The company has now raised over $106 million in venture fundingRead more...
The company recently raised a $16M round from Mark Cuban, JetBlue and Will Smith's Dreamer Fund
Artificial intelligence is something that is almost a perquisite for every tech company nowadays to talk about, to the point where its become something of a buzzword in Silicon Valley. What exactly they mean when they say "AI," what data are they using and how exactly are they able to do with that technology isn't always clear.
The answer, according to Falon Fatemi, founder and CEO of Node, isn't all that advanced: it still usually involves humans using data to make predictions, a process that is both costly and also doesn't result in the type of outcomes that can truly help organizations make better decisions.
"What most organizations are doing today is hiring really expensive data scientists, a human, to look at a complex problem. Like, say, ‘I want to find more employees like my best employees. We don’t even know what makes our best employees, we just know who they are.' Humans use our intuition to come to that kind of a conclusion and what you end up with is these deterministic approaches that, frankly, end up resulting in not real prediction but rather fancy data analysis," she told me in an interview.
That's why she founded Node, a company that just last week unveiled a new type of AI, called Artificial Intuition, which uses deep learning to help enterprise organizations make better predictions around such questions as what clients to go after, which employees to hire and other decisions that have an impact on their bottom line.
The origins of Node
Fatemi is a former Googler who, at age 19, became the youngest employee at the company. After spending six years there, working on go-to-market strategy, global expansion, and strategic partnerships at Google and YouTube, she then spent another six years in the startup world, where she did strategy consulting for startups and ventures capitalists, while also doing "a lot of matchmaking between people and companies and resources."
It was at this point, she told me, that she decided to do an analysis of all the introductions she had made over the six years she was in the startup world, and came to some interesting conclusions.
"What I uncovered was that a majority of those introductions had resulted in some sort of life changing outcome for those individuals or businesses. For example, I found out my introductions have led to millions in investments, a number of acquisitions, sales and marketing partnerships, hires, marriages, even a merger. That was the ‘a ha’ moment where I realized, ‘What if I could productize the intuition I had behind uncovering all these connections that result in these transformative outcomes?’ That’s really where the vision for the company was born," she explained.
"Our vision, as a company, is to connect people with opportunities at massive scale."
Node's team now includes Louis Monier, who created the search engine Alta Vista, who Fatemi calls, "the Godfather of Search," and Michael Radovancevich, the former CTO of talent platform Taleo and advertising network OpenX.
"Together, we’ve invented what we call Artificial Intuition. Essentially, this enables organizations to be able to put the power of prediction into their applications, and, in turn, be able to enable the users of their applications to be able to see into the future," she explained. "We’ve essentially packaged up this technology into the first turnkey AI-as-a-service platform that enables organization to leverage existing resources, so any application developer that can integrate with a simple robust API is able to have a hand in creating the future."
AI in the enterprise
Node's current customers are in the enterprise, because, she told me, that's where the next wave of transformation will be coming from, and AI is going to have a huge effect on the space going forward.
"AI is going to be a wrecking ball to the enterprise for the companies that don’t adopt it and this is going to happen in the next give to ten years. AI is not only accelerating the pace of innovation but also the decline of the companies; I think in the last 20 years over 50 percent of the Fortune 500 have disappeared, and more so than that, the life expectancy has dramatically decreased. In 1955, the life expectancy of a Fortune 500 company was 75 years, in 2015 it was 15 years and that doesn’t even take into consideration the AI playing a part in that. So, we believe by 2025, imagine where we’re going to be," she said.
"Essentially, what our platform does is help these organizations that maybe have built legacy system on top of legacy system, whose ability, therefore, to adopt an AI solution is near impossible. There’s lots of challenges: they don’t know how to do it, they spend millions in failed AI experiments, there’s not enough data scientists out there, and we basically reduced that to using any of their existing engineering resources. Anyone that can integrate with a very simple rest API to within a day be able to build a prediction model and scale it out to their end customers via their application, and that’s all done via Node."
For example, one of Node's customers is sales productivity tool Yesware, which partnered with Node "to essentially reinvent the future of their space."
"If we look at how the space has evolved, it’s gone from having a system of record to having this powerful workflow automation engine that drive efficiency in terms of outreach but, frankly, results in spam in all of our inboxes. So, in leveraging Node, they’re putting the power of prediction into their application for their customers to enable sales reps to prioritize their time on the deals that are likely to close," said Fatemi.
As a result of partnering with Node, Yesware is projecting a 10 percent increase in win rates.
Another customer of Node's is an analytics company, which is using the platform to be able to build predictions around which clients or users of theirs are likely to churn.
"To determine whether a customer is going to renew or leave, the traditional thinking around it is that the frequency or quality of customer success or support is likely a big driver of it. What was really fascinating about what we identified as a system is able to predict accurately whether an organization is likely to be a detractor or a promoter before they’re even your customer. Think about that for a minute. Node’s engine has the power to allow end users to see into the future, armed with that information, and using our platform to drive these kinds of predictions, you would make a completely different set of choices as to which markets you go after or how you end up running or operating your business," she said.
"What’s so interesting about our platform is we all have our own intuitions about what makes a good customer or employer investments. Based on our intuition, which is very much informed by data, and, in some cases, these are often wrong bets complete, Node is giving enterprises a tool to challenge that. Essentially, you teach Node, and then it teaches you."
