Hailo, a maker of chips that allows edge devices like smart cameras or smart cars to have artificial intelligence capabilities, said on Tuesday that it raised $136 million in a Series C funding round, considered the largest in the edge AI chip space to date. The round brings Hailo’s total funding to $224 million.
A source familiar with the company said the investment values Hailo at over $1 billion, making it Israel’s latest unicorn, a private company valued at $1 billion or over.
Edge devices are electronic devices that are installed at the edge of networks — the entry point to networks — in products such as autonomous vehicles, drones, and smart home appliances including personal assistants, smart cameras and smart TVs, alongside internet of things, augmented reality and virtual reality platforms, wearables and security products.
The investment in Hailo was led by Poalim Equity and Gil Agmon, CEO of Delek Motors, a publicly traded company and the sole importer of Mazda, Ford and BMW vehicles and products to Israel. The round was also joined by existing investors including prominent Israeli entrepreneur Zohar Zisapel, founder of the RAD Group and chairman of Hailo; Swiss-based ABB Technology Ventures (ATV); London’s Latitude Ventures; and Israel’s OurCrowd. Vehicle importer Carasso Motors and Shlomo Group joined the round as new investors.
As part of the agreement, former senior VP at Intel Corporation Mooly Eden will join Hailo’s board of directors, and Eyal Waldman, co-founder and former CEO of Mellanox Technologies (sold to Nvidia in 2019 for $7 billion, will join its advisory board.
Hailo was founded in 2017 by former members of an elite IDF tech unit Hadar Zeitlin, CEO Orr Danon, and Avi Baum.
The company developed the Hailo-8 processor, designed to fit into a range of smart machines and devices. It stems from a “rethinking” of traditional computer and chip design and enables smart devices to perform sophisticated deep learning tasks such as object detection and segmentation in real-time with minimal power consumption, size, and cost, the company has said.
The chip offers the “same performance for smart devices as that provided by large data center computers, paving the way for a future of smarter edge products,” Hailo said in the statement.
This year alone, Hailo said it has doubled its customer base to more than 100 clients as more enterprises seek out AI solutions that empower sensors and smart devices.
Danon told The Times of Israel on Tuesday that the company’s goal for the new funding is to expand and scale up its operations given the surging interest in its Hailo-8 processor, and grow its sales, customer support, and back-office engineering teams across the world.
“We also want to expand the offering itself, releasing new software products to enhance our offering and complement it while also accessing different markets and uses. And also developing the next generation of our technology — which is the biggest effort — and that is to expand both the portfolio that we offer and the addressable markets and products that we can target,” he said.
The processor is a “fundamental element that does data-crunching for deep learning at the edge, and that is utilized to process data such as video, to perform real-time video analytics that can be used in the context of cars or driving assistance systems, or monitoring the quality of products on a production line, to secure perimeters for access control, but the commonality is that all these applications need a strong engine that can go over the data and get the insights. We provide the infrastructure for this, the processor, which is the heart of the system,” said Danon.
“Our processor does all these tasks… with very low power consumption,” he added.
Demand for advanced, intelligent AI chips is growing quickly as the tech world shifts from a focus of centralizing all processing in the cloud to the edge, in a bid to improve latency, cut bandwidth costs and provide a more stable platform that doesn’t depend on network connectivity. In 2019, the global AI chip market was valued at $9.29 billion and is expected to reach $253 billion by 2030, an increase of nearly 3,000%, according to recent research.
Last summer, Hailo opened a wholly owned subsidiary in Tokyo to strengthen its partnerships and relationships with existing customers in Japan and expand into the Asia-Pacific market. And in August, the company signed a deal with Macnica, a leading global semiconductor distributor, to sell its products in Japan.
“In the coming years, AI will become the defining feature for creating new business value and reshaping user experience as we know it,” Eden said in the statement. “The ability to bring AI-based features to market will increasingly be the deciding factor over whether companies succeed or fail. Hailo’s innovative and hyper-efficient processor architecture addresses the growing demand for a new kind of chip to handle these new types of workloads, challenging traditional computing solutions.”
Danon said in the statement that the company was “honored by this milestone round for an edge AI chip company and will use these significant resources to accelerate our aggressive plan to make advanced AI edge solutions more accessible to industries across the globe. This tremendous support is a testament to our unparalleled edge AI product line, and we look forward to empowering even smarter and swifter devices, and thus, a more robust future powered by AI.”
Hailo is based in Tel Aviv and has offices in Taipei, Munich, and Silicon Valley with some 150 employees. Danon said he hopes to grow the team to about 250 by next year.
Shoshanna Solomon contributed to this report.