Fero Labs – an AI-driven manufacturing process optimization software company – recently announced the closing of a $15 million growth round led by Climate Investment (CI) with additional participation from investors Blackhorn Ventures, Innovation Endeavors, and DI Technology. This funding round brings Fero Labs’ total funding to date to $30 million.
The manufacturing industry currently accounts for 25% of global carbon emissions, two-thirds of which come from steel, cement, and chemicals. And Fero Labs works with some of the largest global players in these sectors and uses AI to help their engineers make more efficient production decisions. To date, Fero Labs’ software has uncovered upwards of $20 million in savings for customers including Covestro, Gerdau, and CELSA Nordic, and reduced more than 100,000 tons of carbon emissions. With this new funding round, the company plans to deploy new sustainability features that will accelerate commercialization across key industries, with the internal goal of reducing at least 800,000 tons of emissions by 2025.
Fero Labs’ software provides plant operators – with little-to-no data science background – access to powerful insights, enabling them to understand the root cause of any issue and deploy updates to ensure their plants operate sustainably and at peak performance. And Fero Labs is unique in the industrial space for using white-box AI, which reveals the reasoning behind its predictions. And unlike the black-box AI popularly seen in tools like ChatGPT, Fero Labs makes it possible for users to know if they can trust the results.
Last year, Fero Labs tripled its revenue and number of customers, spanning sectors including steel, cement, chemical, energy, food, and more.
KEY QUOTES:
“We are pleased to announce our latest funding as we continue to build our white-box AI technology to make factories greener. The industrial sector is notoriously hard to decarbonize, and hardware solutions like carbon capture and storage come with a hefty price tag and daunting implementation process. White-box AI software requires no capital expenditure and can be quickly implemented. This means companies can immediately start reducing emissions and quantify emissions reduction more accurately with easy-to-understand dashboards and reports. Tangible proof of impact is a crucial part of the sustainability journey. The participating investors are the perfect long-term partners for us to bring on as we continue to work toward hitting our sustainability goals.”
— Berk Birand, co-founder and CEO at Fero Labs
“Fero Labs’ AI software materially reduces industrial emissions in some of the highest emitting sectors. The white-box algorithm approach engenders confidence even at the operator level, which is something that we haven’t seen in the market before. Given CI’s focus on driving accelerated carbon emissions reduction through high impact innovations, such as Fero Labs, we’re excited to partner and support the next phase of the company’s growth.” Felicity has joined Fero Labs’ Board of Directors alongside CI’s Technology Director, Rick Cutright, who has joined as an observer.
— Felicity O’Kelly, Investment Principal at CI
“We’re excited to work with the Fero Labs team as they empower process engineering teams across ‘hard-to-abate’ sectors. The team’s expertise building AI and machine learning models that drive cost and emissions reductions throughout the manufacturing lifecycle makes them particularly well-suited to leverage applied deep learning for the energy transition. We believe differentiation in a crowded AI market can be found at the foundational data unit, and Fero Labs has a clear path to scale their advantage over time.”
— Melissa Cheong, Managing Partner at Blackhorn Ventures; Melissa has also joined the Fero Labs board as an observer.
