Artificial intelligence doesn’t look like the Terminator, and it doesn’t have to cost millions of dollars. One new AI product is selling itself to Wall Street for just $10.
New York-based Braxton McKee is just one of many computer gurus developing fast and cheap AI for the finance world, reports Bloomberg. McKee founded Ufora in 2011, using the cloud to allow hedge funds and others in financial services to run complex, big-data models. With the easy access of cloud computing, his data analysis can take on millions of rows and columns in a trillion entries for less than the cost of lunch in Manhattan.
Only five years ago, the trillion data points McKee can tackle in minutes would have take months of coding and more than $1 million in hardware. Now McKee can work through Amazon Web Services on what he calls “coffee time.” He tries to make every model compute in the time it takes him to casually meander to his kitchen, make himself a cup of coffee, and wander back to his desk, no matter how complex that data.
Quant hedge funds have been playing with technology for years. McKee used to work as a programmer for Ellington Management Group, a credit hedge fund, and has gotten backing from the large quant firm Two Sigma Investments. Three Bridgewater Associates vets have recently left their hedge fund to start their own data firm, Domino Data Lab.
Cheap access to booming technology is certainly helping the startup industry, and financial services. Last year 16 AI companies got venture capital backing, up from only two in 2010. And the amount invested has jumped to $309.2 million in 2014, from just $14.9 million in 2010. Writes Bloomberg:
“Automotive manufacturing, the U.S. government, pharmaceutical firms — we’re seeing sophisticated analytical need across the board,” said Matthew Granade, formerly co-head of research at Bridgewater. “Hedge funds seem to think of themselves as on the cutting edge. They are, on some level. But the rest of the world is moving very fast as well.”
Photo: OTA Photos via Flickr.