Last year, when we wrote about new investment for Israeli startup Granulate, which applies artificial intelligence to high-priority computing workloads to improve how they travel across customers, we noted the network management space. Today, that trend is touching the startup itself: chip giant Intel has announced that it is acquiring Granulate, to continue extending its operations in Israel, and the tools that Intel provides to customers to better manage traffic on Intel-powered kit.
A number of publications reported that the acquisition was in the works for about a week now. The $650 million acquisition is confirmed by Intel and Granulate in a press release, but sources tell us that is not the actual number.
The 120 Granulate employees are expected to join Intel after the deal closes.
Sandy Rivera, executive vice president and general manager of the Datacenter and Artificial Intelligence Group at Intel, said that today's cloud and data center customers demand high- performance software to make the most of their hardware deployment.
Greg Lavender, chief technology officer, senior vice president and general manager of the Software and Advanced said that they are building their portfolio of software optimization tools that offer flexible andScalable capabilities that allow them to meet the growing demand of the ubiquitous compute era.
According to PitchBook, Granulate had raised $48.6 million with a modest valuation of $110 million, with previous investors including Insight Partners, Red Dot Capital and Dawn. It had last raised money a year ago in a $30 million Series B, so it looks like this deal might have come out of the company talking to companies for investment.
The acquisition is part of a larger effort at Intel.
It shows how Intel is continuing to build out more tools and services to help its customers manage Intel-powered networks better, in part to compete more squarely against the likes of Nvidia, which has also been snapping up smaller companies to build out high performance computing capabilities and the management of them.
Granulate works across multiple cloud and on-premise environments, where it claims its software can improve response times by up to 40%, and throughput up to five times. Smaller organizations can still be huge, but they don't have the bandwidth to build their own technology as big companies do.
We are aware of similar things going on inside of Netflix as what we have built, Asaf Ezra, co-founder and CEO of Granulate told me last year.
Granulate will be an easy fit because the two already collaborated to design solutions for customers that use Intel-powered compute architecture. Microsoft, IBM, and many more are partners of Granulate.
Granulate says that its so-called Intel-Agent, built to work specifically on server using Intel's processors, incorporates Intel's AVX instruction set. Granulate claims that it can be installed on a workload in 15 minutes, and that it uses artificial intelligence to learn how a workload behaves.
Last year, Intel's long-time sales director, Ron Whitfield, jumped to lead business development at Granulate to build out its customer base internationally, and to more market segments. The bigger Granulate became, the more likely it would be an acquisition target for Intel. Getting acquired will allow the company to scale its business in a way that would have been more difficult on its own.
Together with Intel, we can help customers achieve meaningful cost reductions and five times the throughput.
The deal appears to be part of a larger effort by Intel to expand its presence in Europe and Israel. The company announced a 33 billion dollar investment into R&D and manufacturing in Europe, the first part of an 80 billion dollar investment over several years across a number of EU countries.
Intel has been at the forefront of what it is doing on this side of the world and its efforts in Israel have been very much in line with that.
Intel made a $600 million investment into its R&D last year, which was at the center of the company's plan to spin out its Mobileye division. It has made a number of other M&A moves there.
It said in February that it intended to acquire Tower Semiconductor for $5.4 billion. Other deals include Cnvrg.io and Habana Labs. It missed out on a couple of key acquisitions, including the big data chip business, and was rumored to be interested in Mellanox.
Intel believes in Israeli innovation to help it stay ahead of the markets in various segments. Two of its most significant acquisitions, Mobileye and Tower Semiconductor, have been Israeli companies. We know that it will be buying more software companies here.
All Rights Reserved © 2024
