Northern Gritstone, a leading investor in science and technology from northern England, has spearheaded a seed funding round of £4.6 million for Literal Labs, a British start-up dedicated to creating energy-efficient artificial intelligence solutions through logic-based methodologies.

Spin out from Newcastle University, Literal Labs has developed a distinctive approach to AI model construction that significantly enhances efficiency compared to traditional neural networks.

Neural networks, mimicking human biological processes, often involve intensive multiplications that can be computationally demanding, necessitating the use of expansive data centers filled with expensive AI hardware.

In contrast, Literal Labs employs a technique rooted in Tsetlin machines, founded on the work of Mikhail Tsetlin, a Soviet mathematician whose research in the 1960s introduced alternative concepts for artificial intelligence.

While capable of complex machine learning training similarly to neural networks, Tsetlin machines utilize propositional logic rather than biological analogs, making them more efficient in computation and less energy-consuming.

The funding round not only saw Northern Gritstone take the lead, under the chairmanship of Lord O’Neill of Gatley, but also included participation from London-based Mercuri, which invests at the crossroads of media, entertainment, and technology sectors. Additional contributions came from Sure Valley Ventures, Cambridge Future Tech SPV, and various angel investors.

Dr. Alex Yakovlev and Dr. Rishad Shafik, professors at Newcastle University, are the co-founders of Literal Labs. Noel Hurley, the CEO, previously headed the microprocessor division at UK’s semiconductor firm Arm.

Duncan Johnson, CEO of Northern Gritstone, expressed excitement, stating, “Literal Labs represents our first investment linked to Newcastle University, which is renowned for technology innovation. We’re excited to support Noel Hurley and the team, especially as the demand for AI efficiency grows.”

Hurley remarked on the transformative moment for AI technology, highlighting ongoing trends of sustainability and economic viability, “Our logic-based AI provides a compelling alternative for those seeking high-performance tools that are faster, more energy-efficient, and more understandable than the existing neural network offerings. This funding will accelerate our product development, allowing us to launch our inaugural product later this year.”

Despite the prevailing dominance of neural networks in AI discussions and investments, Hurley acknowledged that this trend stems from the mature research landscape surrounding neural networks, while Tsetlin machines are still emerging.

“Today’s AI, akin to a junior football team, sees everyone clustered around the popular ball — in this case, neural networks,” Hurley noted. “Our goal is to expand the toolkit available for artificial intelligence and machine learning.”

The company has plans for its initial commercial product, set to be unveiled to the market in the latter half of this year.

Rick McCordall, the head of company creation at Newcastle University, stated, “We are thrilled that Literal Labs has successfully completed its £4.6 million funding round. Over the past two years, Newcastle University spin-outs have garnered £40 million in investments.”