McKinsey buys start-up Iguazio, its first Israeli acquisition

McKinsey & Co. acquired Israeli real-time data analytics startup Iguazio for an undisclosed sum, marking the international consulting firm’s first acquisition in Israel.

McKinsey plans to use Iguazio’s machine learning platform to enable companies and organizations to deploy and manage artificial intelligence (AI) applications and integrate them into real-time decision making across all areas of their business. costs and increase your revenues.

Using Iguazio’s technology, QuantumBlack, the consultancy’s AI arm, will be able to “provide clients with industry-specific AI solutions that are five times more productive, eight times faster to go from proof-of-concept to production, and twice as reliable ,” McKinsey said in a statement.

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“This is an important investment for McKinsey, both in technology and in the country, because we believe in Israel’s potential, both in terms of AI, that is, in terms of technology, and in terms of human capital”, he declared to the Israeli times Ben Ellencweig, Senior Partner at McKinsey and Global Head of Alliances and Acquisitions at QuantumBlack. “This is our first product acquisition, i.e. technology acquisition, after QuantumBlack a few years ago. »

Founded in 2014, Iguazio has developed a machine learning platform that enables companies to develop, deploy and manage AI applications at scale and in real time. The startup has raised more than $70 million in funding backed by investors including Pitango Venture Capital, Verizon Ventures, Robert Bosch Venture Capital GmbH, CME Ventures, Magma Venture Partners, Jerusalem Venture Partners, Dell Technologies and Samsung.

“We were already studying the extent to which McKinsey could strengthen its technological innovation capacity about a year ago. We reached out to more than 1,000 companies across the world, in Israel and beyond, and Iguazio struck us as the best fit,” said Ellencweig.

Ben Ellencweig, senior partner at McKinsey. (Credit: McKinsey)

Alexander Sukharevsky, senior partner and global co-head of QuantumBlack, said the deal comes at a time when there is “a lot of turmoil globally where past data is not necessarily relevant and models must change due to tax issues, financial pressures and regulatory. »

Over the past decade, more than $490 billion has been invested in AI by large companies and organizations around the world, yet only one in 10 projects has moved from the lab stage to the enterprise, according to a McKinsey study.

“We are committed to maximizing the capabilities of AI to help our customers drive sustainable and inclusive growth. And since today 90% of AI projects remain in labs, we see a huge opportunity here,” said Sukharevsky.

With this acquisition, QuantumBlack makes Israel, with its Iguazio-based team of more than 70 data and AI experts, its fifth global R&D center. Center that McKinsey plans to develop and expand in the coming years, the company said. Iguazio employees will work with QuantumBlack data scientists and machine learning engineers around the world on various projects such as improving efficiency and reducing emissions through AI.

“McKinsey’s experience, along with QuantumBlack’s technology stack and expertise, now combined with Iguazio, is the ultimate solution for companies looking to scale AI initiatives in a way that has a direct impact on their bottom line,” said Asaf Somekh, co-founder and CEO of Iguazio. “We already serve more than 20 customers around the world, including financial institutions, airlines, airports and environmental companies in the US, Asia and Europe. »

“Now we will have access to the biggest customers in the world,” added Somekh.

As for the future, Ellencweig underlined that this acquisition marks just the “beginning of a journey. »

“It’s exciting to bring Startup Nation into the broader McKinsey group and our global partnerships that span 60 countries,” said Ellencweig. “Israel has a super vibrant startup ecosystem and we have a message for all startups there: we would like to build and expand our ecosystem through other partnerships and other acquisition partnerships. »

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