Austin's SparkCognition raises $123 million, tops $1 billion in value

SparkCognition — Austin's latest "unicorn" company with a valuation of more than $1 billion — is kicking off a new wave of expansion that includes hiring dozens of workers.

The fast-growing artificial intelligence company said Tuesday that it has raised $123 million in its latest funding round, which values it at more than $1.4 billion.

The deal was led by new and existing investors, including March Capital, Doha Venture Capital, B. Riley Venture Capital, AEI Horizon X, Temasek, Alan Howard, and Peter Löscher.

Founded by tech industry veteran Amir Husain in 2013, SparkCognition has raised a total of $300 million. The company said it will use the new infusion to accelerate sales and marketing and expand research and development.

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SparkCognition has developed machine-learning technology to predict when a customer's systems might fail or be hacked. The technology works by modeling physical and virtual assets and continuously learning from the data.

The company has clients in industries including defense, finance, manufacturing, automotive, telecommunications and energy. Customers include Boeing, Hitachi High-Technologies and Aker BP.

“This additional capital will enable us to deepen our subject matter expertise, enhance our patent portfolio, and accelerate the diversity of problems we solve for customers, maximizing their return on investment," Husain said.

SparkCognition has 300 employees globally, with about 70% based in Austin. The company said it plans to add 150 employees this year, and that it is listing some of the positions with the option to work remotely.

The privately held company said the new financing follows a record year of growth, with revenue up 90% year over year. SparkCognition completed three acquisitions in 2021, which it said enabled it to break into new markets.

Among its purchases was California-based Ensemble Energy, which expanded SparkCognition's technology offerings in the energy sector. The company said the acquisition will help it create an AI-enabled management platform focused on clean energy. Terms of the deal weren't disclosed.

“They are at the front of this AI tsunami — helping businesses address their most critical challenges and enable digital transformation," said Sumant Mandal, managing director at March Capital Partners.

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The SparkCognition funding round is among several significant funding deals for Austin companies early in 2022.

Wheel, a health technology startup that offers a variety of virtual care tools, this month raised $150 million to continue its growth.

Meanwhile, Atmosphere said it has raised $100 million to grow its streaming entertainment service. The startup, a Chive Media Group spinoff, said it planned to hire hundreds of new employees with the help of the funding.

In addition, bootmaker Tecovas said it raised $56 million to expand its brand. The company, which started as an online seller of handmade boots, is looking to grow by adding five to seven new retail stores, and expanding its offerings to include apparel, accessories and other footwear. The company already owns 20 stores in 10 states, including a South Congress Avenue location in Austin.