James F. Kenefick - Azafran Capital INSIGHTS Vol. 10 by James F. Kenefick

YOUR EYE ON INNOVATIVE MACHINE LEARNING SOLVING REAL WORLD PROBLEMS

Azafran Capital Partners

INSIGHTS CES 2020 - It’s a Wrap! Cutting through the noise, team Azafran hit the ground running @ CES - hosting panels, meeting new startups and updating with our Fund One portfolio companies Whew. That’s about all our team had left after a full week at CES. In between meetings with partners, existing portfolio companies and just taking in as much as possible of the new and emerging tech, a highlight for us and our main reason for being at the show, centered around Eureka Park. In addition to being one of the world’s largest conferences, CES also happens to be the world’s largest startup event, with more than 1,200 companies from 46 countries featured within Eureka Park. Our team spent a full two days in EP, combing the floor for disruptive innovations, founders, and companies that fall into the Azafran Investment Thesis. While we might be biased, Eureka Park is the true heartbeat of the conference. The floor at Eureka was divided a good part by host country, with France being the obvious winner in terms of companies brought and overall footprint & a number of the companies we are adding to our consideration are based in France. In addition to meeting new startups, we were excited to spend time getting updates from and making connections for some of our key Seed Fund portfolio companies like Yobe and Aspinity as well.

Azafran Partners, Martin Fisher (left) and James Kenefick, getting a demo of latest robotics and AI tech in the Eureka Park startup pavilion at CES 2020

One of the larger “booths” @ CES 2020 was the Google Pavillion, which mostly showcased their in home array of products integrated with Google Voice - another leading proof point of the Azafran Thesis.

Overall, from our time spent in other parts of the show, we saw a maturation of many technologies but not many game changing, or new innovations from the incumbents or larger, more established companies. As it relates to the Azafran Thesis, focused on voice, acoustics and imagery as the inputs and modalities of the future, it is clear the world of technology has moved this way, from automobiles to homes and the enterprise, it was hard to find one major product in the hall that is not or has not incorporated one or more of these modalities.

issue TEN issue ten FOCUS At Azafran Capital Partners, we are an early stage venture fund investing in companies ($2M to $8M) that are using deep learning and machine learning, emphasizing voice, acoustics and imagery datasets in the health, wellness, IoT / automation and enterprise spaces. Issue Ten of INSIGHTS focuses on this year’s CES conference - with over 20,000 product debuts unveiling the future of technology. More than 4,400 exhibiting companies launched their latest tech products to some 170,000 attendees across more than 2.9 million net square feet of exhibit space. From global tech brands to pioneering startups, the innovation at CES 2020

We see 2020 as the year that AI goes mainstream in business. We fundamentally believe AI is about augmenting intelligence and making human decision-making more efficient and effective.” -

Bob Lord, Senior Vice President of IBM’s cognitive applications and developer ecosystems division

“CES has the unique ability for startups and young companies to get exposure to major global brands. The opportunities for venture funding and growth are incredible here.” -

Mara Lewis, Co-Founder and CEO, ID8 Innovation; member, CTA Board of Industry Leaders

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from the ROAD Highlights from Conferences, Pitch Days, Openings and other Events around the U.S. and World Standard procedure and part of the Azafran team process - we are out on the front lines every week, attending and speaking at conferences, events, pitch days, openings. We are all seasoned entrepreneurs, operators and start up geeks so this part comes easy for us. It also is crucial to delivering on the Azafran investment thesis, one more way we are staying on top of the latest companies, partners, and tech that is hitting the street, and most importantly, helping us to find the best companies that fit our thesis.

Upcoming Events and More From the Road After a debrief and processing of all the connections made from CES, the Azafran team will be back on the road for much of Q1 2020. We have a host of events here in our NYC backyard, plus many other events including South by Southwest in Austin and Global 2020 in Silicon Valley in February. As always, please let us know if you would like to schedule a meetup as we are constantly criss-crossing the globe and it won’t be long before we’re in your corner. Please email us at insights@azafranpartners.com to setup a call or meeting.

