Explosion Raises $6M to Scale Machine Learning Platform

Explosion AI Secures $6 Million in Series A Funding

Explosion, a firm specializing in the integration of an open-source machine learning library with a suite of commercial developer tools, has announced the completion of a $6 million Series A funding round. This investment values the company at $120 million.

SignalFire spearheaded the round, with the company disclosing that the current investment constitutes 5% of its overall valuation.

Focus on Developer Productivity in AI

“Explosion’s core identity is that of a software company dedicated to crafting developer tools for artificial intelligence, machine learning, and natural language processing,” explained Ines Montani, co-founder and CEO. “Our primary objective is to enhance developer productivity and concentration on natural language processing tasks.”

This includes facilitating the comprehension of extensive textual data and the training of machine learning models to automate related processes.

Origins and Growth of the Company

The company’s inception dates back to 2016, when Montani connected with her co-founder, Matthew Honnibal, in Berlin. Honnibal was then developing the spaCy open-source machine learning library.

To date, this open-source project has amassed over 40 million downloads.

The Introduction of Prodigy

In 2017, they introduced Prodigy, a commercial offering designed for generating data to train machine learning models.

“Machine learning relies on both code and data; therefore, maximizing the potential of these technologies often necessitates training models and constructing bespoke systems,” Montani stated. “The most significant value lies in addressing highly specific problems unique to your business and objectives.”

She further noted that the creation of training data for these models had historically received insufficient attention.

Prodigy Teams: Collaborative Data Annotation

The company’s next venture is Prodigy Teams, a key driver behind this investment round.

“Prodigy Teams is a hosted service that incorporates user management and collaboration functionalities into Prodigy,” Montani clarified. “It allows users to operate within the cloud environment without sacrificing the data privacy that is highly valued by Prodigy users.”

Data remains on the customer’s private cluster or private cloud, while management features are accessed through the public cloud service.

Current User Base and Team Expansion

Currently, 500 companies utilize Prodigy, including prominent organizations like Microsoft and Bayer, alongside a substantial community of millions of open-source users.

The company has grown from an initial team of six to 17 employees, with plans to reach 20 by the end of the year.

A Perspective on Diversity in Hiring

Montani suggests that focusing excessively on diversity during the hiring process may indicate an underlying issue.

“If a company consists predominantly of a homogenous group, it’s unsurprising if attracting a more diverse pool of candidates proves challenging,” she explained. “Our approach centers on recruiting skilled individuals, who are often inherently diverse.”

Independent Growth and Profitability

She emphasized that Explosion has deliberately deviated from the conventional startup trajectory.

“We did not seek external investment until now, prioritizing organic team growth and maintaining profitability and independence,” she said.

The Importance of Supporting Open Source

Beyond the financial aspect, Montani underscored the necessity of securing an investor who appreciates and supports the open-source foundation of the business.

“Open source thrives on a community of users, customers, and contributors – real people who deserve respect and are not merely components of a startup strategy,” she asserted.

“It’s crucial that open source remains central to our company, even as we accept capital to develop new products, and we are unwilling to compromise on this principle.”