Perhaps rightly, there has long been a perception that Google-owned Deepmind has been the most aggressive in hoovering up a lot of the U.K.’s best talent in artificial intelligence, but now Facebook appears to be turning its eye to the country.
TechCrunch understands that the social network behemoth is acquiring London-based Bloomsbury AI, a startup that has built natural language processing (NLP) technology to help machines answer questions based on information gleaned from documents. According to sources, Facebook plans to deploy the company’s team and tech to work on combatting fake news and to tackle other content issues.
Bloomsbury is an alumni of Entrepreneur First, the company builder that invests in technical and domain expertise talent and helps those individuals start companies. The startup is also backed by Fly.VC, Seedcamp, IQ Capital, UCL Technology Fund, and the U.K. tax payer-funded London Co-investment Fund.
William Tunstall-Pedoe, who was instrumental in the development of Amazon’s AI-powered digital assistant Alexa, is also an angel investor in Bloomsbury.
Multiple sources say Facebook is paying between $23 million and $30 million to acquire Bloomsbury AI, in a deal that will see a mixture of cash and stock change hands. In one scenario, the startup’s investors will receive around $5.5 million, with Bloomsbury’s founding team in line for the remaining $17.5 million, paid in restricted Facebook stock. Either way, this represents a modest return for the bulk of investors, although EF — given that it invests pre-seed — is likely to have had a larger multiple.
Given the price and the stage Bloomsbury AI were at, the acquisition also has more than a whiff of acqui-hire to it, although there is some IP in the deal. I understand from one source that Bloomsbury AI’s CTO/Head of Research, Sebastian Riedel, was the biggest draw. He is considered to be a leading expert in the area of NLP, and is a professor at UCL. According to his LinkedIn, he also co-founded and is an advisor to Factmata, the U.K. startup that purports to have developed tools to help brands combat “fake news”.
Which brings us to the possible reason for why Facebook is acquiring Bloomsbury AI, a startup that I’m told was phenomenally strong when viewed as a group of researchers, but less so when it comes to getting a commercially viable product out of the door. The company’s sole product is an API called Cape that lets developers add question & answer functionality to websites and other documents.
Indeed, a source who claims to have some knowledge of Facebook’s intentions says the U.S. tech giant may be planning to put the Bloomsbury AI team on the task of helping it develop technology to fight fake news on the platform and solve other aspects of its glaring moderation problem.
Other areas of Facebook’s product that might benefit from the Q&A technology that powers Cape include being used as a workplace tool for companies to discover content in documents, or on Facebook’s consumer offering as a way of significantly improving its search and knowledge-base functionality.
It is also understood that Bloomsbury AI being based in London was a factor, as Facebook aims to have an AI presence in the U.K. capital city and is thought to be sourcing further acquisitions here.
Multiple sources have confirmed the deal to us, although Facebook declined to comment.
Update: Facebook has now confirmed it has acquired the team behind Bloomsbury AI.
Additional reporting by Ingrid Lunden