Jobs boost for tech sector as Malted AI, which aims to become biggest tech company in Scottish history and double workforce, raises seven-figure sum

Firm’s founders branded “some of the brightest AI minds emerging from the birthplace of European AI – Edinburgh” and fusing top tech and Scottish academic expertise.

An Edinburgh-based firm specialising in niche artificial intelligence (AI) models and aiming to build the biggest tech company in Scottish history has secured seven-figure seed investment, helping it create further highly skilled Scottish tech jobs.

Malted AI, which is leveraging AI talent out of the universities of Edinburgh and Glasgow and whose founders include a former Meta researcher, a maths champion, and highly technical financial trader, says it takes the output of Large Language Models (LLMs) such as ChatGPT and distils them into smaller equivalents. "Instead of doing thousands of tasks moderately well, Malted AI’s [Large Language Models] do one task near perfectly,” says the business that is credited with having the potential to become one of Europe’s top AI players.

It helps enterprises build smaller, more focused AI models with greater performance at a fraction of the cost, and its technology is already being used by financial and legal firms in its first pilots, with further rollout planned for the rest of 2024.

The start-up, located steps from Edinburgh’s School of Informatics, is to use the newly raised sum to invest in research, product development, and recruitment as it doubles the team from ten currently. Picture: contributed.

The tech firm has now raised £6 million, led by investment vehicle Hoxton Ventures (which describes its offering as European venture with a Silicon Valley mindset) joined by Creator Fund (which bankrolls breakthrough technology) and angel investors.

The Scottish business says it will use the sum to invest in research, product development, and recruitment as it doubles the team size from ten currently, and means it has now raised £7m altogether, after a £1m pre-seed round led by Creator Fund in August 2023.

Malted AI also details how it was born out of concepts that helped founders Iain Mackie, Carlos Gammel and Federico Rossetto win the 2022 Amazon Alexa Prize that seeks out top AI talent from academia, beating more than 100 teams. Its team comprises “world-class” LLM and applied-AI talent hailing from tech giants Deepmind, Amazon, Google, and Bloomberg, and top PhDs, postdocs, and academics from Scottish universities, while it also counts Jeff Dalton, chancellor fellow at Edinburgh’s School of Informatics, as an external chief scientific advisor.

Iain Mackie, Malted AI’s chief executive, said: “At Malted AI we see smaller as better when it comes to AI. A single, many-billion parameter foundation model is costly, too general, and too slow – it's not fit for purpose for the complex challenges enterprises face.

From left: Malted AI's founders Carlos Gemmell, Iain Mackie, and Federico Rossetto. Picture: contributed.

"We are building a world-leading distillation platform that solves the highest-value enterprise problems. We envision enterprises using Malted AI to build small models to address singular challenges, effectively building a network of proprietary SLMs that are optimised for a single problem.”

Bryan Gartner, partner at Hoxton Ventures, said, “Malted AI has the capacity to be one of Europe’s most notable AI companies as they flip the thinking and approach to AI adoption within the enterprise. Iain, Carlos and Federico are some of the brightest AI minds emerging from the birthplace of European AI – Edinburgh – and have close ties to the University of Edinburgh and the University of Glasgow. We are thrilled to be supporting Malted AI as they commercialise their platform and deliver outsized results for businesses in the tiny package of small language models.”