Microsoft ramps up A.I. game with bet on startup that helps coding novices build apps
- Through a strategic partnership, Microsoft plans to integrate Builder.ai's own AI assistant Natasha in its Teams video and chat software to let customers build business apps within the platform.
- Microsoft has also taken an equity stake in Builder.ai. The companies declined to disclose the financial terms of the deal.
- The deal signifies a further bid by Microsoft to ramp up its efforts in AI, which has become a core focus for the company as it looks to become a leader in the technology.
LONDON — Microsoft invested an undisclosed sum into Builder.ai, a startup that helps companies make applications without any coding experience, doubling down on its artificial intelligence efforts.
Founded in 2017 and headquartered in London, Builder.ai falls into the camp of startups that make so-called "no-code" and "low-code" platforms. Its software allows anyone from tech-shy artists looking to sell their work online to design professionals with limited programming experience to develop and manage apps.
Through a strategic partnership, Microsoft plans to integrate Builder.ai's own AI assistant Natasha into its Teams video and chat software to let customers build business apps within the platform. Builder.ai will also enhance Natasha by leveraging Microsoft's AI algorithms to make it sound more human, the company said.
The collaboration will give Builder.ai and its clients access to Microsoft's Azure suite of cloud tools, including a set of AI services it offers through a tie-up with U.S. startup OpenAI, Builder.ai said. Developers on the Microsoft Azure platform will also be able to tap into Builder.ai's network of experts, it added.
"We're all convinced that the future of software is going to be where the customer doesn't need to be technical," Duggal told CNBC in an interview. "What we're really doing is bringing together a world where customers are able to build software, run software, host software."
"For Microsoft, it opens up not only a brand new customer that's become digital native, but somebody that's coming on to the Azure Cloud, where that building of the software is leveraging core parts of the Microsoft stack, as well as the Builder stack. So I think from that perspective, it's really quite holistic. And the mission really is to empower the next 100 million software applications."
Jon Tinter, corporate vice president of business development at Microsoft, said the deal marked "an extension of our mission to empower every person and every organization on the planet to achieve more."
"We see Builder.ai creating an entirely new category that empowers everyone to be a developer and our new, deeper collaboration fuelled by Azure AI will bring the combined power of both companies to businesses around the world," Tinter said in a statement.
Builder.ai and Microsoft declined to disclose the financial terms of the deal.
Microsoft has massively expanded its investments in AI lately, plowing a reported $13 billion into OpenAI, the company behind popular AI chatbot ChatGPT, and incorporating the firm's AI language processing software into its Bing search engine and Office productivity apps.
The deal signifies a further bid by Microsoft to ramp up its efforts in AI, which has become a key focus for the company as it looks to become a leader in the technology and compete more aggressively in search with fellow technology giant Google.
The Alphabet-owned company has made investments of its own into AI, seeking to make digital entities more conversational and humanlike with its LaMDA language processing model, and rolling out a rival to ChatGPT called Bard.
Microsoft already offers its own suite of no-code app development tools. With Builder.ai, it is hoping to advance its expertise in this area.
A critical component of the deal for Builder.ai is the endorsement of the world's second-most valuable tech company, Duggal said.
"If you imagine we're going to go speak to big enterprise ... who's going to ask us about competency at that point?" Duggal told CNBC. "It gives you a huge leverage from go to market [strategy], which in itself benefits both partners."
Builder.ai has raised a total of $195 million in funding to date, according to Crunchbase data. It is one of numerous startups that have benefited from renewed investor interest in AI technology lately.
At the same time, advances in the technology have led to concerns from researchers that it is getting too powerful. In March, a group of tech heavyweights including Elon Musk and Apple co-founder Steve Wozniak wrote an open letter calling for a six-month moratorium on the development of AI more powerful than GPT-4, OpenAI's latest large language model.
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