Healthcare and AI are natural partners, says a new industry rundown. Meanwhile, Microsoft has bought Nuance for over $19 billion. Chris Middleton reports.
Technology and investment analysis firm CB Insights has unveiled its fifth annual list of the 100 most promising artificial intelligence companies, after a year in which the technology landscape has been irrevocably changed by the pandemic.
The analysts’ selection – see the graphic, below – has been pulled from a list of over 6,000 companies, highlighting just how big a hotspot AI currently is.
Inclusion in the final 100 was based on a variety of factors, including technology innovation, market potential, competitive landscape, team strength, business relations, investor profile, media sentiment analysis, and R&D activities.
Players come from 12 countries – 64 from the US, eight from the UK, six apiece from China and Israel, and five from Canada. The other nations are Japan, Denmark, Czech Republic, France, Poland, Germany, and the world’s most automated country, South Korea.
Companies are driving innovation across 18 sectors, with a broad range of cross-industry applications. This mirrors the robotics market, where cross-cutting technologies are favoured by investors, as they stand the greatest chance of establishing commercial scale.
The health of the market
Unsurprisingly, the key sector for 2021 is healthcare, with eight companies making the cut: Caption Health; Recursion; Unlearn; theator; Overjet; Olive; Insitro; and Owkin impressing the analysts.
Several of the AI 100 have developed new products or features in direct response to the pandemic. For example, Recursion publicly released SARS-CoV-2-related imaging datasets to improve understanding of the virus.
Meanwhile, machine learning specialist Darwin AI launched COVID-Net, a suite of neural networks for Covid-19 detection and risk assessment in chest radiography.
In healthcare more generally, one hotspot – particularly in the US in healthtech-focused cities such as Houston – is the combination of smart medical devices/appliances with AI and machine learning. This allows patients and doctors to move towards health management, along with more targeted and predictive care.
In the wider US healthcare system, accelerated clinical trials and smart insurance are other key areas for AI development. Another is automating the reporting process for doctors – for more on this, see below.
Transports of delight
Transportation is the second largest industrial sector in the AI 100 this year, with seven companies vying for customers’ and investors’ attention: parallel domain; Konux; Aurora; Deepmap; momenta; algolux; and Ghost.
Other key sectors include supply chain & logistics (four companies); retail & CPG (four companies); and finance & insurance (three companies).
In the technology half of the 100, hotspots include: feature stores & machine learning operations platforms (MLOps, six companies); cybersecurity (five companies); sales & CRM (five companies); AI processors (five companies), with a particular hotspot being chips that focus on high performance and low power consumption; AIOps automation (three companies); and deep learning accelerators (three companies).
According to CB Insights’ figures, the AI 100 have raised over $11.7 billion in equity funding between them since 2010, across more than 370 deals with 700 investors.
Thirty-seven of the 100 are early-stage innovators, at the seed/angel or Series A stages. These are working in areas such as AI explainability (eg Arthur AI), wireless signal processing (DeepSig), and deep learning accelerators (Deci).
At the other end of the scale, many of the companies that have raised the most funding are working on capital-intensive projects, such as autonomous vehicles, drug R&D, and AI processors.
The 12 unicorns in the list (companies with valuations of over $1 billion) span applications as varied as data annotation, cybersecurity, sales & CRM platforms, and enterprise search.
However, emerging use cases such as AIOps and revenue cycle management for hospitals have also attracted mega-rounds (investment rounds worth $100 million-plus).
CB Insights’ track record of identifying promising companies is worth considering. From last year’s AI 100 cohort (published in March 2020), two startups have already become unicorns, AInnovation and Standard Cognition. Six have exited – three via IPO – and just half of the 2020 100 have collectively raised $5.2 billion across 75 deals, including 16 mega-rounds.
Microsoft buys into US hospitals
In related news, Microsoft has announced the acquisition of speech recognition AI firm, Nuance, for $19.1 billion – the second largest deal in Microsoft’s history, after LinkedIn.
Founded in 1992, Nuance helped Apple develop Siri and has more recently focused on helping doctors automate the production of medical reports, via dictation.
However, with speech recognition and digital assistants already in Microsoft’s portfolio, the core purpose of the deal is to buy Microsoft a much larger presence in the healthcare sector – particularly in the US, where 80 percent of hospitals are Nuance customers.