Page 64 - Forbes - Asia (April 2019)
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TECHNOLOGY
The firm’s breakthrough year was 2014, when Enigma find ways through machine learning of connecting the data,”
raised $4.5 million from Comcast, American Express and the Baxter says. “When you combine that external data with our
New York Times Co. and entered the Fintech Innovation Lab, internal domain data, then you start to get phenomenally
created by Accenture and the Partnership Fund for New York predictive and insightful trends.”
City. There, embedded with banks and Wall Street giants, Investor John Fogelsong of Glynn Capital thinks the start-
Oudghiri and DaCosta discovered that their data was useful up could present a threat to legacy closed-system “big box”
to financial services. Its information could be connected with technology vendors like Oracle, IBM, SAS and SAP: “Each
data in the banks’ systems, helping them more quickly recog- new data set Enigma ingests compounds the company’s abili-
nize fraud or businesses to underwrite. “We walked out with ty to improve a customer’s business processes.”
a battle plan,” DaCosta says of the accelerator. They quickly BlackRock’s recent experience is illustrative. When Frank
built a software package, and put specialized tools into a com- Cooper, its newly minted chief marketing officer, was asked
pliance interface they called Dossier. to shake up how the $6-trillion-in-assets firm prospects for
To date, Enigma has synthesized 100,000 data sets in more clients, Enigma made a surprising discovery: Contrary to the
than 100 countries, organized intelligence on 30 million small traditional approach based on regional and demographic tar-
businesses and accumulated 140 billion points of data on the geting, there was little correlation between a client’s location
U.S. population. Braininess permeates Enigma’s headquarters and his or her preparedness for retirement, but political en-
in New York’s Flatiron District: Conference rooms are named gagement ranked high. “If someone is politically active and
after philosophers like Michel de Montaigne and Augustine. even if they are a renter, they’re much more likely to plan for
But Enigma’s nerdy culture hasn’t stopped it from attract- retirement,” Cooper says. “It was shocking for us.”
ing corporate clients and funding from Silicon Valley and Not all of Enigma’s machine-learning algorithms are for
Wall Street. BlackRock, PayPal, American Express, MetLife, making profits. The firm has volunteered its data efforts to-
BB&T, Celgene, Merck and EMD Mil- ward studying the gender gap across
lipore have signed up. The firm has ENIGMA HAS SYNTHESIZED 558 occupations and has already iden-
raised some $130 million in the past 100,000 DATA SETS IN MORE tified that some of the most egregious
seven years from venture investors like THAN 100 COUNTRIES, disparities occur in accounting, retail
New Enterprise Associates, Crosslink ORGANIZED INTELLIGENCE and sales. After a November 2014 fire
Capital and Glynn Capital, and hedge ON 30 MILLION SMALL killed five people in a smoke-detec-
funds like Two Sigma Ventures and BUSINESSES AND tor-less home in New Orleans, Enigma
Third Point Ventures. Forbes estimates ACCUMULATED 140 BILLION worked with the city’s fire department
Enigma’s valuation is $750 million, POINTS OF DATA ON THE and Office of Performance & Account-
with revenues pushing $30 million an- U.S. POPULATION. ability to identify areas where fire safe-
nually, the company having doubled ty is weakest.
its customer base in 2018. On Enigma’s public website, it of-
If a hedge fund wants to know fers national fire-incident data free
which restaurant chains are growing the fastest, Enigma can for city planners to use, and 50 years of weather anomalies in
check FCC logs for radio licenses, which are required to open the U.S., plus nationwide data sets on everything from cancer
drive-through windows. Insurers use Enigma for risk assess- statistics to so-called adverse events, as defined by the Food
ment, and pharma companies query its data-crunching ma- and Drug Administration. In New York City, for example, an
chines to improve drug safety. Enigma FOIA allowed it to synthesize years of rail incident
Want to quickly and precisely identify the best candidates and injury data reported to the Metropolitan Transportation
for small business loans? Instead of cold-calling storefronts Authority. The firm is also working with a nonprofit called
or schmoozing local Chamber of Commerce officials, Enig- Polaris to combat and prevent slavery and human trafficking.
ma will synthesize property-tax filing information with state The idea is that data can not only lead to better underwriting
business filings and Uniform Commercial Code liens to come but also improve government. Oudghiri and DaCosta call it
up with automated credit identities. Need to avoid under- “data for social good.”
writing in risky fire zones? Why not sew together data sets on Is Enigma vulnerable to the kind of data-usage scandals
emergency-call logs and building permits? that have plagued Facebook? “I think the behavior from the in-
At MetLife, chief digital officer Greg Baxter is starting to ternet companies has been suspicious if not malicious, creat-
use Enigma data pulled from public health systems and uni- ing a picture of your behavior that is probably above and be-
versities by connecting it to its own systems to detect pockets yond what you would consent to,” Oudghiri says, arguing that
of illness or risk and to improve underwriting. In MetLife’s Enigma’s work with financial services firms strikes a more mu-
$588 billion investment management arm, Baxter is using tually beneficial covenant. “Your data is a means to understand
Enigma data to quantify how the quality of restaurants, parks if you are a legitimate person,” he says. “From a privacy stand-
and community event spaces affects real estate prices. “They point, you enter those relationships knowingly and explicitly.
discover data sources, they organize the data and then they The need for sharing data arises from a pretty good place.” F
60 | FORBES ASIA APRIL 2019
