Israeli startup Granulate has been acquired by Intel for positioning on the company's traffic management tools for customers. The company's current 120 employees will be folded into Intel come Q2 2022 when the deal is said to officially close. Granulate will still continue to perform its typical day-to-day operations in Israel.
Despite attempts at secrecy, the acquisition between Granulate and Intel is reportedly in the ballpark of $650 million, per TechCrunch sources. The Israeli startup has been raking in cash via various seed rounds, one of which netted Granulate $30 million in Series B from a year ago. The most recent form of cash flow for the company saw a $110 million valuation after raising $45.6 million from the likes of Red Dot Capital, Insight Partners, and many more investors.
Intel's aim is a two-stage formula, wherein Granulate will mainly assist in bolstering the chipmaker's networking capabilities across its many products, specifically targeting consumers through assisted services and help features. Nvidia has been making similar transactions via the likes of Bright Computing, which it purchased in January, and most significantly, Arm, the $40 billion master play dominating the field of AI integration.
Asaf Ezra, CEO and co-founder of Granulate, relayed his anticipation of the acquisition and where it leaves his company in terms of technological insight. He explains that similar concepts are "going on inside of Netflix," but "it's a testament of how large you need to be to address this issue." Granulate has partnered up with several mega tech firms, including Intel previously and Google, Microsoft, and IBM. Resource management and optimized customer tools on Intel's architecture will be a key strategy going forward.
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"Together with Intel, we believe we can help customers achieve meaningful cost reductions and five times the throughput across workloads. As a part of Intel, Granulate will be able to deliver autonomous optimization capabilities to even more customers globally and rapidly expand its offering with the help of Intel's 19,000 software engineers," says Ezra.
While Granulate itself will now be able to expand far quicker and more efficiently than it could ever have before, Intel will likewise be privy to a whole new, more expanded market; Europe and Israel, specifically. Intel is seeking to take its business further into more global markets, eyeing a potential future €80 billion investment throughout the EU sector, kicking things off with an initial €33 billion R&D investment.
But it's not just over the pond for Intel, as Israel has no sooner become a top player in innovative design practices. And Intel is vying to be at the center of the action, as witnessed in its Mobileye division, which will no sooner become its own entity following a $600 million investment into Israel-based R&D operations. Other Israel-based acquisitions under Intel include Habana Labs, an AI chipmaker, as well as Tower Semiconductor, which netted $5.4 billion for its custom foundry operations in February.
Investor advisors agree that Intel isn't slowing but more so ramping up its approach to M&A, most notably in the Israeli sector. Despite the leap, Intel stock is seeing a slow decline on Thursday, falling about 2.27% as of writing. Year over year, revenue has been up by 2.75%, but major players like Nvidia and even AMD prove to be making massive plays against the chipmaking giant.
