CHICAGO, IL, Narrative Science, a platform that automatically translates data into narratives, raised $11 million in funding.
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Accorrding to Crain's Chicago Business, a generation after MBA students and consultants figured out how to turn piles of numbers into charts and graphs to make them more understandable, we're drowning in pies, bars and scatter plots. Trouble is, it's not always clear what those images mean. Narrative Science's software can explain it by turning numbers into stories. It can figure out not only what's in a chart, but what's most important, and summarize it in real time.
"People like to read," says Jai Das, a partner at Sapphire Ventures in Palo Alto, Calif., which just led an $11 million follow-up investment in Narrative Science alongside Chicago venture fund Jump Capital.
Over the past 18 months, Narrative Science's technology has been incorporated into business intelligence software made by Qlik, Tableau, Microsoft, Sisense and SAP. It's a big leap in the evolution of the artificial intelligence spinout from Northwestern University. The company's core product, Quill, is used by government and financial customers to turn mounds of data into intelligible reports faster and cheaper. Piggybacking on products sold by others could accelerate Narrative Science's growth while keeping costs down. CEO Stuart Frankel predicts such partnerships could become half his business within a couple of years.
But Narrative Science may be on to something even bigger. Some technologists are betting that voice could become the dominant way we interact with computers and other devices, based on the surprising popularity of Amazon devices using its Alexa interface or, to a lesser extent, of Apple's iPhone assistant, Siri.
Narrative Science's specialty is natural-language generation software, which turns data into human-sounding stories. It's not a stretch to think it could turn data into a conversation. "The world still communicates in language, whether it's written or spoken," Frankel says. "It's clear voice is going to be the next UI (user interface)."
Sisense, a data analytics company in New York, began incorporating Alexa to make its product easier to use, then added Narrative Science's capabilities late last year. Sisense showed them off at a recent industry conference. "Alexa's great, but limited," says Guy Levy-Yurista, the company's head of product. "It could tell me what I could see on the screen that was obvious. Narrative Science can interpret the data and predict. We gather data, and they allow you to ask questions of it."
SPENDING TO RISE
International Data, a researcher in Framingham, Mass., predicts that spending on analytics and artificial intelligence will balloon to $47 billion by 2020 from $8 billion last year. It will be highest in banking and retail, followed by health care and manufacturing. Also rising quickly is worldwide funding of AI-based startups, which hit $5 billion last year: That's double from 2014 and more than eight times higher than in 2012, according to CB Insights, a New York-based research firm.
Narrative Science added 25 employees over the past year and now has 100 workers. The company, which has raised $43 million altogether, recently opened an office in Seattle, near both Microsoft and Tableau. It was a pioneer in natural-language generation software, along with Automated Insights, a startup in Durham, N.C., that sold two years ago for $80 million and now is part of Chicago-based Stats. Frankel declines to disclose revenue.
It's been a long road. Narrative Science got its start in 2010 turning statistics into news stories, particularly sports and business summaries from box scores and financial reports. As it moved into bigger markets, such as financial services and government, the core software has been rewritten three times.
"It's technology that's trying to figure out what the killer use case is," says Dave Schubmehl, a research director at International Data. "There's opportunity here. Everyone's waiting to see what Amazon and Samsung do with the technology. I wouldn't be surprised to see a licensing deal with these companies."
That's just one possibility. In the past seven years, Frankel, 51, has learned not to limit his thinking to a particular outcome.
"Voice doesn't have to happen," he says. "We win as long as people want information back in a way they understand, whether it's static or interactive. That said, I don't think that the genie is going back in the bottle. Voice-enabled interfaces like Amazon Alexa will be in pervasive use in the next few years."