Netail, a spinout company from Google Brain co-founder Andrew Ng's Landing AI group, is expanding to Pittsburgh and will establish the city as its headquarters following the raise of a $5 million seed round co-led by Landing AI and Pittsburgh-based Magarac Venture Partners. It marked the first close for MVP's $150 million fund, a deal that took about six months to complete.
For Mark Chrystal, the CEO and co-founder of Netail, Pittsburgh will serve as a launching pad for a company that only recently came out of stealth mode. The revenue-producing startup specializes in tracking consumer products across the internet using AI to then allow its retail customers to better optimize their prices against competitors in real time.
Netail employs about 13 people across its Palo Alto, California, office and its office in the South American country of Colombia. In addition to opening its HQ in Pittsburgh — the exact details of where it will be are still in the works, though Chrystal wants to be close to the campus of Carnegie Mellon University — Netail will also open a satellite office in Hong Kong as a result of the funding raise. Chrystal expects to ramp up hiring in Pittsburgh after migrating most of these workers here in the coming months but couldn't share a specific figure at this time.
"We're building a significant, global software company in Pittsburgh," Chrystal said. "As you look out into terms of a five-to-10-year horizon, you're certainly looking at ideally many hundreds of employees, if not thousands."
As for Pittsburgh's strengths, Chrystal touted the region's talent coming out of CMU as well as its lower cost of living expenses compared to other cities as being a worthwhile place to aid Netail in getting to its next stage of growth. Chrystal expects this recent funding round to ensure the company's runway for several years to come.
"I think it's one of the most livable, attractive cities in the U.S.," Chrystal said of Pittsburgh. "Great schools, great standard of living. Recruiting engineers in Silicon Valley and in the Bay Area is extremely expensive, frankly, and so actually it makes a lot of sense for a startup to base itself in Pittsburgh given the difference in cost of living"
Chrystal described himself as "a retailer at heart" and has an extensive background in using analytics within the retail industry, a sector where he has led nearly every function of its supply chain. He has previously served as the chief analytics officer and senior vice president of eCommerce at Warrendale-based apparel retailer rue21 LLC. He also served as a vice president at South Side-based American Eagle Outfitters Inc.
His educational background includes a doctorate that focused on consumer behavior in digital environments and a master's degree in machine learning and AI, among others.
"I know enough to be dangerous there," Chrystal said. "I try and stay out of the engineer's hair but I know the right questions to ask at least."
But then he stepped out of that in-line corporate world to build software for major corporate retailers. That software building is what led to his co-founding of Pittsburgh-based MachineCore, which uses AI to analyze customer feedback that's then converted into actionable recommendations for management. Chrystal would then go on to be connected with Ng, who serves as Netail's chairman, to lead Netail.
"I knew that [retailers] were desperate for [Netail's offerings], and frankly a lot of them won't survive without this type of solution," Chrystal said.