What makes Node different from other infrastructure players in the market such as AWS, and Microsoft Azure, she said, is that while they provide, "great individual tools that can help accelerate a piece of a data scientist’s process," they still require lengthy and expensive processes, like acquiring, cleaning and normalizing the data.
"What we are doing is, essentially, at a much higher level of that infrastructure stack, it’s actually at the application level and it’s not necessarily for a data scientist, although we do work with many; we help accelerate their ability to innovate on new features. We’re focused on enabling product development teams to focus on their core competency, which is not being an AI company themselves but to imagineer the next set of features that are going t be game-change for their industry and drive the business outcomes that they care about. We’re doing that by reducing something that takes millions and years, and a lot of risky AI experiments, to literally one full stack engineer in one day to prove out."
So far, Node has been able to drive 81 percent more accurate predictions than any old way of AI or deterministic approaches, resulting in over $200 million in revenue for its customers.
New funding round
In addition to unveiling its Artificial Intuition platform, Node also revealed last week that it raised $16 million in a funding round that brought its total raised to $36 million.
Investors in the new round included Node's existing investors, including Mark Cuban, Avalon Ventures, NEA, NewView Capital, GingerBread Capital, Canaan Partners, as well as new investors including JetBlue Technology Ventures, Will Smith’s Dreamers Fund, MS&AD, Wharton Alumni Fund, Plum Alley, and former Google and Microsoft executive James Whittaker.
"First of all, the fact that our investors are so eclectic demonstrates that they have a true diversity of perspective, but one thing they all align on is they see the game-changing power of our platform. If you think about this world that we’re entering into, where AI is absolutely going transform our lives from a personal and professional perspective, our platform has the potential to help enable and democratize innovation in a way that today is, frankly, stifled by these all these big tech companies that have the resources and are able to invest them. We believe, and our investors believe, that’s there’s going to be an entirely new wave of AI-first applications, and perhaps entrepreneurs, that are going to be building on top of Node because we act as a real accelerator for that and, frankly, enable them to be able to have a hand in creating the future and become the next Amazon or Google," she said.
"So, the fact that we have investors ranging from JetBlue to Will Smith’s Dreamers VC, obviously Mark Cuban and others, this is truly representative of that. Our technology, Artificial Intuition, it drives real prediction, or what we define as the ability to see the future, and that’s the power we’re trying to unleash. We’re one of the first to make this new reality possible so I think that’s what they’re representative of."
The new funding will go toward expanding the team, as well as developing more products and features to the platform, including some that include going beyond B2B and into consumer-driven companies as well.
"Today, our experience with consumer applications is very much based on the information that we give it, and it’s not highly personalized to you. So, imagine a world where you are getting recommendations for the relevant other people, companies, products, places, offerings, that are absolutely relevant to you, that you don’t even know to search for. That’s essentially a world where these applications are so intelligent and are able to get a sense of what’s most relevant to you before you even ask those questions," Fatemi said.
"In general, in the distant future, everyone should have the power of our Artificial Intuition technology working for them. Imagine that you have an intelligent agent whose job it is to identify, for you the next founders that you should speak before they even announce their fundraising. Or the next book that will change your life. There’s incredible potential here and we’re really excited to help accelerate that future."
The future of Artificial Intuition
What Node really represents, according to Fatemi, is a move away from the old approach to AI, which involves hire lots of data scientist, spending millions of dollars and years only 'to result in is basically nothing more than fancy data analysis to leveraging deep learning."
"This is a new way of AI, where these deep models learn from the data interactions themselves. I 100 percent am seeing, and believing, that neural networks and deep learning are absolutely the right tool for the job, especially as it relates to complex problems and really driving true predictions. We, ourselves, are very familiar, we went through this whole progression of technology from the old way of AI to the new way of AI, and now our clients are benefiting from those results," she told me.
"Success for Node is being that AI layer in all applications in the future that are driving the personalization that’s powering prediction and enabling end users to really be able to get a glimpse into the future and make smarter decisions and connections that drive the outcomes that they care about. To us, that is the fastest path of fulfilling our vision of connecting people with opportunity at massive scale. It’s to democratize Node Artificial Intuition so that any company can leverage it and help create the future. I keep going back to that and I get so excited about it because there’s an unlimited set of features and products that can be built on top of our platform and I am excited to see where our customers take it."
(Correction: this story previously indicated that Node's customer was "Yesler" instead of "Yesware")
Read more from our "Trends and news" series
In-app spending jumped over 23 percent to $50.1B year-to-year through the first half of 2020Read more...
The company does what it calls a "metabolic reset," which is designed to each person's biologyRead more...
Related Companies, Investors, and Entrepreneurs
Joined Vator on
Node is the first automated machine learning solution designed for platforms that leverage people and company data. Powered by Artificial Intuition™ technology, Node enables product development teams to create and deploy AI-powered predictive feature sets for both customer-facing and internal use applications, all via a standard API that can be set up in minutes.
Joined Vator onFalon Fatemi is the CEO of Node.io, the first AI-as-a-service platform that enables users of business applications to see into the future. Previously at age 19, Falon was the youngest Googler and in Fast Co's top 100 most creative people in business.