The hot money is on cyber security business Darktrace becoming Cambridge’s 16th company to attain a billion dollar valuation. It is within striking distance with a private valuation of some $825 million following this week’s $75m Series D round. We reckon it will bust the barrier this year at its current rate of progress.
Darktrace certainly looks a unicorn in the making – as billion dollar startups are known. It was only founded in 2013 and the man behind the venture, Mike Lynch, told me: “It’s not bad from a standing start.”
And that is the point. As we researched the fastest companies in Cambridge to attain the milestone, thoughts went back to telecoms provider Ionica, credited by Wiki and many informed local brains as the first and fastest local technology startup to attain the $1bn valuation.
So we go back to Mike Lynch’s extremely valid point regarding a standing start. Ionica was actually founded in 1991 and went through agonies in trials; it only physically operated between 1995 and 1998 and floated in July 1997 with shares initially trading at 390p.
But that was at the height of the dotcom boom and from IPO it was downhill all the way until administrators were called in during 1998.
So, it seems fair to say it took Ionica six years from foundation to become a billion dollar baby. Darktrace therefore has time on its side to beat the record for Cambridge and, barring unforeseen disasters, would certainly be the fastest surviving Cambridge startup to cross the line.
The other point to remember is that it remains private at the time of writing. Ionica in its pomp was a public company.
First thing is to get there before we start rewriting the record books, but the rate of Darktrace’s progress flags up another valid point about the current technology scene in the cluster – the number of potential unicorns in the new wave of AI and machine learning startups.
A group of unicorns is called a blessing and one hopes the Cambridge candidates for such status are not in disguise. Opinions will differ and there is many a slip twixt cup and lip – but money men follow entrepreneurs with a track record. When they have a track record and a red hot technology play they become doubly attractive to global investors.
I would suggest two of the very youngest who really stand out as baby unicorns – known in the trade as sparkles or shimmers.
The first is FiveAI – and here are some of the whys. CEO is Stan Boland – the man who plucked ARM out of Acorn; spun out Element 14 (acquired by Broadcom for $640m in 2000); co-founded Icera which was acquired by Nvidia for $367m in 2011 and then found the upside of fledgling Neul’s technology and persuaded Huawei to splash the cash when it looked like the young business was heading nowhere fast.
FiveAI has the technology that will make autonomous vehicles really safe thanks to its unique software suite. The company is educating the manufacturers about how much software is really needed to achieve acceptable standards of safety and reliability.
It has superb advisers, not least Professor Andrew Blake, who was director of Microsoft Research Cambridge and became the first director of the Alan Turing Institute.
Also notable in the field is Dr Subramanian Ramamoorthy, a reader in robotics in the School of Informatics at The University of Edinburgh. Wherever you look among the scientific advisers and management team there is across-the-board excellence.
Boland reckons FiveAi should be targeting $50m in upcoming funding rounds to accelerate commercialisation. No-one would bet against him passing every milestone along the silicon highway.
PROWLER.io looks the other home banker. PROWLER.io develops autonomous decision making systems on the cutting edge of Artificial Intelligence and Machine Learning.
Using state of the art computational tools – probabilistic modelling, reinforcement learning and multi-agent systems – it builds agents that rapidly learn from and adapt to their environments.
It started with just three founders and emerged from stealth with £1.5 million in seed funding in September 2016. In under 10 months it is up to more than 30 staff, hiring world-class engineers at warp speed and set to announce a significant funding round in the near future.
The business has grown so fast it had to swiftly vacate its first home at Barclays Eagle Labs and is now at much larger offices at Charter House in Hills Road in Cambridge’s rapidly swelling business quarter. It is currently looking to hire for roles such as machine learning researchers, senior software engineers and software engineers in test.
CEO and co-founder Vishal Chatrath has been dubbed by Cambridge entrepreneur Dr Hermann Hauser “a magnet for attracting world talent,” and he is living up to that tribute. He looks a world-class act.
There will be others from the current crop if they maintain focus, raise the right amounts of funding at the optimum times – and can find enough world-class engineers to deliver the vision. This latter may be the greatest challenge and obstacle to even the very best.