This article was originally posted as a part of Helsinki Fintech Guide 2021 on June 23rd, 2021. You can download the full publication over here. Please note that the funding information in this article is no longer up to date after the latest round on September 30th.
AlphaSense is a revolutionary AI-powered search engine for market intelligence used by financial firms and corporations across industries and geographies. With more than 1,000 enterprise clients, their mission is to enable knowledge professionals to acquire critical business insights and data to make decisions with speed and conviction. AlphaSense’s search technology leverages AI and natural language processing to parse topics, concepts and ideas semantically and uncover the most relevant insights from previously fragmented data sets. Founded in 2011 by Jaakko (Jack) Kokko and Raj Neervannan, today the fintech company has raised funding in total of 90M$.
WHAT DOES ALPHASENSE DO?
AlphaSense is a search engine for market intelligence that transforms how decisions are made by the world’s leading corporations and financial institutions. Leveraging AI and NLP technology, much of which is built by our Helsinki team, AlphaSense enables financial professionals and other knowledge workers to extract insights in seconds from thousands of previously disparate business data sources, including company filings, event transcripts, news and trade journals, and equity research.
WHO ARE THE FOUNDERS AND HOW WAS THE IDEA BORN TO FOUND ALPHASENSE?
“I grew up in Oulu, and spent my final year of high school in the United States. I then earned a degree in electrical engineering from the University of Oulu, then a degree in finance from Helsinki School of Economics. After college, I became a financial analyst for Morgan Stanley, first in London, then in California, which is where I experienced the pain AlphaSense solves today’’, tells Jaakko Kokko, the co-founder and CEO of AlphaSense.
‘’As an analyst for Morgan Stanley’s tech group, I spent countless hours, nights, and weekends reading and CTRL-F searching through company documents and market research only to still feel like I was missing critical information that could put a billion-dollar deal at risk.
A few years later, after founding and leading another company in Silicon Valley, I embarked on my MBA at Wharton, which is where I met AlphaSense’s co-founder and CTO, Raj Neervannan. It was during our time at Wharton (2006-2008) that I was shocked to realize it was still incredibly difficult and manual to find information, which is when Raj and I began to conceptualize the idea for AlphaSense.’
WHERE DOES ALPHASENSE CURRENTLY HAVE OFFICES? WHAT IS THE REASON FOR THE LOCATION CHOICES?
HELSINKI, which is the technology headquarters and functions as an engineering and product development office. This location was chosen because of the incredible software development talent available in Finland and the nearby region.
NEW YORK, which is the global business headquarters, and is where the majority of the executive leadership team, and sales, marketing, and finance teams are based.
MUMBAI AND PUNE, which are also primarily engineering and product development.
LONDON, which is a sales office for the EMEA market.
HOW DID THE GROWTH AND CUSTOMER ACQUISITION OF ALPHASENSE BEGIN? WHAT KIND OF CHALLENGES DID YOU FACE AND HOW DID YOU OVERCOME THEM?
‘’AlphaSense initially began as a solution for investment firms and hedge funds, which is in part because of my background and expertise. A natural progression from there was to corporate investor relations teams because they conduct similar research and need similar access to content like earnings call transcripts and company filings. Our expansion to IR was our initial entryway into the corporate market. From there, with the addition of more content sets including news, trade journals, regulatory content, and Wall Street Insights, which provides unprecedented access to premium equity research for the corporate market, we’ve expanded rapidly in corporates, and are now widely used by additional functions such as competitive intelligence, corporate strategy, M&A, and many more.
Of course, one of the most challenging aspects of building AlphaSense was developing ML and NLP that’s sophisticated enough to recognize the nuance and variation of the financial and business information our users seek from diverse and dense content sets. That’s what the first several years were focused on.
However, as sophisticated as our AI is, it’s only valuable to our users when it surfaces insights from content that’s mission-critical to them. Developing partnerships with countless premium content providers has also been a constant focus, and though it was challenging in the early days, we’ve been fortunate to build a well-known brand and impressive client roster that’s enabled some major breakthroughs in this area in recent years, particularly with our Wall Street Insights offering, which now provides unprecedented access to equity research from the majority of the world’s leading investment banks’’.
WHAT HAS BEEN YOUR SECRET INGREDIENT IN ATTRACTING S&P 100 AND 70% OF THE TOP 50 HEDGE FUNDS AS CUSTOMERS?
‘’The secret is really the quality of our product, which has exceptional product-market fit, and a wide, horizontal market. Additionally, it’s the strength of the team, who have been on the front lines of taking the product to market’, Jaakko Kokko states.
WHAT KIND OF ROLE DOES THE FINLAND OFFICE PLAY IN ALPHASENSE’S BUSINESS?
Since day one, our Finnish office has been our technology headquarters for AlphaSense – acting as the center of gravity for our core architecture and platform development.
Over the years we’ve not only been able to build an incredible team through local talent, but have benefited from how attractive Finland is to expats, enabling us to draw great talent from all over the world.
As the footprint of our Product Development Organization has grown – now spanning the US and India, Finland plays a critical role in binding our global operations and establishing the key strategies for Engineering & Program Management for all offices’’.
WHAT ARE THE STRENGTHS OF THE FINNISH ENGINEERING?
’We strive to hire the best, and we value integrity, excellence, respect, inclusion, and collaboration – encouraging independent decision-making to accelerate problem-solving and speed to which we can deliver great user experiences.
Our Finnish office has an abundance of incredibly talented team members across all disciplines – Engineering, Program Management & Quality Assurance – all of whom exhibit these values and are the bedrock of our engineering culture today’’.
HOW BEING FINNISH-ORIGIN STARTUP CAN BE SEEN IN YOUR COMPANY CULTURE – IS SISU CULTIVATED IN YOUR COMPANY’S DNA?
‘’Sisu is a huge part of our DNA. It’s one of our core values, and it’s what gave Raj and I the determination and persistence to build AlphaSense, and it’s our entire global team’s Northstar. We hire for sisu and we coach on the importance and value of it regularly with our team’’.
HOW HAVE YOU WOWED YOUR VC INVESTORS AND WHAT KIND OF ADDED VALUE HAVE THEY BROUGHT TO ALPHASENSE IN ADDITION TO FUNDING?
‘’Our investors have been impressed with the product, its wide market appeal, and our vision for it since the very beginning. Being investors themselves, they’ve seen first-hand the value and deeply understand the pain it solves for, and many are active users of the product themselves. Additionally, they’ve been ‘wowed’ by our strong business performance, especially in spite of all the market uncertainty last year with COVID.”
WHAT KIND OF EXPANSION PLANS OR NEW PRODUCT LAUNCHES YOU HAVE COMING UP ARE YOU EXCITED TO SHARE WITH US?
‘’The features and functionality of our product fall into four categories, which we are continually investing heavily in:
- Search, which enables users to uncover insights rapidly and confidently through the power of AI
- Summarization, which leverages the sophistication of our AI to surface and summarize thematic and company insights
- Monitoring, which delivers relevant content and insights to users on the companies and topics they cover in real-time
- Workflow, which streamlines the research process for our users and their organizations
Additionally, we’re continuing to invest in providing the most comprehensive content set for our users’’.
AND LASTLY, WHEN WILL YOU BECOME A LISTED COMPANY AND IS THAT MOST PROBABLE IN NYSE?
‘’We have an ambitious product vision and aggressive growth plans for AlphaSense, and for now we are focused on those as our key objectives’. When you do that and execute well, the right things follow, including a path to the public markets”, Jaakko concludes.