If there’s one thing that’s true – data lies. Data lies a lot.
In “Everybody Lies: Big Data, New Data and What the Internet can tell us about who we really are”, Stephens-Davidowitz writes: “Big data allows us to finally see what people really want and really do, not what they say they want and say they do. Providing honest data is the second power of Big Data.”
But ‘honest data’ doesn’t come easy, and Crayon Data knows that well.
Founded in 2012, the Singapore-based Crayon Data has an AI algorithm which analyses consumer data to acquire customers for clients like Emirates Airlines, regional banks and hotels.
“One thing we’ve realised over the years, is that consumer behaviour cannot be so easily predicted from social media reactions like Facebook Likes and Twitter shares,” said Suresh Shankar, founder of Crayon Data.
“Let me give you an example. Let’s say I post something online about a Ferrari and you “Like” it. Are you liking Ferrari or are you liking Suresh’s post? There’s no real way to know. There’s a lot of noise out there. There’s a lot of data available, but it’s not powerful in prediction.”
Crayon claims its algorithm is smart enough even to predict offline behaviour, a crucial aspect for Southeast Asia where a majority of transactions still take place off the grid.
It also promises customer data privacy – a great thing to have, but challenging if the company needs to profit from the very same data it needs more of.
Add to that – an escalating climate around data protection and localisation, and suddenly the big data business doesn’t seem like a merry place to be in at all.
Crayon Data has one bright spot: it is already profitable.
It has solid set of backers to show for investor confidence including Kris Gopalakrishnan, Ratan Tata and Mitsui & Co. Last month, Crayon announced it was raising $11 million in its Series B round to fuel its expansion into markets like the US, UK and Australia.
Moving forward, Shankar plans to strengthen Crayon’s legal team, and potentially spin its legal and security arm out of the core business.
“We’re working on making changes to our current model where we want to build more of an ecosystem play where our platform sits in the center, between the data providers and our clients, who are users of the data…It wouldn’t just alter things from a cost perspective. It will also change the way our clients see their customers completely,” said Shankar.
According to Shankar, 15 to 20 per cent of Crayon’s total expenditure is on acquiring data. The bulk of however, remains with talent at 60 per cent. Shankar, however, foresees compliance costs rising in future.