Azafran Capital Managing Partner, James F. Kenefick, (left) leading a panel YPO Innovation side event @ CES 2020, which included Ken Sutton, CEO of Azafran Fund One portfolio company, Yobe

YPO Innovation Summit @ CES Las Vegas, NV Azafran managing partner, James Kenefick was out front leading the first panel kicking off the YPO Innovation Summit the day before CES even started. The panel included Ken Sutton of CEO and Co-founder of Azafran Fund One portfolio company, Yobe, as well as other innovative startup CEOs, including Barry Oberholzer of Sword. The panel explored a wide variety of topics including their amazing tech and innovations, to fundraising and general startup challenges in today’s environment. It was a packed house of YPO’ers, who had much to learn from these visionary leaders.

Fil Rouge Capital Demo Day

One of the many amazing auto and auto tech companies on display at CES, Lightyear One is a solar powered, electric car which charges itself via ultra strong solar panels on the car

Zagreb, Croatia Azafran Associate Daniel Nikic was on hand for the annual Fil Rouge Demo Day, an exclusive, invite-only event for active and accredited investors and partners and is the culmination of intense three month Fil Rouge Capital Accelerator program and the time for each startup to showcase the achievements made throughout the program. During this day, companies, mentors, investors, and alumni come together and watch the 3 minute pitches from the accelerator’s latest batch. The startups got the chance to ensure the next round of investment from the most renowned investors from the CEE region and beyond, and also to network with investors who may be able to provide them with additional capital in the future. Azafran INSIGHTS © Azafran Capital Partners 2020 - All Rights Reserved

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CES Startups - Use Cases

market PREDICTIONS

As discussed in the previous page, we visited with many promising and innovative startups focused in our sweet spot of voice, acoustics, imagery and other innovative deep science solutions. Following are examples and a cross section of the companies and solutions we are considering developing into the Azafran pipeline: ●

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Software for remote autonomous flight of inexpensive off-the-shelf drones for customers in farming, mining, construction, public safety, manufacturing facilities, power plants etc.; Artificial intelligence agronomic solutions based on real-time video analysis and deep learning; Unique system providing a solution for precise and comprehensive quality control. It detects all defects in a product and simultaneously checks for configuration mismatches; Developed a set of cutting edge technologies to enable an empathetic connection between the customer and the brand to optimize the conversion rate and then increase sales; Develop humanoid service robots specializing in interaction and manipulation of objects. Reachy is an open source interactive robot to explore real-world applications. Speech Graphics takes conversation, delivered by human or AI, to create a highly emotional, graphical avatar in real time, putting a face to the voice of intelligent virtual assistants.

CES 2020: What’s Driving Innovation 2020 will be the year we start to take connectivity to the next level, and by the end of the decade, I fully expect us to take it for granted in the same way we take electricity for granted. It’s reliable, and always there when we need it. There are numerous enablers that are helping to make seamless connectivity table stakes, but probably the most talked about right now are 5G and Wi-Fi 6 which promise to deliver zero latency, along with unprecedented speeds and bandwidth. These are all game changers for smart cars, smart cities, and indeed, smart manufacturing. As technology becomes immersive and ambient, so does the use of robotics and automation, bringing into focus the relationship between humans and machines. We’re moving from a world where technology is a tool to be used as we need to it into the era of collaborative technology, where we use robotics and automation to increase our speed, strength, and ability to compute complexity almost instantly. This changing relationship with robotics and automation creates societal challenges but offers some amazing benefits that take humans to new heights.”

