Ridgeline Newsletter: Red Hat Acquires Neural Magic, Navy Partnership, and Record Quantum Funding
Last Tuesday, Red Hat announced the acquisition of Neural Magic, a Ridgeline portfolio company. The acquisition marks a three year journey with the company and a solid affirmation of the original thesis Ridgeline put forward to invest in the company back in late 2021.
When we invested, GenAI had yet to capture imaginations but the direction of the market and challenges in training and inference was already apparent. Our assumption at the time was that costly and specialized infrastructure to power AI workloads would create market opportunities for software-defined infrastructure and enabling technologies that could create efficiency or ease of use for commodity compute, GPUs, and other specialized hardware.
We also believed that the dominant communities in AI would be open, there would be no “single platform” to rule them all. Neural Magic’s deeply technical team, community driven ethos, and clear differentiation in their product led us to make the investment. Our conviction was emboldened by the addition of Brian Stevens as CEO in late 2021.
What we did not anticipate at the time was that LLMs would become the dominant model type in the market and a massive opportunity would surface in open source-licensed LLMs. This shift became apparent quite rapidly after the launch of ChatGPT in November 2022 and Meta’s LLaMA a few months later.
With massive credit to Neural Magic’s entire team, they were able to navigate this massive shift in the market and were able to build out a leadership role in the vLLM project that drove interest from the Red Hat side.
To quote Brian, “For the last 5 years, we have been contributing open research, open-source model quantization and sparsification tools, and open-source pre-optimized models to the community. As part of our increasing shift to support GPUs, we have been recognized as the top commercial contributor to the amazing vLLM project.”
For Ridgeline, this is just the beginning. This past year has revealed several exciting trends, particularly around more practical applications in AI across the industries where we focus. At Ridgeline, we’re energized by the emerging landscape of Agentic AI—AI systems that can act autonomously and make decisions without continuous human intervention. We are spending a good deal of time on the products tailored specifically for industrial applications like logistics and manufacturing.
For example, Composabl’s multi-agent platform offers real potential for reshaping the physical industries that form the backbone of our economy. Composabl CEO Kence Anderson recently published an O’Reilly Report—Intelligent Autonomous Agents—explaining how this is the dawn of an enterprise where advanced technology and human intelligence work in harmony to transform industries.
Portfolio News
Altana raised $200 million in Series C funding, bringing the company's valuation to $1 billion. This investment, led by Thomas Tull’s US Innovative Technology Fund, will help Altana further develop its platform designed to offer a clearer view of global value chains, something that has become increasingly important due to new trade and security policies worldwide. Altana's platform uses AI to provide detailed insights into the entire supply chain, from raw materials to finished products. This visibility allows businesses and governments to manage supply chain risks, reduce costs, improve sustainability (like measuring carbon emissions), and ensure compliance with regulations.
Q-CTRL set a global fundraising record in quantum technology, increasing their Series B round to a massive $113M. The round, led by GP Bullhound, includes $59M in new capital—a strong signal of confidence in Q-CTRL’s leadership in quantum infrastructure software. Q-CTRL has also been natively integrated into the platforms of major quantum computing companies IBM, Rigetti, Oxford Quantum CIrcuits, and Diraq. The company’s software, Fire Opal, enhances these platforms by minimizing errors and boosting their usability and capability.
Photo: The AI Squared team attended the AI for Defense Summit and gained valuable insights about the U.S. Navy’s plans for rapid AI activation. (Source: Napoleon Paxton, VP of Federal Technology at AI Squared)
AI Squared has been awarded a $1.5 million contract with the Navy. This partnership will see AI Squared install its cutting-edge technology within Jupiter, the Navy's ADVANA enclave, enabling the execution of various business and mission-critical use cases. Aligned with the Department of Navy's CIO vision of a data-driven organization, this contract aims to enhance data accessibility and usability, ultimately improving mission readiness and effectiveness. AI Squared’s solutions will connect information producers and consumers, paving the way for better AI experiences across the Navy.
Harbinger has partnered with THOR Industries to deliver the world’s first hybrid Class A RV motorhome, making waves in the automotive industry. This innovative vehicle features a plug-in hybrid electric chassis with a 150-mile EV-only range and an estimated total range of 500 miles. Powered by a 140-kWh battery pack and a low-emissions gasoline generator, it significantly improves fuel efficiency compared to traditional RVs. Scheduled for commercial availability in 2025, this collaboration marks a significant step toward sustainable transportation solutions.
Eion recently made headlines on CNBC, showcasing its groundbreaking approach to carbon removal through enhanced rock weathering. In a compelling video, CEO Anastasia Pavlovic Hans explained how Eion harnesses volcanic rock to permanently absorb CO2 from the atmosphere while simultaneously restoring soil health. “By 2030, Eion aims to remove the equivalent of about two million cars' worth of carbon from the atmosphere each year,” she stated.
Opentrons launched their Flex Prep robot. From transforming COVID testing in NYC to creating mobile labs for disease outbreaks in African villages, Opentrons has been a global leader in lab automation. With Flex Prep’s no-code interface, labs can now automate complex tasks in seconds, freeing up time for more critical research.
Wallaroo partnered with Oracle Cloud Infrastructure to make AI easier and faster for businesses. By allowing AI models to run in real-time on various hardware and across multiple applications, this partnership helps companies get valuable insights more quickly and efficiently. At Ridgeline, we believe in supporting innovations like this that simplify the power of AI and make it accessible to the broadest set of industries.
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At Ridgeline, we invest in startups focused on catalyzing a new industrial revolution, a U.S. renaissance focused on leveraging AI, automation, and deep tech to boost productivity. We back founders that have the vision and deep expertise to tackle these challenges and support them throughout their journey with an unparalleled go-to-market platform.
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