The future of the connected home, connected car and connected everything will have a lot of imaging technology at the center of it: sensors to track the movement of people and things will be a critical way for AI brains to figure out what to do next. Now, with a large swing toward more data protection -- in part a reaction to the realization of just how much information about us is being picked up -- we're starting to see some interesting solutions emerge that can still provide that imaging piece, but with privacy in mind. Today one of the startups building such solutions is announcing a big round of funding.
Vayyar, an Israeli startup that builds radar-imaging chips and sensors, as well as the software that reads and interprets the resulting images used in automotive and IoT applications (among others) -- providing accurate information about what is going on a specific place, even if it's behind a wall or another object, but without the kind of granular detail that would actually be able to personally identify someone -- has picked up a Series D of $109 million, money it will use to expand the range of applications it can cover and to double down on key markets like the U.S. and China.
From what I understand from sources close to the deal, this round is being done at a valuation "north" of $600 million, which is a big step up on the company's valuation in its C-round in 2017, which was at around $245 million post-money, according to PitchBook data.
Part of the reason for the big multiple is because the company already has a number of big customers on its books, including the giant automotive supplier Valeo and what Raviv Melamed -- Vayyar's co-founder, CEO and chairman -- described to me as a "major Silicon Valley company" working on using Vayyar's technology in its smart home business.
I was going to write that the funding is notable for the large size, but it feels these days that $100 million is the new $50 million (which is to say, it's becoming a lot more common to raise so much). What's perhaps more distinctive is the source of the funding. This Series D is being led by Koch Disruptive Technologies, with Regal Four (an investment partner of KDT) and existing investors including Battery Ventures, Bessemer Ventures, ICV, ITI, WRVI Capital and Claltech all also participating. The total raised by the startup now stands at $188 million.
Koch Disruptive Technologies is the venture arm of Koch Industries, the multinational giant that works across a range of oil and gas, manufacturing, ranching and other industries. It was founded by Fred Koch, the father of the Koch brothers, Charles and the late David, the longtime owners who are mostly known in popular culture for their strong support of right-wing politicians, businesses and causes. It's an image that hasn't really helped the VC arm, and its partners seem to be trying to downplay it these days.
Putting that to one side, the Vayyar investment has a lot of potential applicability across the many industries where Koch has holdings.
“Advancements in imaging sensors are vital as technology continues to disrupt all aspects of society,” said Chase Koch, president of Koch Disruptive Technologies. “We see incredible potential in combining Vayyar’s innovative technology and principled leadership team with Koch’s global reach and capabilities to create breakthroughs in a wide range of industries.”
Over the last several years, the startup has indeed been working on a number of ways of applying its technology on behalf of clients, who in turn develop ways of productising it. There are a few exceptions where Vayyar itself has built ways of using its tech in direct consumer products: for example, the Walabot, a hand-held sensor that works in conjunction with a normal smartphone to give people the ability to, say, detect if a pipe is leaking behind a wall.
But for the most part, Melamed says that its focus has been on building technology for others to use. These have, for example, included in-car imaging sensors that can detect who is sitting where and what is going on inside the vehicle, useful for example for making sure that no one is dangerously blocking an airbag, or accidentally setting off a seatbelt alarm when not actually in a seat, or (in the case of a sleeping baby) being left behind on accident, creating potentially dire outcomes.
Regulations will make having better safety detection a must over time, Melamed noted, and more immediately, "By 2022-2023 it will be a must for all new cars to be able to detect [the presence of babies getting left behind when you leave the car] if you want to have a five-star safety rating."
The focus (no pun intended) on privacy is a somewhat secondary side-effect of what Vayyar has built to date, but that same swing of regulation is likely to continue to put it into the fore, and make it as much of a feature as the imaging detection itself.
Vayyar is not the only company using radar to build up better imaging intelligence: Entropix, Photonic Vision, Noitom Technology and Aquifi and ADI are among the many companies also building imaging solutions based on the same kind of technology. Melamed says that this is where the company's software and algorithms help it to stand out.
"I think when you look at what we have developed for example for cars, these guys are far behind and it will take some time to close the gap," he added.