DigitalGenius, Semantic Machines)
- four are in media & publishing (Automated Insights, Appinions, Wibbitz, TEMIS)
- three are in HR (Textio, Jobandtalent, Texternel)
- three are in life sciences (Health Fidelity, TEMIS, NarrativeDx)
- two break out as having a customer experience focus (Medallia, NewBrandAnalytics)
- one specializes in legal information (Lex Machina)
- one involves office tools (Equivio)
- one focuses on financial news (Clueda), and
- one is a very early-stage startup (Semantile)
That’s a broad distribution, and yes, I’m double-counting TEMIS. It’s also a distribution that doesn’t include any home runs. If you’re looking for a billion dollar IPO, don’t pin your hopes on text analytics, although per my May, 2015 VentureBeat article, Where are the text analytics unicorns?, a few solution focused, text-analytics reliant companies are on break-out track (namely Medallia and Clarabridge; Sprinklr too). Plus NLP is at the core of just-about everything Google and Baidu do and much of Facebook’s, IBM’s, Amazon’s, and Microsoft’s businesses.
Review my funding list and assess for yourself:
“Facebook Acquires Wit.ai To Help Its Developers With Speech Recognition And Voice Interfaces.” (January 5, 2015)
Health Fidelity took a $19.26 million investment from UPMC, the University of Pittsburg Medical Center. (January 9, 2015) The company applies “groundbreaking NLP and analytics technology,” based on the MedLEE system licensed from Columbia University, as part of a “risk adjustment solution.”
“Microsoft acquires text analysis startup Equivio, plans to integrate machine learning tech into Office 365.” (January 20, 2015)
“Inveready leads a $900,000 Seed Round for Bitext,” which a Spanish text/sentiment analysis specialist. (January 29th, 2015)
“Microsoft, Amazon vets raise $1.5M to help recruiters optimize job postings with Textio” (February 2, 2015) followed by “Textio Raises $8 Million in Series A Financing Led by Emergence Capital.” (December 16, 2015)
Newly Independent Sysomos Re-emerges to Transform Social Intelligence.” (February 10, 2015) A key distinction for Sysomos is that the company’s social-media platform was built around own text analytics.
In the natural language/content generation world: “Vista Acquires Automated Insights, The Startup Behind The AP’s ‘Robot’ News Writing,” for a reported $80 million in cash. (February 12, 2015)
With a media-analysis focus, applying NLP, UK company Signal took at $1.4 million seed round (October 9, 2015),that after taking £1.2m in seed funding in September 2014 (reported as “Signal Raises $1.85 Million Seed Round” in March 2015).
Strong social media analysis involves text analytics: “Dataminr Raises $130 Million in Growth Capital from Leading Financial Industry Investors.” (March 17, 2015)
“NetBase Lands an Additional $24M in Series E Funding” (March 13, 2015) followed by “NetBase Secures $9M in Additional Series E Funding.” (April 29, 2015) My reading is that NetBase, which is built around sophisticated NLP and knowledgebase technology, is aiming for an IPO as soon as market conditions are right.
“¿Qué Es? Sentisis‘ NLP SaaS Platform For Spanish Pulls In $1.3M.” (March 18, 2015) Sentisis is an Argentine start-up that is working to build a customer base in Latin America and North America.
“Sensai Raises $900K To Help Data Scientists Query Unstructured Data.” (Reported as $1.3 million seed funding by CrunchBase.) (March 31, 2015) Co-founder Monica Anderson has a long background in machine language understanding.
“Content Marketing Platform ScribbleLive Acquires Appinions.” (April 15, 2015) Appinions started life in 2007 as Jodange, commercializing opinion-mining work by Cornell University computational linguist Prof. Claire Cardie.
“Research and Analytics Firm Evalueserve acquires Treparel,” a Netherlands text analytics provider. (May 4, 2015)
“MonkeyLearn is a machine learning platform on the cloud that allows software companies and developers to easily extract actionable data from text,” a spin-off of development shop Tryolabs. The company took $250 thousand in seed funding, adding to $300 thousand in 2014 seed funding. (May 27, 2015)
Clueda AG, a German financial news analysis specialist, sold itself in May 2015 to Baader Bank AG. Clueda was founded in 2012, applying cognitive methods to real-time text analysis.
NarrativeDx took $650 thousand in seed funding in June, followed by $718 thousand in debt financing July, according to CrunchBase. (June 8, 2015) (I suspect the $800 thousand seed funding listed is a duplication.) The start-up applies NLP for sentiment analysis to patient surveys, social media, and other material.
“Expert System has signed an agreement to acquire French text analytics company TEMIS for €12m EV (€4m cash, €1m debt acquired and €7m in shares)” (May 6, 2015) followed by “Expert System Announces €5 million bond issue with 4% fixed annual interest rate, maturing in 2024.” (July 31, 2015) The combined Italian-French company is actively expanding in North America.