NEWSWORTHY…

Source: Dave Evans CES 2020: What’s Driving Innovation, Forbes

Key Themes at CES 2020 CES 2020 featured the entire spectrum of transformative technology that will redefine markets and shift business models, including: Artificial Intelligence AI was dominant throughout the show floor and will be a ‘key ingredient technology’ over the next decade. Companies debuted their latest AI solutions, including Brunswick, Doosan, John Deere and Kyocera. 5G and Mobile Connectivity CES is the only show where the entire 5G ecosystem – the backbone for connectivity, transportation, augmented and virtual reality, digital health and more – comes together. Carriers and mobile operators, such as Verizon, Sprint, AT&T, Nokia and Ericsson, demonstrated the latest advancements in 5G’s speed, reliability and efficiency. Tech for Good

The nerve center of CES, startup pavillion Eureka Park where the Azafran team spent two days.

Innovative technologies launched at CES that will change lives and improve our world. Digital health technologies were a major theme, with advancements in digital therapeutics, wearables and remote patient monitoring as digital health addresses real world issues like opioid dependence, mental illness and chronic disease. The Health & Wellness category saw an increase of nearly 25% with more than 135 exhibiting companies at CES 2020, including Humetrix and InBody. The Smart Cities exhibit area expanded by nearly 25% over 2019, with companies and organizations including the Department of Transportation, Hitachi and Siemens, highlighting products that will revitalize economies and help communities survive and thrive.

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A Word With Ken Yobe CEO Ken Sutton and Azafran’s Matt Bauer sat down for a chat at CES 2020, following is a short excerpt of the interview. Yobe has created intelligent software that can accurately identify and then track a voice’s DNA in any auditory environment. This allows Yobe’s tech to effectively separate voice of interest from background noise and other voices. MB: What is the biggest shift at Yobe from last year’s CES to this year? KS: Well, what hasn’t changed is that we exist in a constantly changing market, both in tech and perspective, as well as the fact that we are competing with orgs that have unlimited resources. Last year, we were focused on getting our complex AI algorithms onto customer’s boards to demo our technology. The demo on their platform became the proof point that let us show you how the tech worked. At CES this year, the viability and questions of whether it works are in the rearview mirror. Our conversations this year are how can we apply our science to the customer’s voice ecosystem. The market has become more educated on the unique challenges associated with voice and can now be more deliberate when looking at solutions. As our solution has matured so has the evidence supporting the disruptiveness of our technology.

Ken Sutton, CEO and Co-founder, Yobe, Inc.

MB: How has your approach changed over this same timeframe? KS: One definite shift in strategy is that we have transformed from selling a widget into selling a “solution”. In effect, we are agnostic to the platform that lies behind our solution, whether it be IBM, Amazon, or Google - we see ourselves more as interchangeable Lego blocks of intelligent algorithms. One example is our pilot with the FBI where IBM, who has a great deal of traction in the security and law enforcement space, is the backend ASR processing platform with Yobe providing the audio front end. IBM allows us to offer the FBI a suite of audio services that would not be possible without our solution on the front end. We see ourselves as the Lincoln Labs [MIT] for voice and our goal now is to be perceived as the voice consultants of choice when looking for effective voice UI capabilities. We have compartmentalized the solution, so that problems solved for one vertical can be ported/used for others. We are making the argument to become the defacto tech for voice using AI, much like what Dolby accomplished in the sound production/replay space. MB: As one of our Fund One portfolio companies, what do you like best about the Azafran team and approach? KS: What you get with Azafran is the humanistic piece - most VCs talk about it but they don’t live it in how they deal with investments. The Azafran team are operators at heart, and how they deal with founders is slightly different – it is a true two-way street.

Feedback, going forward Our intention is to use INSIGHTS as a vehicle to open a dialogue with each of you and we strongly encourage and welcome your feedback. We’ve made it simple, please let us know your comments by emailing us at insights@azafranpartners.com or visit our website at AzafranCapitalPartners.com and there are other options to connect there and in the footer below as well.

voice-tech INDUSTRY At a Glance: Top 5 Markets & Global

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