The meteoric rise of Artificial Intelligence (AI) may still raise some eyebrows from luddites and doom-mongers alike, however one thing can be said for sure – it’s altered the investment space dramatically over the last few years, with the scramble to catch the gravy train apparent everywhere you look.
Take Allbirds for example, a shoe company once seen on the feet of famous people like the former US President Barack Obama, it’s share price soared 580% after it announced plans to artificial intelligence and rename NewBird AI. It’s tempting to throw caution to the wind, after all the technology now seems to be omnipresent and the real-world impact can be felt in almost every facet of daily life – from AI slop and dating to healthcare and Hollywood. However, jumping on board without understanding how companies use this technology and the value it really adds is inevitably going to end badly for many. To borrow from Warren Buffet, “What the wise do in the beginning, fools do in the end.”
Leveraging AI technologies will help companies expand market share, unlock new revenue streams, and access new markets, Calculus are aware of that but are also wary of this maxim. Any prudent investor should look past the AI headlines in a company’s blurb and eye it with a touch of cynicism. What benefits does AI and machine learning really offer that set this company aside from its competitors and put it on the path to success? The Calculus portfolio is focussed on technology, life sciences and software-enabled businesses, which are well positioned to benefit from the continued growth in AI, with investee companies already deploying large language models to enhance operational efficiency, improve decision-making and support scalable revenue growth.
With that in mind Calculus are proud to have made their most recent investment into Edify which is an AI-first operations platform for quick-service restaurants, targeting an industry with razor-thin margins and a chronic over-reliance on manual labour. Its platform is now being used at Pret a Manger to assist employees in the kitchen, helping with production forecasting (predicting intra-day demand so kitchens prep the right amount at the right time), automated ordering (learning each location’s consumption patterns to cut waste and improve cost of goods), and a conversational analytics agent that gives operators instant visibility across all their locations. The AI itself isn’t the differentiator, the proprietary data flywheel is. Every location added feeds operational intelligence back into the models, making them progressively harder to replicate.
Since the origins of the modern insurance industry in 17th-century London, underwriters have sought to accurately price risk, something that remains complex today. The rapid progress being made in machine learning is transforming how longstanding challenges like these are solved. Calculus portfolio company Optalitix helps address this problem by embedding it into pricing, underwriting, and risk assessment. Its software enables firms to better analyse both historical and real-time data, improving predictions around insurance risk, creditworthiness, fraud, and customer behaviour. Crucially, Optalitix focuses on operationalising AI, turning models built in tools like Excel or Python into scalable, production-ready systems. This allows clients such as Zurich, Pool Re, and Vitality to deploy advanced analytics more effectively in day-to-day decision-making.
Another new addition to the portfolio is Resurrect Bio which we invested in alongside Corteva, one of world’s leading agricultural companies. This biotechnology company is developing a new approach to crop protection by restoring plants’ natural genetic defence against disease. It uses its AI-powered FloraFold® platform (which is essentially a bespoke version of Google’s Alphafold platform) to engineer disease-resistant crops by analysing plant–pathogen interactions at the molecular level. The system uses deep learning to predict how pathogen proteins interfere with plant immune proteins, identifying where natural defences fail. Rather than inserting new genes, FloraFold detects existing but compromised resistance genes in plants and determines how to restore their function. It then proposes precise genetic edits. These AI-generated predictions are tested through computational simulations allowing rapid validation at scale and once confirmed, gene-editing techniques are used to implement the fixes. This approach offers farmers a powerful new way to protect yields, reducing reliance on chemical inputs while addressing the growing threat of crop disease to global food security.
Generative AI has also given rise to whole industries that have sprung up to counter its use. This is particularly the case in recruitment where the likes of ChatGPT have broken traditional recruitment tools overnight and is causing employers to reassess text-based application procedures (using CVs and cover letters; or text based psychometric testing). In 2022 Calculus invested into Arctic Shores. The company’s assessment platform measures cognitive and personality traits of individuals through a series of tasks that test true human behaviour. These assessments help employers to build a diverse and successful workforce, removing unconscious bias and helping organisations to widen their talent pools and unearth high-quality candidates who might have been missed by CV screening and traditional tests.
In line with this companies must also be wary of AI. Within the SaaS space recently ears have been burning with all the discussion around Anthropic’s agentic coding system and the so called ‘SaaSPocalypse’. It’s important we bear this in mind, however the strongest B2B platforms are not simply interfaces, they are years of proprietary workflow data, deeply embedded customer processes, compliance infrastructure, and trusted relationships with enterprise buyers who are not about to hand sensitive business data to an experimental AI-native tool. This is not to say some SaaS companies won’t be affected, it will sort the wheat from the chaff and kill off “nice-to-have” and poorly managed products, but this will also create room for valuable, essential SaaS to thrive.
AI is no longer just an operational tool it is a strategic lever that provides a competitive advantage, making it a core priority at board level discussions. Adapt or die is the old adage and Calculus are making sure its portfolio companies recognise this in an increasingly complex and technology-driven business environment, laying the foundations for continued success across our EIS portfolios and Calculus VCT.
Get in Touch
To find out more about the Calculus EIS Funds or VCT, please contact:
Oliver Warren, Assistant Director, Investor Relations
T: 0207 493 4940 | E: [email protected] | W: calculuscapital.com