Czech startup pioneering machine failure detection through sound analysis set to receive tens of millions of Czech crowns from Brussels

Previously, only the most seasoned experts, who had worked with a particular type of machine for decades, could identify a device based on its sounds. The Czech startup Neuron Soundware aims to make such diagnostics accessible to every company. Now, it has gained support from the European Union, which is providing it with tens of millions of crowns.

Neuron Soundware uses artificial intelligence to recognize possible malfunctions by the sounds of industrial machines, including wind turbines, giant cranes, machine tools, or even 3D printers. The system can adapt to specific devices. The startup not only develops software for failure detection through sound analysis but also manufactures hardware that provides computing power for AI operations.
In recent years, the company had to deal with systemic issues, a significant blow came from the pandemic and the resulting shocks in the industry, including disruptions in supply chains.

“We had to adapt to covid, we had to redesign the hardware because we couldn’t produce it. Many startups are reacting to the crisis only now, we went through this a year and a half ago,” explains Pavel Konečný, the company’s founder, for E15. “It was a cascading effect, the chips we used for data transmission suddenly started being used by automakers for window controllers, which meant we had to modify the hardware to be able to produce it,” he describes.

Pavel Konečný for E15

Through the European Innovation Council (EIC) program, the European Union is granting Neuron Soundware seven million euros, approximately 163 million Czech koruna. The amount will be divided into two halves, with the first being provided to the Czech startup as a grant. The EIC has a total of ten billion euros to support breakthrough technologies, with decisions on distribution made by a council composed of experienced business individuals.

In the past, only the Czech company Miwa Technologies, focused on packaging-free food distribution, succeeded in this program. In total, 29 projects from the Czech Republic were shortlisted in its two years of existence.

To receive the second half, the company of Czech engineers must find a private investor. An additional one million euros was obtained from the call of the Technology Agency of the Czech Republic (TAČR). If the company  managed to get an investor who would contribute another three million euros,Neuron Soundware could potentially receive around ten million euros in total for further development, equivalent to about a quarter of a billion Czech crowns in the near future.

“Neuron Soundware belongs to projects with the potential to assist companies on a global scale and have a significant impact on preventing malfunctions in key industrial equipment,” says Martin Kešner from J&T Ventures. Kešner also founded the Idea of the Year competition, in which the Czech startup won in 2016.

In the past, Neuron Soundware has received considerable investments of around 200 million Czech crowns from the Inven Capital fund, which invests funds provided by ČEZ company, and from J&T Ventures. However, due to industry shocks and the complexity of service implementation, the startup is now looking for a fresh start.

“The ultimate goal is to predict a failure, its type and, through machine code, to teach the algorithm to estimate when the malfunction will occur. However, we currently do not have sufficient data for this,” says Konečný.

According to him, Czech startups focusing on hardware production have a significantly more difficult position than companies providing software-based solutions.”I’m a fan of everyone who works with hardware, it is not easy for them.  For instance, Hardwario had to choose the path of listing shares on the Start stock market. They have a great solution and many customers, but at a time when reports about chip shortages were spreading out, the mood among investors is too risky,” Konečný believes.

April 14, 2023 | Filip Zelenka for E15