Market Insights

Microsoft invests in OpenAI and Acquisitions Galore: Friday Dealbook for 7/26/2019

July 26, 2019

Acquisitions abound this week as Workday acquires Trusted Key Solutions and Haptik acquires Convrg. Meanwhile, Microsoft agreed to invest $1 billion in OpenAI to expand Microsoft Azure’s AI capacities. Despite skepticism of the applicability of blockchain and artificial intelligence, investment activity remains lively, demonstrating enterprises’ continued belief that these technologies are viable solutions to existing challenges.

 

The Top Deals Covered by OWI this Week

 

OpenAI \ openai.com \ Founded in 2015

Provider of artificial intelligence research services created to advance digital intelligence. The company’s artificial intelligence research services provides an open source environment that is readily available to the public, enabling users to develop skills and gain knowledge in artificial intelligence.

The company reached a definitive agreement to receive $1 billion of financing from Microsoft (NASDAQ: MSFT) on July 22, 2019. The funds will be used to further extend Microsoft Azure’s capabilities in large-scale AI systems. Previously, the company received $1 billion of grant funding from Amazon Web Services, Elon Musk, Sam Altman, Peter Thiel, Reid Hoffman, Jessica Livingston, Y Combinator and Infosys on December 11, 2015. 

 

Trusted Key Solutions \ trustedkey.com \ Founded in 2016

Developer of a blockchain-based secure digital identity platform intended to accelerate online customer acquisition. The company’s platform uses a secure online consumer enrollment process as well as cryptography and blockchain technologies, enabling clients to bridge the gap between consumers’ need for speed of transactions and their demand for secure handling of their private information.

The company was acquired by Workday (NAS: WDAY) for an undisclosed amount on July 18, 2019. The acquisition is part of Workday’s broader vision of blockchain-based work credentialing.

 

Convrg \ convrg.io \ Founded in 2017

Developer of messaging platform designed to reach their consumer on messaging apps and voice assistants. The company’s platform uses machine learning to adopt the language of the brand by creating conversational experiences that are elegant and purposeful, enabling clients to solve a variety of complex business issues through goal-oriented conversations and allowing consumers to shop by voice.

The company was acquired by Haptik for an undisclosed amount on July 24, 2019. Haptik, headquartered in Mumbai, completed the acquisition in order to drive expansion in the North American market.

 

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Investor Highlight

 

Founder Collective \ foundercollective.comFounded in 2009

Description of Investor

Founder Collective is a seed stage venture capital fund that seeks to invest in the advertising technology, business product, business service, consumer service, consumer product, e-commerce, embedded device, healthcare, mobile, marketplace, information technology and software sectors. The firm was founded in 2009 and has offices in Cambridge, Massachusetts and San Francisco, California.

Active Portfolio – 164

Investments (TTM) – 16

Med. Round Amount – $2.90M 

Med. Valuation – $12.10M

# of Exits – 132

Deal History

In the past year, Founder Collective has invested in the following 4 identity companies:

Ethyca

Trusted

Zoba

Perksy

*Source: PitchBook Data Inc. with proprietary keyword searches set by OWI Analysts