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This article was published 10/5/2017 (1020 days ago), so information in it may no longer be current.
Invenia, the Winnipeg company that has built a machine-learning system that optimizes power grids across North America, has landed the largest investment yet from the only venture capital firm dedicated exclusively to artificial intelligence.
San Francisco-based Zetta Venture Partners has invested US$5 million in Invenia in what company officials expect will become a $10-million round.
Invenia has been around for about a decade and has built a system that can predict supply and demand in the electrical markets by aggregating massive amounts of data related to the electrical power generation and distribution systems around the world and applying its machine-learning algorithms to make increasingly better predictions. It deploys the technology by investing in next-day markets across North America.
Its involvement in the markets has helped improve the efficiency of the grid for over 37 Gigawatt hours of power (enough to run two-million homes for a year), while lowering CO2 emissions by over two-million tonnes (an average car emits around five tonnes per year) in Canada and the U.S.
Matthew Hudson, Invenia's CEO, said the company has has strong organic growth and has been working hard at finding the right investment partner.
"For startups in general, you want smart money, and it takes time to find the right people with the smart money and value to add to the partnership," Hudson said. "It took longer than anticipated to find the partner we really liked and to get to know them well enough to decide to move forward with."
The cash injection will allow the company to double in size in the next 18 months. It currently employs about 20 people in Winnipeg and about 10 in Cambridge, England. Hudson said it is likely Invenia will expand its business in Europe by the end of the year.
The deal comes at a time when the Canadian government has expressed enthusiastic support for the development of AI technology with the $125 million Pan-Canadian Artificial Intelligence Strategy. Efforts are also underway in Manitoba to create a community partnership called Enterprise Machine Intelligence and Learning Initiative.
Invenia's growth can support and potentially be supported by both those initiatives.
"We are doing exactly what they (the federal government) envision Canadian companies and Canadian researchers being able to do. We are just doing in it Winnipeg, which is maybe not what they expected," Hudson said. "We are going to work with all levels of government to figure out how to keep succeeding in Canada and in Manitoba."
Zetta Venture Partners is a $160-million fund that started in 2013. It typically makes smaller investments in more early stage companies. But Ash Fontana, one of Zetta's founding partners, said the connection with Invenia was a natural for both sides.
"There is a moral imperative to use AI to increase the quality of life on the planet with an increasing population and shrinking resources," he said.
Fontana said a lot of people are starting to realize the potential of AI, but many don't really know how, or are using it for things that are not really important.
"Invenia is building a platform — and has been for a long time... they were early to this AI wave — that optimizes power grids and reduces harmful emissions," he said. "They are using intelligent systems to solve huge societal problems: the use of our energy resource."
It is also a $1-trillion global business, and Fontana said Invenia has the potential to experience extreme growth in the coming years.
Martin Cash has been writing a column and business news at the Free Press since 1989. Over those years he’s written through a number of business cycles and the rise and fall (and rise) in fortunes of many local businesses.