The first outside capital has been raised by a startup created by U.S. Navy Veterans to help decipher the data collected by submarines using artificial intelligence.

Spear AI, based in Washington, specializes on passive acoustic information that is collected by underwater listening devices. The long-term goal is to use AI in order to help submarine operators determine whether an object they hear is a whale or rain squall. They also want to know where the object is located and how fast it's moving.

Most existing AI tools have to be trained using data, such as images or words that were painstakingly labeled or organized by companies like Scale AI. They recently signed a deal worth $14.8 billion with Meta Platforms.

The data from acoustic sensor is different. Spear AI's co-founders Michael Hunter and John McGunnigle are preparing data to be used by AI algorithms.

The company offers sensors that can attach to buoys and vessels, as well as a software program to label and sort data collected by sensors so it is ready for AI systems. Spear AI's data-labeling software was awarded a $6 million contract by the U.S. Navy earlier this month.

Spear AI was founded in 2021 and is self-funded. It has approximately 40 employees. Hunter, the CEO of Spear AI, reported that the company raised $2.3 from AI-focused venture firms Cortical Ventures, and Scare the Bear, a private equity firm.

The money will be used for the company to double its headcount in order to support government contracts as well as commercial prospects such monitoring of underwater cables and pipelines. Hunter stated that Spear AI is also looking to sell consulting services. This model is similar to the defense tech firm Palantir.

Hunter said, "We wanted the product out of the door and built before the contract came to get it." Private capital is the only way to do this. Rod Nickel edited the report by Stephen Nellis, San Francisco.

(source: Reuters)