Recalls are costly—and damaging—for any company, regardless of size or market.
For example, McKinsey calculates that, for companies that make medical devices, recalls have reached $600 million in recent decades. The impact on reputation tends to be lasting. Customers don’t forgive quickly. A poll by Harris Interactive found that 55% of shoppers would switch brands after a recall, and that 21% would avoid buying any brand made by the manufacturer of the recalled product.
So what is a business? Well, maybe turn to AI, suggests Daniel First.
First is its CEO Axion Raya company building an AI-powered platform to predict product failures by taking signals—from field service reports to sensor readings—and correlating those signals along with geographic location and other data.
It’s big business.
Axion Ray, valued at $100 million, today announced that it has raised $17.5 million in a Series A round led by Bessemer Venture Partners, with participation from RTX Ventures, Amplo and Inspired Capital. The new tranche brings New Castle, Delaware-based Axion’s total to $25 million, which First says will go toward expanding its platform capabilities, entering new industries and growing Axion’s workforce .
The idea for Axion came to First while working at McKinsey, he says, in the AI strategy department. There, he saw that AI projects to avoid product problems often failed because the AI was not refined enough.
“To be successful, AI solutions that proactively mitigate issues need to be layered into a product, with workflows that different teams can use to work together to solve problems, powered by a scalable, high-precision AI platform said First. “Without [the right solution], many different teams across the enterprise do analysis on emerging quality issues. This creates overlaps and a lack of cooperation.”
Axion Ray was first launched in 2021 to provide not only a way to detect warning signs that a product might fail, but also to give the various teams in an organization — engineering, program, product, production, field quality and support customers — a unified view of the subjects and any data related to them.
“Product quality issues can have an impact on the end user if [the] Issues are not being addressed quickly and efficiently,” First said in an interview with TechCrunch. “Manufacturers struggle to proactively manage emerging issues affecting their customers because field quality teams spend countless hours manually analyzing messy data sources to understand potential emerging issues.”
That, says First, is where the Axion Ray can help.
It gives the example of the malfunction of the anti-lock braking system of a certain car model. Axion Ray’s algorithms can initially detect the problem from field engineering reports and then identify the same or similar issues for call center complaints, reports from car dealership visits and car telemetry readings.
“We use a specialized artificial intelligence to scan messy, unstructured and disconnected data across various systems to highlight recurring product quality issues,” explained First. “We can help a manufacturer understand that updating the hardware and software on a camera, for example, has resulted in an increase in certain error codes, telematics diversions, calls to the call center and returned parts.”
Now that’s a lot of data for Axion to take in — and for good reason, First would argue. But how does Axion handle this from a privacy perspective?
Axion says it typically retains data “for the duration of an active account” or as described in a customer’s contractual agreement. Product owners concerned about how long data is retained may find this nebulous policy troubling. Initially, however, he maintained that Axion would delete customer data within 30 days of receiving a request.
“We are committed to handling customer data responsibly,” he added.
With a team of 70 employees and clients in healthcare, consumer electronics, aerospace, automotive and industrial equipment, including Boeing and Denso, First said he feels confident about Axion’s growth trajectory.
“There are several trends that have supported Axion Ray’s expansion,” said First. “Many industries are rolling out new technologies — such as electric vehicles or other software-rich products — that introduce unpredictable issues. Manufacturers are also working with new suppliers they have never worked with before. This results in more quality issues than ever before. Finally, manufacturers want to upgrade their workforce to take advantage of AI in automating more manual tasks.”
Added Kent Bennett of Bessemer Venture Partners via email: “Axion Ray has emerged as the clear market leader in automating workflows for field engineers to identify quality issues faster. The enthusiasm we’ve heard from customers about Axion tells us the company is delivering a clear and massive impact. The ROI that command center AI provides in improving uptime, customer satisfaction and reducing costs has been a catalyst for significant growth within the customer base.”
