Explosion, an open-source machine learning library and a suite of commercial development tools has announced today a $6 million Series B at a $120million valuation. SignalFire led the round and reported that today's investment represented 5% of its total value.
Oana Olteanu, SignalFire, will join the board as per the terms of the deal. This includes warrants for $12 million additional investment.
Explosion is fundamentally a software company. We build tools for AI, machine learning, and natural language processing. Ines Montani, CEO and co-founder of Explosion, explained that our goal is to make developers more productive, more focused on natural language processing. This means understanding large amounts of text and training machine learning models in order to automate certain processes.
Montani met Matthew Honnibal, her co-founder in Berlin in 2016, while he was working on spaCy's open source machine learning library. This open-source project has been downloaded more than 40 million times.
Prodigy was added to the company's 2017 product line. This is a commercial product that generates data for machine learning models. Machine learning is code plus data. To get the most from the technologies, you will almost always want to train and create custom systems. Whats more, what's most important to you and your company are the problems you are trying to solve. We found that creating training data and training machine learning models was an area that most people weren't paying much attention to, she stated.
Prodigy Teams is the next product in the pipeline, and this is why the company made this investment. Prodigy Teams [a hosted service that] adds collaboration and user management features to Prodigy. It can be run in the cloud without compromising what people love most about Prodigy which is data privacy. So no data needs to ever get seen by our servers. This is done by placing the customer's data in a private cloud cluster, then using the Prodigy Teams management tools in the public cloud.
They have 500 companies that use Prodigy today, including Bayer and Microsoft. All this was possible with 6 employees at the beginning, which has now grown to 17 and will continue to grow over time to 20.
She believes that if you aren't thinking about diversity in your hiring process, then it is likely that you have a problem. She said that if you think too much about diversity in hiring, it could be a sign that you have a problem.
It's not unusual to have difficulty attracting people who don't look like your 50-year-old dudes. Our strategy is to hire great people. However, if you follow the [startup] rules, your options may be limited.
She stated that they never saw themselves as a traditional startup, following a conventional path. We have not raised any capital [until now]. She said that we grew the team organically and focused on being independent and profitable [before we received outside investment].
Montani said that more than just the money was important, they also needed an investor who would support open source and understand the business. This is even while Montani has capital to expand the company's other parts. Open source is a community made up of customers, employees, and users. They are real people and they are not pawns in some startup game. She said that it is real and these people are real.
They are more than my grand promises and eyeballs. Montani stated that it is important that, even though we are selling a small percentage of our company to raise capital [to build our next product], that open source remain at the heart of our company. That's something that we don't want to compromise on.