Updated 25.4.24 after Nvidia officially announced it is acquiring Run:ai
Omri Geller from Ramat Hasharon and Ronen Dar from Jerusalem met at Tel Aviv University when they were studying for their doctorates in electrical engineering. They had both 'fallen in love' with the potential of AI, which was part of their research. Now they are under the spotlight as the founders of AI infrastructure orchestration and management company Run:ai, which is in advanced talks to be acquired by Nvidia.
According to various sources, the US chip giant, which acquired Israeli company Mellanox for $6.9 billion in 2019, could pay hundreds of millions of dollars for Geller and Dar's company if the deal is completed. Run:ai is headquartered in Tel Aviv's Ha'arba'ah Street and has 130 employees, including 80 in Israel.
Several days before reports emerged of the potential acquisition, Geller and Dar spoke about the founding of the company, the strong bond between them and their work at Apple and in the Prime Minister's Office, and their research into AI long before it became a market trend, and the turning point, which led them to understand that the future had arrived.
Financing round at $388 million valuation
Before ChatGPT became part of the vocabulary of the public at large, only those in the know, such as academics, were acquainted with AI's capabilities. Several years after they first met, Geller and Dar founded Run:ai in 2018 to realize the potential of AI.
Run:ai has developed a program for the optimization of AI infrastructures of organizations and companies and in particular accelerating the performance of GPU (graphics processing unit), the AI processors of chip giant Nvidia. So it's probably no surprise that the chip giant, which over the past year has become the hottest company on the global tech scene, is now in talks to buy the Israeli company.
Although the exact sum of the budding acquisition is not known, estimates are that Nvidia will pay hundreds of millions of dollar. In 2022, Run:ai raised $75 million at a valuation of $388 million, according to PitchBook. The stakes held by the founders are not known.
Dar (42) and Geller (35) recount that they connected with each other immediately. "We both studied electrical engineering, I did my B.Sc. and M.Sc at Tel Aviv University, and during my doctorate I met Omri. We were under the same supervisor and worked together a lot," Dar tells "Globes."
"At the same time, I was working at Intel, and then at a startup called Anobit, which was developing chips for storage systems. The startup was acquired by Apple, so I became an employee there, a position I held for many years."
Geller's path, apart from the academic studies, went through the Prime Minister's Office, where he worked for eight years in a technology unit. Then came the initial meeting between the two, which gave rise to a strong connection and the ability to work together.
"I like to say that two people in my life have changed it. The first is my wife and the second is Omri," says Dar. "From the beginning we had fun working together. We both had a desire to start a company, and somehow fate brought us together at the right time and with the right background."
"We understood that AI would be everywhere"
The two entrepreneurs were mentored by Tel Aviv University's Prof. Meir Feder. He is a professor of electrical engineering and has served as head of the AI and Data Science Center at Tel Aviv University.
Back then they both already understood that AI would be everywhere and they also understood that "It would require unique computerized power, in the cloud for example," says Geller. "We also understood there would be a place for a new software, one that would know how to best manage the new computers, those based on AI."
He adds that there were two main decisions behind the founding of Run:ai. The decision to work together and the decision to focus on AI. "We realized that this is not just hype, but a technology that is going to change the world," says Geller. "It's a market with great opportunities. We both come from a hardware background, and we understood that it was going to be a critical part of AI systems. This need will only grow."
To accelerate and improve Nvidia's capabilities
Both entrepreneurs say that the turning point was when Nvidia launched its GPUs - the graphics processors developed 30 years ago, adapted for operating AI. "We understood that we riding on something very big and the wave will not be stopping."
What does your product actually do?
"We are the only company in the world that allows AI companies to receive much more from their AI infrastructure. To get more clarity, better and more performance, and much more computing power."
"We have built tools that allow AI teams as well as researchers and developers, to nurture and implement models in their applications, much more easily, quickly and effectively."
The two add "There are many tools that try to solve problems in the areas we are trying to solve, our uniqueness is the very deep technology we have built, which is different from the way other companies try to approach the same problem".
The company's name is also derived from an instruction given to a computer. "Our mission was to run AI tasks," Geller explains, "and run is a generic command in the software world, a command to run, hence Run:AI."
The first investors that expressed interest
Investors in Run:ai include TLV Partners, SCapital VC, Insight Partners and Tiger Global.
Dar says, "We met the right investors who identified the potential together with us." They recall that Rona Segev from TLV Partners was the first to get enthusiastic about them.
"We had an immediate connection with her. We spoke about the future computing power and how difficult it would be to run so much data. We spoke about our vision - to make it all become much easier."
Segev decided to invest even before the company had a product to offer. There was only the presentation. "The initial financing was really based on some kind of belief that someday we would have something," they say.
Even before the latest reports about the big acquisition by Nvidia, the two say that they enjoyed a positive momentum in their activity, supported by increased revenue.
But then the war came. "We already had a significant operation, with customers and sales," Geller says. The company already had about 100 customers, with corresponding growth.
After good growth in 2023, the two entrepreneurs say that already in the current quarter they will probably reach last year's revenue.
The effect of the war hit the company from another angle - 20% of its employees were drafted into the reserves. Dar says, "The war is very complex. On the one hand, it's dealing with the personal difficulties of each and every one of us alongside the business challenges. Abroad they don't take into account that there is a war."
They also say that it has been very difficult for people in Israel to function, precisely when AI is 'exploding'. "Everyone is talking about AI and Nvidia, and we had to live with this gap between Israel and what is happening in the world," Geller says.
"In the end we continued to develop the product, and support our customers, because ultimately we are a global company. So we have got through this period as best as we possibly could."
Published by Globes, Israel business news - en.globes.co.il - on March 18, 2024.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.