According to an Allied Market Research report, the global enterprise AI market is estimated to grow at 35% CAGR to $53.06 billion by 2026 from $4.68 billion in 2018. Redwood City-based C3.ai is a leading player in the sector.
C3.ai was set up in 2009 by entrepreneur Tom Siebel and Patricia House to become an enterprise AI software provider that can help organizations accelerate their digital transformation journey. Its AI suite provides comprehensive services that help organizations build enterprise-scale AI applications more efficiently and cost-effectively.
Prior to setting up C3.ai, Tom Siebel had founded Siebel Systems that was sold to Oracle in 2006. After the sale, Tom became an investor and a philanthropist. In the next three years, he had set up C3 Energy that focused on a software to help electric grids manage energy flows to homes. A year later though, Tom was involved in an accident that resulted in a two-year long recovery period. By the time that Tom regained his health, macro conditions had changed. Reducing oil prices coupled with the economic meltdown almost sent C3 Energy to bankruptcy.
But Tom did not give up. Over the next two years, he restructured the organizations and focused efforts on collecting and analyzing data from sensors and industrial machines. Even before IoT became a thing, Tom was building a platform to support it. In 2016, C3 Energy was rebranded as C3.ai as it became a full-stack IoT cloud-based development platform provider. It no longer catered only to the energy sector and had diversified to manufacturing, aerospace and defense, transportation, healthcare, retail, commercial services, and public-sector enterprises.
Today, its AI algorithms are available on Amazon, Microsoft, and Google’s cloud platforms. It offers large groups solutions for predictive maintenance, energy management, supply chain optimization, and fraud detection while also selling IoT solutions for collecting sensor data. It provides prebuilt, configurable, high-value AI applications for enterprise wide deployment.
C3.ai is privately held and does not disclose detailed financials. It has raised $228.5 million in funding from investors including Breyer Capital, InterWest Partners, Sutter Hill Ventures, TPG Growth, Thomas Siebel, Wildcat Venture Partners, Pat House, Bolt Innovation Group, and Constellation Technology Ventures. Its last round of funding was held in January 2018, when it raised $100 million at an undisclosed valuation. An earlier round held in March 2017 had valued the company at $1.4 billion. A 2019 report estimates the company’s valuation at $1.8 billion. Unlike other unicorns, C3.ai has taken its time to join the club.
C3.ai is now focusing on international expansion. Last year, it announced plans to expand its footprint in France. It already has significant customers based out of Europe such as ENGIE in France, Enel in Italy, and Royal Dutch Shell in the Netherlands. It is targeting a share of 40% revenues from Europe, 40% from the US and 20% from Asia within three to five years. To deliver that, it is looking at making Paris its European headquarters.
It is also expanding its partner network to drive market growth. Last November, it announced a partnership with Microsoft and energy industry tech company Baker Hughes. As part of the tie-up, the three companies will work together to bring enterprise AI technology to the energy industry via the Azure cloud computing platform. The alliance would allow customers to streamline the adoption of AI to help organizations address issues like inventory, energy management, predictive maintenance, and equipment reliability. The trio believe that Microsoft’s global reach and horizontal cloud platform, coupled with Baker Hughes’ technology domain expertise and C3.ai’s industrial AI capabilities will help improve business operations and better serve customers with AI-enabled products and services.