Anthropic Moves to Acquire Israeli AI Startup Decart in Multi-Billion Dollar Deal

Israeli startup Decart is on the verge of being acquired by AI giant Anthropic in a landmark deal that could mark Anthropic's first direct entry into the Israeli market, Bloomberg reported on Thursday. Until now, Anthropic operated in Israel mainly through Israeli sales representatives based in Ireland. Founded in Tel Aviv by Dean Leitersdorf and Moshe Shalev, Decart had previously engaged in acquisition talks with Nvidia and is now poised for a major exit.

The deal, valued at around five to six billion dollars, is expected to make Decart's founders millionaires and yield significant returns for early investors such as Oren Zeav's Zeav Ventures, Israeli-American investor Tilly Klisky, and venture funds Sequoia and Benchmark. Notable shareholders include Anthropic scientist Andrey Karpati, Michael Eisenberg via Aleph fund, and Yossi Sharial, a former 8200 unit commander and advisor to the Israeli Prime Minister.

Decart developed graphical language models aimed at gaming and 3D environments but struggled to generate stable revenues, leading to frequent product pivots. Its main income came from a more basic product focused on improving the efficiency of language model inference on graphic processors, sold to AI labs. The company invested tens of millions of dollars in computing resources and server farms.

Anthropic brings complementary strengths, including language models and AI agents for code generation and organizational tasks, holding the largest market share in code generation. Decart’s models simulate 3D objects and environments, initially applied in gaming but now proving valuable in robotics and "physical AI," a growing sector involving autonomous vehicles, drones, and humanoid robots performing industrial and domestic tasks.

The acquisition also leverages Decart’s proprietary optimization engine, enhancing training and inference efficiency across various processors, including Nvidia, Google’s TPU, and Amazon’s Trainium chips developed by Israeli company Anapurna. This technology can reduce AI computational costs, token prices, and latency, appealing to organizations using diverse hardware. The deal positions Anthropic to expand into markets where it currently has less dominance and compete with rivals like Elon Musk’s xAI and Google’s DeepMind.