Israeli start-up Wibbitz, which applies NLP to the task of generating video from text, took an $8 million Series B round. (May 21, 2015)
For its platform, applying linguistic analysis and machine learning,” Jobandtalent Secures a $25M Boost! (May 25, 2015)
Social customer experience provider Sprinklr acquired NewBrand Analytics in June. See CEO Ragy Thomas’s “Introducing NewBrand: Why the Industry’s Leading Location-Specific Text Analytics Means Better Customer Experience.” (June 2, 2015)
“Artificial intelligence startup DigitalGenius raises $3M to help companies automate customer service.”(June 22, 2015)TechCrunch’s report puts it this way: “DigitalGenius is building an automated customer service platform driven by artificial intelligence (AI) and natural language processing (NLP).”
“Medallia announces unicorn status with $150 million funding round.”(July 21, 2015) Medallia is a customer experience solution provider with strong own-built text analytics capabilities.
“CareerBuilder Joins Forces with Textkernel to Deliver Powerful, Multilingual Semantic Search and Matching Technologies to Recruiters,” acquiring a majority stake. (July 21, 2015)
“Aspect Software Announces Acquisition of the Technology Assets of LinguaSys, a Leading Provider of Natural Language Understanding (NLU) and Interactive Text Response (ITR) Technology.” (August 11, 2015) LinguaSys deploys the Carabao language toolkit acquired from Melbourne, Australia’s Digital Sonata along with the services of DS’s Vadim Berman.
“Api.ai Raises $3M For Its Siri-Like Conversational UI, Makes Developer Usage Free.” (August 19, 2015)
“Sprinkle Acquires Saplo and Changes Name,” to Strossle. (August 31, 2015) Text analytics provider Saplo was founded in 2008. The name change from Sprinkle to Strossle? Must be a Swedish thing.
“Cortical.io: USD 1.8 million for brain-inspired algorithm made in Austria.” (October 30, 2015) The company’s aim is to deliver real-time NLP via the Retina engine.
Lex Machina applies proprietary NLP and machine learning to extract information from legal materials. The company was acquired by LexisNexis for an undisclosed amount, possibly in the $30-35 million range. (November 23, 2015)
“Artificial intelligence startup Semantic Machines raises $12.3 million.” Semantic Machines is building out “conversational AI” technology. (December 23, 2015)
Semantile, “a stealth-mode enterprise semantic relevance engine company,” took a seed funding round late in the year. (December 28, 2015)
I’ll add that my count is that of these thirty-two, twenty-one are US based, eight have their homes in Europe, and one each is Argentine, Canadian, and Israeli.
But that’s not all. Many companies apply third-party text analytics as a core part of their product line, Tracx, Coveo, and Ontotext, listed below, among them. By contrast, Clarabridge and IBM have proprietary text analytics and made buys that expand platform capabilities, in social analytics and search relevance, respectively.
“Tracx raises $18 million in funding.” Tracx’ business is social media analytics and social relationship management; the platform relies on outside text analysis. (February 2, 2015)
IBM acquired the blekko “advanced Web-crawling, categorization, and intelligent filtering technology” and team added it to the Watson stack. (March 27, 2015) Check out “Data, Data, Everywhere – Now a Better Way to Understand It.”
“Clarabridge Acquires Engagor,” not a text analytics play, but rather a social-analytics buy that expands text analytics/customer experience provider Clarabridge’s portfolio and European presence both. (May 21, 2015)
“Coveo, a recognized leader in intelligent search, has secured $35 million in Series D financing to fund the company’s aggressive growth,” according to a company press release. While Coveo relies on outside NLP software, we’re in close-enough territory for inclusion here. (November 5, 2015)
The parent of graph database vendor Ontotext, which has strong text analytics capabilities, albeit like Coveo’s sourced from outside (the GATE project), went public on the Bulgarian Stock Exchange. That’s Sirma Group Holding. (November 23, 2015)
A 2016 Start
Finally, a couple of 2016 events worth noting:
French company “Dictanova raises 1.2 million euros to accelerate development.” (January 8, 2016) Dictanova was founded in 2011 to commercialize NLP tech developed at the Univ. of Nantes, for Voice of the Customer applications.
Customer experience text-analytics provider Attensity sold its Europe arm Attensity Europe GmbH, to CEO Thomas Dreikauss and IMCap Partners for an undisclosed amount. (January 13, 2016)
That’s it for my run-down of 2015 investment and M&A activity in NLP and text analytics. Thanks for reading, and please do tip me off to any activity I’ve missed. And for additional insights, for the year to come, see my 2016 technology and market directions assessment, Text, Sentiment & Social Analytics in the Year Ahead: 10 Trends.