Toronto-based business information services giant Thomson Reuters has acquired New York-based Materia AI for an undisclosed amount.
Founded in 2022, Materia’s artificial intelligence (AI) assistant automates and assists in research and workflows for accounting uses such as taxes and audits. The platform can analyze and search through a centralized inventory of accounting documents, allowing users to quickly find and review the information they need.
Thomson Reuters provides a variety of business information services such as specialized software and tools for legal, tax, accounting, and compliance professionals, as well as operates a global news service, Reuters. The firm also has a venture capital fund that primarily invests in Series A and B companies operating in its services areas, with a strong focus on machine learning and AI.
“Building strong partnerships are a good way to consider what a good acquisition could look like.”
Joe Dormani
Thomson Reuters Ventures
Materia emerged from stealth in June of this year, securing $6.3 million USD from a group of investors that included Thomson Reuters Ventures (TRV), according to a report by TechCrunch. Following the acquisition, Thomson Reuters disclosed that it had already allowed select users of its legal and accounting software Checkpoint Edge to use Materia’s AI assistant during a proof-of-concept initiative. The firm said the “promising initial results” provided confidence that Thomson Reuters and Materia together can deliver value for its customers.
TRV spends a lot of time looking at companies that make sense as acquisition targets, partner Joe Dormani told BetaKit in an interview back in February. Dormani added that the venture arm often invests in areas it thinks are strategic, then works with those companies to explore partnerships that could open up the potential for an acquisition.
“Building relationships is the best way to build strong partnerships, building strong partnerships are a good way to consider what a good acquisition could look like,” Dormani said.
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In an interview with BetaKit at Collision earlier this year, Thomson Reuters chief product officer David Wong suggested that, while there is still a lot of hype, AI is experiencing a “reality check” as corporate buyers have become more discerning. He added that customers of Thomson Reuters have been using AI to make information retrieval easier and produce written work across a broad set of use cases—augmenting the work of, rather than replacing, lawyers and accountants.
Thomson Reuters told BetaKit that the acquisition of Materia accelerates its vision of providing each professional it serves with a generative AI assistant, adding that Materia will enable its customers to “dramatically improve” efficiency and effectiveness.
Wong said in a statement that, once fully integrated, Materia will unify the Thomson Reuters customer experience with applications across its tax, audit, and accounting portfolio. Thomson Reuters said that Materia CEO Kevin Merlini will report directly to Wong, while Materia’s team will continue to report to Merlini.
Feature image courtesy Thomson Reuters.