Chooch, a company that tracks objects and actions using artificial intelligence, could pursue a public listing “soon” or in a few years, said Michael Liou, vice president of strategy and growth.
The San Mateo, California-based company declined to speculate on whether it would pursue a traditional listing, direct listing or a listing via a merger with a special-purpose acquisition company (SPAC), saying that it was premature to comment due to the changing landscape of listing processes.
Liou pointed to recent volatile IPOs including C3.ai [NYSE:AI], which surged and then crashed and Robinhood [NASDAQ:HOOD], which fell on its first day and then surged by more than 20%.
Chooch has not been approached by a SPAC, Liou said, adding that the SPAC market is like “the wild west” and flooded with pre-acquisition SPACs.
While some SPACs have been “quite successful,” investors in other blank-check companies are likely “really burning mad” with troubled targets like Nikola [NASDAQ:NKLA], whose former CEO was recently indicted on securities fraud charges.
In addition to being a venture capitalist, Liou was an early investor in numerous companies that went public recently including Robinhood, Wish [NASDAQ:WISH] and Didi [NYSE:DIDI], he said.
Chooch, founded in 2015, uses AI to track objects for industries including healthcare, defense and energy, the executive said. To add capabilities, the companies “always” works with partners including original equipment manufacturers (OEMs), systems integrators (SIs), and virtual memory systems (VMS) depending on use cases, he added.
Its technology can be used in operating rooms or to detect warnings for energy sites that could fail, Liou said. Chooch’s customers operate on a partner ecosystem, he added.
The company can create models in a matter of weeks instead of months like other companies, Liou said. During the interview, the executive created and demonstrated a data set of syringes that showed the computer identifying syringes within a mix of other objects.
Chooch reaches markets in Europe through partners, such as its presence in the UK through Pendragon, a car reseller that uses Chooch’s technology to improve user uploaded car images, Liou said. The company has received frequent inbound interest from investors, partners and customers in past years from regions like Japan, Latin America and EMEA, he added. Liou anticipates that the company will begin considering expanding strategically once the company gets “some good momentum,” adding that its international push would rely on partnerships.
In November 2020, Chooch raised a USD 20m Series A round led by Vickers Venture Partners with additional participation from Streamlined Ventures, 212, Alumni Ventures Group and Waterman Ventures. The cash from the Series A round gives the company “years of runway” outside of the typical 12-18 months between raises, Liou said. The company hopes to improve its free cash flow with revenue from clients and eventually to be cash flow breakeven and essentially self-funded, he added.
Although a capital raise isn’t Chooch’s highest priority right now, the company could decide to raise “a little bit more” capital at a higher valuation, the executive said, adding that he has received inbound interest from corporate venture capitalists who are interested in participating in a capital raise before a potential IPO.
Broad competitors in the space include Clarifai, Matroid and Dori AI, the executive said. AnyVision, Deep North and C3.ai are niche competitors in the facial recognition, retail and manufacturing and utilities spaces, Liou added.
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