Toronto startup Arteria AI has raised US$11-million in its first round of funding since spinning out of Deloitte LLP last year, as it plans to strengthen the sales and data-science teams behind its artificial-intelligence services for drafting, negotiating and reviewing contracts.
Co-founder Shelby Austin joined Deloitte in 2014 when it acquired a business she’d started to make document reviews easier for law firms before litigation or deals. She soon became the head of the global consulting firm’s AI practice called Omnia – which by 2018 had launched ambitious plans to hire people by the hundreds as the corporate world began embracing AI technology.
One flagship Omnia success was called dTrax, the contract-management service that Ms. Austin decided last year could benefit from being a stand-alone company with third-party investment.
In October, that became Arteria. And on Monday, Ms. Austin revealed that its first outside investment would be led by Toronto’s Information Venture Partners and London- and New York-based Illuminate Financial Management – both of which specialize in technologies that benefit major financial-services companies.
“I thought that down the road we’d want financing, but I didn’t think it would happen this quickly,” said Ms. Austin, a startup executive who happily speaks off-the-cuff. “But these funds pointed out that velocity for a business like ours is quite important – and that resounded quite strongly.”
Arteria’s product largely works with capital-markets and treasury contracts that require complex negotiations. Its clients are primarily in financial services, and though the company declined to name them, it said that many are global in scale with headquarters around the world.
Using AI techniques such as natural language processing, Arteria helps lawyers both break down contracts to be easily searchable as well as to help automate first drafts. It can also help negotiate contracts with the help of playbooks, and track details through the life of contract terms to help parties understand when legal issues might arise.
When Information Venture Partners caught wind of Arteria, the company took its leadership by surprise, said Robert Antoniades, the fund’s co-founder and general partner. Other contract-technology companies he’d seen were too broad for the fund’s financial-services mandate, so his team wasn’t interested in that world – until he met Ms. Austin. “She tied it all together for us.”
Mr. Antoniades sees potential in expanding Arteria’s use cases to other parts of the financial-services world, such as insurance. But down the road, he can see the company casting an even wider net.
Illuminate founding partner Mark Whitcroft said he first heard about Arteria from one of his banking clients. “Although it’s an early investment, they have a live product,” he said. “It’s the depth and breadth of the team, and the quality, which are really important when you’re investing early.”
Mr. Whitcroft praised the leadership of Ms. Austin, who in turn praised the team she has built to a group of 40 from the original 17 employees who joined her from Deloitte. That includes two former Deloitte colleagues as co-founders – chief technology officer Jonathan Wong and chief revenue officer Abrar Huq.
Ms. Austin said the new capital will help expand the team further, while helping the company set up a subsidiary in Britain and an office in New York, where many of the company’s financial-services clients are headquartered.
Despite the rapid expansion, she said she remains committed to building out Canada as a major market for AI and tech. “I am on the mission to build a great, iconic Canadian company,” said Ms. Austin, who remains the company’s majority owner. (Though Deloitte originally kept a minority 25-per-cent ownership of Arteria, Ms. Austin said the firm no longer holds a stake.)
The financing round was supported by Toronto-based seed fund Golden Ventures and StandUp Ventures, which is one of just a handful of Canadian tech funds that pledges to invest in female-led companies.
StandUp managing director Michelle McBane called Ms. Austin a fierce leader with a knack for persuading both customers and potential employees to join the Arteria fold. “It’s clear that she’s just got that superstar credibility to her,” Ms. McBane said.
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