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Iraqi insurgency groups and Silicon Valley startups may not appear to have a lot in common, but according to Quid‘s Chief Technical Officer Sean Gourley, the mathematics underlying innovation and conflict are not that different.
“The dynamics of an insurgency are actually quite similar to startups disrupting an established market,” says Gourley.
Data analysis is becoming ever more important within tech companies but Quid allows corporate strategists to manipulate a data-driven “map” of an entire technology sector’s past, present and even future. The animation below, for example, shows the evolution of the cleantech ecosystem from 2000 to 2010.
The company grew out of Gourley’s Ph.D. research on the mathematics of war. He and his colleagues discovered that the sizes and timing of attacks in conflicts such as Iraq, Afghanistan and Northern Ireland exhibited remarkable similarities, which could be used to predict future attacks and even push a conflict towards resolution. After a particularly grueling month Gourley spent in Baghdad in 2008, investor Peter Thiel advised him to apply the same techniques to technology.
Quid uses natural language processing and semantic clustering techniques to define a set of “entities” such as companies or research groups in an emerging technology sector, and to map their relationships. Each company entity has a signature which is based on explicit events like who is it partnered with, who has it acquired, how much money has it raised. There are also the technologies with which an entity is associated, where it’s located, employee count, traffic, sentiment and many other parameters.
The data used by Quid is publicly-available text in multiple languages, which ranges from news articles and job postings to press releases and SEC or government filings. Quid’s technology map currently contains 75,000 entities and 400,000 events (partnerships, funding, law suits, executive hires, etc.). Building such a map manually, for a particular technology sector, could take months.
The typical Quid customer is a VP of strategy at a large technology company, government department or financial firm. Once the customer has a basic map of the sector, and where his own company and competitors fit in, he can look at adjacent entities and ask questions like, “Where is this space going to move?” or “Which technologies could be recombined?” For example, a particular field of cryptography could be starting to overlap with mobile if researchers are paring down the relevant cryptographic algorithms to be able to compute them on a mobile device.
Most crucially, a customer may want to identify “white spaces” in the map which indicate future growth opportunities. “If you are a large company you tend not to want to be the first one to market in a new space,” states Gourley. “You want to use those white spaces to see external R&D. ‘What has everyone else tried? What am I most able to do myself? What are my competitors doing? Should I do it myself or just acquire someone?’ Because everything changes so quickly, this is something which you must be able to do on a daily basis rather than in a 3-month report, which is the traditional way of analyzing a space.” Tracking how a sector evolved over time and how it may develop in the future is also extremely important to customers. All data is time-stamped so that the entity map can be rolled back to some point in the past.
There seems to be an obvious overlap between Quid’s technology and the work of a venture capital fund or angel investor. Gourley laughs when I ask him if VC funds are customers. “There’s a tremendous about of overlap but they can’t, at the current pricing, afford what we can give them,” he says. The current pricing averages about a million dollars a year. “We normally work with large multi-national companies with hundreds of thousands of employees. Even a big VC firm with a few hundred million dollars under management won’t have the cash.” Microsoft, on the other hand, has been a customer for the last year and a half.
Quid’s main rivals are Recorded Future, which deals with data available on public companies, and traditional business intelligence platforms. There is one even bigger competitor: the consultancy industry. Quid’s target customers currently spend millions and millions of dollars on consultants. “What they get out of that is a Powerpoint presentation and a 200-page strategic document. They like us because we put the decisions back in their hands. You can give this to a C-level executive and show him the world that he is dealing with.”
Quid is based in San Francisco, has 50 employees and has raised $14 million from Niklas Zennstrom’s Atomico Ventures, Ron Conway’s SV Angel, Peter Thiel’s Founders Fund and others.