Commentary

Artificial Intelligence M&A Slows In April

Unlike March, April had no $15 billion deals for artificial intelligence technology. What’s more, not one April AI deal included an announced value. But the number of deals AI picked up — nine — remained well above last year’s average of six per month.

Being a long-time observer of tech M&A, however, I’ve seen this pattern before. While I don’t expect another $15 billion deal all that soon, the combination of low value plus (relatively) high deal volume usually means timing is a factor. Expect more large AI deals to come.

For those focused on marketing AI technologies, though, there were only two in April that even came close. One was Market Track’s acquisition of 360pi, whose AI provides retail pricing and other market intelligence in a software-as-a-service platform for consumer brands. The second was by mobile and integrated payment solutions provider Spindle, which acquired only the AI assets of book discovery Web site  CoverCake. More specifically, that includes intelligent algorithms for data mining with the ultimate goal of enhancing consumer engagement.

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Another April oddity: no cybersecurity AI.

Remaining AI deals were pretty typical. There were two deals for visual recognition technology. Baidu acquired robotic vision specialist xPerception Technology, whose AI helps fast-moving robots (think: drones) avoid obstacles, remain stable and follow specific objects. This purchase appears to be part of Baidu’s effort to build autonomous cars.

Then industrial machine vision company, Cognex, bought Vidi Systems — “deep learning vision software dedicated to automated aesthetic inspection & classification,” according to its Web site. This is the kind of stuff that manufacturers put on assembly lines to inspect and determine quality of products or their components — or food ingredients — as they flash-buy at warp 9. It’s actually very cool, in a deeply nerdy way.

There were two healthcare AI deals, Intermedix-WPC Healthcare and Lumeris-Forecast Health. In both cases, the targeted AI technologies promise to identify diseases faster — and lower health care costs. If only it were that simple.

Accenture acquired Genfour, a U.K. robotic process automation (RPA) software company. RPA barely qualifies as AI, using machine learning to constantly get better at repetitive tasks normally performed by white-collar workers –—and often, nowadays, outsourced and offshored. Think about your large company’s offshore accounts payable team, or all the finance department work that goes into closing the quarter.

Big 4 accounting firms and their competitive set are all over RPA, which can replace human workers doing things like data entry, or rules-based expense report approvals, often by working directly through a software program’s user interface rather than an application programming interface (API). Genfour even refers to its software as “digital workers.”

Rounding out April’s AI deals are yet another for satellite imagery analysis software, EagleView Technologies-OmniEarth, which has been undergoing consolidation this year; and a pure AI infrastructure deal, Infosys-Skytree.

Skytree Server uses machine learning to find patterns and make predictions from complex, massive enterprise data. Infosys plans to incorporate it into an enterprise AI platform it calls InfoSys Nia, which consists of a suite of AI offerings (including RPA — no surprise).

To review the first quarter’s AI deals, including that $15 billion megadeal, check out our January, February and March deal roundups.

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