Some of the top investment firms in Silicon Valley and Seattle are joining up to put $10 million into the Allen Institute AI Incubator for early-stage AI startups. The news comes a day after Apple acquired Xnor. The edge computing AI startup was one of the first companies to receive financial support and mentorship from the incubator and was reportedly acquired for roughly $200 million.
The $10 million fund is being supported by Sequoia Capital, Kleiner Perkins, Madrona Venture Group, and Two Sigma Ventures, alongside a cadre of entrepreneurs and executives, like Tableau CEO Adam Selipsky.
This is the first external round of investment for the incubator, which opened in January 2017 with the goal of launching three to five AI startups a year in Seattle and giving them access to the Allen Institute’s 100 or so AI researchers. The funding round will raise the amount of cash the incubator can give AI startups from $250,000 to up to $800,000.
Beyond the Allen Institute’s growth, Seattle is in the midst of a startup and tech boom. Amazon and Microsoft — two of the world’s most profitable companies — already call the region home, but the acquisition of Turi in 2016 brought Apple to the region, while companies like Google Cloud Platform and Facebook have opened offices there in recent years.
In 2017, Baidu acquired Kitt.ai, a notable NLP company that had also received Allen Institute support. This acquisition helped the Chinese tech giant open its first offices in Seattle.
“Broadly speaking, I think there’s just been so many things that have come together in the last … even the last 18 months that are really starting to accelerate things in Seattle,” AI Incubator managing director Jacob Colker told VentureBeat in a phone interview. “It was not too long ago that Seattle-area entrepreneurs had to get on planes and go down to the Valley with their hat in hand trying to raise money. But in the last 18-24 months that trend has reversed, where it’s VC partners from California, but also other parts of the country, flying to Seattle to meet with entrepreneurs instead.”
In an op-ed Colker and Allen Institute director Oren Etzioni wrote last fall, the two argue that a series of trends are bringing the Seattle region to a tipping point. These include investment from tech giants and employees who act as angel investors, growing venture capital, the support of nearby universities, and a population of 120,000 engineers.
Allen Institute for AI Incubator managing director Bryan Hale said he hopes to see the cultivation of more local or colocated talent in the Seattle ecosystem and to see employees from prominent companies pursue their own projects.
“As we think about where the next five or 10 great founders are going to come from, that’s the other place that we start to think about, which is ‘Can we get this sort of recycling of the talent and capital that is so hard for secondary markets to replicate?’ We’ve got a few signs of that with some exits and some new emerging growth-stage companies over the last few years,” he said.
Author: Khari Johnson
Source: Venturebeat
