Bengaluru-based information technology (IT) services major Infosys has exited its investment in Danish AI (artificial intelligence) startup Unsilo after three years at more than a 60% loss, according to a stock exchange disclosure by the company.
Infosys sold its undisclosed minority stake in the advanced text analysis startup for $0.8 million (Rs 5.7 crore) to Cactus Communications, a global scientific communications company.
In November 2016, the country's second largest software exporter had invested close to Rs 14 crore (or DKK 14,920,000) from its Innovation Fund, an investment fund it created in 2015 to make investments in startups in the digital domain or emerging technologies. Infosys did not disclose the reasons for divesting its stake or why the partnership did not work.
"With regard to the minority investment made by the company during 2016 in Unsilo A/S, the company announces that it has, on January 28, 2020, completed the divestment of its shares in Unsilo A/S for a total consideration of approximately $0.8 million," the company said in the disclosure.
According to Infosys, Unsilo uses a unique combination of machine learning and natural language processing to analyse large quantities of text and improve the speed and effectiveness of employees across many industries.
During the tenure of previous CEO Vishal Sikka, Infosys made multiple investments in startups as well as a few acquisitions to bolster the company's product and emerging technology expertise. These included companies such as Panaya, DWA Nova and Skava. In all those instances, the company has seen its investment erode by more than two-thirds since its investment.
Since current CEO Salil Parekh took charge, the company has gone back to focusing on services and digital services.
The change in strategy has seen the company consistently report better revenue growth than its main rival TCS. During the third quarter of the current fiscal, the company managed to beat analyst expectations with the IT major revising its full-year growth guidance for the second time during the financial year.