Why we invested in Gravity AI

mediumThis post was originally published by Frontier Ventures at Medium [AI]

Machine Learning. Artificial Intelligence. Simply mentioning these fields conjures up images inspired by science fiction. Robots that compose music and write novels. Computers that mimic human emotion and predict the future. Yet despite the futuristic visions that these subjects conjure, the reality of AI/ML, on the operations side, has much in common with the past. In the early days of the internet, web developers, the trailblazers of their time, built almost everything from scratch.

Today’s trailblazers in software, AI and ML engineers, have to build their projects from scratch as well. In the 70’s and 80’s, users paid an hourly rate to rent time to use computers. Today’s data scientists also have to pay cloud vendors for processing time by the hour — hours that are mostly used to train ML models. Why are data science operations so inefficient? The reason is simple: enterprises want the benefits that AI/ML bring, but feel that building AI/ML projects from scratch is a more secure process. In order to reap the benefits of sophisticated computation, enterprises feel that they have no choice but to begrudgingly accept the unpredictably variable costs, complicated legal processes, wasted time, and high project failure rate as the costs of doing business.

But enterprises do have a choice — and the solution comes in the form of a classic business model with a modern twist: a marketplace — but one that’s fine tuned for the demands of the enterprise. Enter Gravity AI. Gravity AI’s marketplace of AI/ML models solves problems for multiple stakeholders within the enterprise. Gravity AI analyzes each of the models on its marketplace to make sure that they are ethical and secure, taking much of the pressure and stress off of their clients’ compliance and security teams. AI/ML development teams, confident in the security of Gravity AI’s models, are freed from the burden of building entire projects from the ground up: they purchase the more elementary parts of their models from Gravity AI and then spend more of their time writing innovative and original code. Moreover, since Gravity AI’s marketplace is also curated for quality, AI/ML teams work with the confidence that their projects will succeed. Finally, Gravity AI has flat pricing, which makes the cost of machine learning operations lower and more predictable — an aspect of Gravity AI appreciated by its clients’ finance and operations professionals!

For many founding teams, there’s generally one business person and one technical person. The business person generally handles fundraising, recruiting, marketing, and everything else not related to actually building the product, while the technical person is heads down writing software. Gravity AI breaks the founding team stereotype. Gravity AI’s CTO, Jon Huss, given his eighteen years of software engineering experience is clearly the more technical of the two, but Daniel Huss, Gravity AI’s CEO, as demonstrated by his experience building AI products at BCG Digital Ventures and as Head of Product at State Street, is technically gifted as well. Both founders have directly felt the pain of inefficient AI/ML processes, and so have additional motivation to succeed in bringing Gravity AI to a global marketplace.

In the consumer internet space, marketplaces were some of the largest and earliest successes. Amazon, eBay, and Priceline.com all grew rapidly during the dotcom bubble and withstood the dotcom crash to become household names today. Enterprise, or B2B marketplaces, have not enjoyed as much success — at least not yet. In our view, the next 10 years will see many enterprise marketplace unicorns. What makes this era different from the internet 1.0 era? Robust electronic payments systems, and faster networks are all key reasons, but also playing a large role are business models that encourage marketplaces to address the critical pain points of both large enterprises and small vendors: Enterprise Gateway Marketplaces.

Enterprise Gateway Marketplaces (EGMs) have the same network effects as traditional two-sided marketplaces. They grow in value as they become more popular. They become more defensible as they scale. What makes EGMs particularly interesting is how they connect thousands of small vendors with large enterprises. Traditionally, small vendors got access to large enterprises either via long and expensive bidding processes or through private and privileged relationships. EGMs, enable enterprises to quickly and efficiently identify and then transact with the best small/medium size vendors. EGMs handle the contracting, compliance, and other red tape on behalf of vendors, resulting in a two key benefits: a larger vendor ecosystem and faster transactions. Gravity AI is an EGM that hones in on the most important factor in making B2B marketplaces successful: trust. We also are excited in Gravity because we believe that B2B software EGMs will be some of the first major success stories in the B2B marketplace space.

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This post was originally published by Frontier Ventures at Medium [AI]

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