Inference Corporation

~ the goodbye ~

ART stood for Automated Reasoning Tool, and in the mid-1980s it was on the short list of programs a corporation bought when it had decided to do artificial intelligence. You described your domain as rules and facts, the engine worked out what followed, and the result was called an expert system. Inference Corporation sold it from Los Angeles. It had been founded in 1979, which puts it a full six years ahead of the boom it would ride and about nine ahead of the collapse.

The collapse is the interesting half. The expert-system shell business did not shrink, it more or less stopped, because the systems were expensive to build and brittle once built, and because a lot of them ran on hardware that stopped being manufactured. Most of the companies in that first wave are graves on this site. Inference did something none of them managed, which was to notice early that the interesting part of its technology was not the rules.

It moved to case-based reasoning. Instead of encoding what an expert knows as logic, you store what has already happened as cases and match the new problem against the old ones. That turns out to be exactly the shape of a technical support call, and by the 1990s Inference was selling it to help desks. In 1993 the New York Times wrote up a Compaq printer that could tell you what was wrong with it, running on Inference's software. If you have ever typed a problem into a support site and been handed a list of articles that half-apply, that lineage runs back through here.

~ the chronicle ~

~ after the winter ~

By the end, the filings describe a company selling products called k-Commerce Support Enterprise and k-Commerce Sales, built on case-based reasoning, with patents on its implementation of it. The filing is careful to say that case-based reasoning itself "is available in the public domain" and that only Inference's implementation of it was proprietary. Companies do not usually volunteer that much in an intellectual property section.

Revenue, for fiscal years ending 31 January: $29.4 million in 1996, $36.0 million in 1997, $28.2 million in 1998, $31.1 million in 1999, $22.9 million in 2000. The peak is 1997 and the shape after it is a company that cannot get back there. 197 people worked for it at the end of February 2000, 141 in the United States and 55 in the United Kingdom, with one person in the Netherlands. More than half of its revenue by then came from services rather than from licenses, 57 percent of the total in that last year against 43 percent the year before. A software company whose consultants are outgrowing its product has stopped selling the product.

~ twenty six names ~

The background section of a merger filing is usually the most candid document a dying company ever produces, because it has to be. Inference's says that in September 1999 its adviser, Adams, Harkness & Hill, drew up a list of twenty-six potential partners while management worked on "efforts to improve its financial performance". eGain was on that list. eGain said no in December. Three months later eGain signed an exclusivity agreement, and three weeks after that there was a deal.

The two already knew each other. A reseller agreement from February 1999 let Inference bundle eGain's email product, so there was a commercial relationship in place more than a year before anybody discussed a merger.

~ the swap ~

It was stock, with no cash in it anywhere. The agreement of 16 March 2000 set an exchange ratio of 0.1865 eGain shares per Inference share with a collar around it, and by the time it closed the ratio actually paid was 0.7362. That gap is the collar doing its job on the way down, because eGain's own share price had fallen through the floor of the range in the three months it took to get to a vote, and the spring of 2000 is when that was happening to every company of this kind.

On 29 June 2000 Intrepid Acquisition Corp., the Delaware vehicle eGain had formed for the purpose, merged into Inference, which survived as a wholly owned subsidiary. About 5,901,481 eGain shares went out, plus assumed options over roughly another 1,609,525. The next day Inference filed to deregister, and on the form where it has to state the approximate number of holders of record it wrote: 1.

~ what the name means now ~

eGain is still listed and still sells knowledge-base software for customer service, so the work did not stop, it just stopped having this name on it. The word "inference" has meanwhile been collected by the current wave: inference.com today is an unrelated business-AI brand, and in the vocabulary of 2026 the word describes what a model does when it answers you rather than what a rule engine does when it chains forward. Twenty-one years of a company, and the most durable thing it owned turned out to be a noun.

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