5 months ago
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There’s a lot of buzz right now about generative AI and what impact it might have on businesses. But look beyond the hype and high-profile deals like the one between OpenAI and PwC last week, and you’ll see that the world is already years into using customer-facing, no-code AI tools for extracting information and working faster.
Now, one of the earlier movers in this space — Sirion Labs, a specialist in contracts — is acquiring another enterprise AI pioneer — Eigen Technologies, which has focused to date on parsing and extracting insights and data from documents in verticals like insurance, finance and legal.
The deal underscores not just the opportunity around increasing demand for AI in the B2B market, but also a wider trend in enterprise IT. Currently, end users are opting for simpler, one-stop-shops rather than taking on multiple point solutions for their IT needs, leading to consolidation among those building the latter.
Eigen and Sirion are not disclosing the financial terms of the deal, but below is relevant context that tells some of the story.
London-based Eigen is led and co-founded by Dr Lewis Liu, an Oxford PhD who studied both art and physics. While still a student, Liu invented a new X-ray laser, and some of that math was then reapplied to the algorithms that Eigen built to extract and understand natural language.
You might describe what it has been doing for years as generative AI, although that is not the term the company uses. The startup’s no-code tools summarize and extract meaning from lengthy and typically unstructured and arcane documents; Eigen built its own dataset and intelligence engine to underpin it. It’s aimed at non-technical users — no data scientists needed to implement and use it — and typical use cases might be basic search, insights, summaries and for compliance purposes.
Eigen has raised just over $80 million to date, and the last valuation we have for it was from 2019, when it raised $37 million and was valued at around $170 million. Its investors included Goldman Sachs (a strategic backer) and Dawn Capital.
Liu said prior to this deal, Eigen had “several offers on the table, including term sheets to continue financing the business.” That means Eigen was under some pressure: it was getting close to the end of its runway and needed to make a choice. But with a pretty impressive customer book (it works with a number of very large banks and other big enterprise names), it had other acquisition offers on the table, and funding offers — although, in what continues to be a tough market for startups looking for growth rounds, even AI startups — funding terms might look more tricky right now. Sirion came out as the best of the selection.
Liu said that the companies were already partnering on business deals — because of how enterprises are buying IT — and the two appeared to have a “joint vision.” Liu will become the company’s chief AI officer leading a new hub in London.
For its part, Sirion was founded out of India and has focused its attention to date on contracts, specifically the application of AI to the area of contract lifecycle management. Its tools are also genAI-ish: you can use conversational queries to search and extract information, similar to Eigen; alongside that, it also provides AI to parse contracts to make sure that users are clear on the terms, to figure out total contract value, and to identify any potential loopholes. It currently builds customizations and “small language models” but also integrates with the those building larger foundational LLM models to power its tools.
Sirion’s last round, a Series D, was initially $85 million but then ultimately closed out at $110 million, with its backers including Peak XV (formerly Sequoia India) and Tiger Global.
We have confirmed that Sirion is now valued at around $1 billion — a figure that Sirion had not previously disclosed — and that it still has much of that Series D still in the bank. It says that it works with over 250 large enterprises manages more than 7 million contracts worth $800 billion.
Sirion is not yet profitable, and it has between one and two years of runway left, depending on how exuberant and acquisitive it’s feeling. Acquisitions are on the table, in any case. The main idea, CEO and founder Ajay Agrawal said in an interview, is that it is looking for “tech-led” additions, not customer roll-ups.
“I think that the landscape over the next 18 to 24 months will be in a consolidation mindset [in our space], and frankly, there are so many lateral areas for AI… we will be talking,” he said.
On the other side, it sounds like Sirion itself is also talking about M&A upstream. One big target buyer might be one of the larger system of record players. SAP currently is working with Icertis, Salesforce has a deal with Ironclad, and Oracle is Sirion’s main partner. There will be more alliances like these, with some eventually tipping into M&A as part of that wider consolidation trend, Agrawal predicted.
“We get inbound interest from everyone,” he said. Watch this space.
