Why Intel Is Investing $350 Million In A Two-Year-Old Deep Learning Company That Employs Less Than 50 People

Intel is taking steps to expand its horizon from PC chip manufacturing to include a bigger chunk of a data business center. To do this, Intel has purchased a machine learning startup, which is two-years-old and employs just 48 people.

Business Insider notes that Intel did not fully disclose the amount it invested in purchasing the startup, Nervana Systems. However, it is estimated that the sale was worth an upwards value of $350 million. While it might seem like a lot of money to spend for a relatively small company, the personnel and technology found within the group is impressive.

Reportedly, Nervana provides high-end technology and is lead by Naveen Rao. Meanwhile, Rao is a former Qualcomm researcher.

As mentioned earlier, the purchase of Nervana is a move for Intel to further enlarge its hold on the data center market. Logically, this is a good move for the company, as the PC chip industry has been decreasing in size. The company is also shifting a large amount of its focus on investing in the Internet Of Things.

Currently, Intel already has a hold on plenty of gadgets and machines that are connected to the Internet. Partnering up with Nervana to deepen the company's understanding of data and how each of the devices can connect together makes complete sense.

As Recode adds, Intel's Vice President, Jason Waxman, released a statement justifying the shift. Waxman believes that the focus on artificial intelligence will eventually lead to the decline of cloud computing. Naturally, machine learning is a step into that direction.

"There is far more data being given off by these machines than people can possibly sift through," Waxman said.

On the side of Nervana, Rao said that the deal was never about getting more capital. In fact, he shared that this specific issue should never have been a problem. It was, instead, about getting access that the company may not have gotten before. According to Rao, "We [now] have access to technology we'd never dream about."

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