Swedish Eqt, born in 1994 as the Wallenberg industrial group’s investment arm, has gradually evolved into one of the world’s leading private capital managers, with 224 bn euro under management, distributed over a wide spectrum of asset classes, ranging from venture capital to private equity, from infrastructure to real estate. In 2016 Eqt stepped into the AI world, investing in the sector but first and foremost launching Motherbrain, a dramatically innovative Artificial Intelligence-based approach to investment targeting, that was at first applied to Venture Cpital, and later on to almost all other asset classes Eqt deals with. Motherbrain’s research head Lele Cao, due to present his creature at the 0100 Mediterranean Conference 2023, focusing on private capital investments in the Mediterranean Basin, that will be held in Rome on the 18th of October, explained to BeBeez International (the conference media partner) the basic principles Motherbrain is based on.
BeBeez International: How is Motherbrain organized?
Cao: It is articulated in three divisions, Labs, Platform and Research, employing around 30 people.Labs performs the day to day operations, i.e. the tasks commanded by Eqt’s investment teams. Platform is essentially an engineering unit, developing new analytic tool again upon investment managers’ input. Finally, Research, which employs just three people, studies how to improve knowledge acquiring, also by implementing newly developing technologies to enlarge and effectively manage our knowledge base. Of course, any development stems also from the continuous interaction between Motherbrain’s technicians and Eqt’s investors.
BeBeez International: What does Motherbrain actually do?
Cao: We scan a huge database, constantly fed by a wide range of data sources, upon instructions we receive from investment teams, to provide them with several types of information helping in selecting potential investments featuring a high likelihood of success. But not only that. We can provide EQT with information that is relevant not only to investment managers but also to Eqt’s portfolio companies.
BeBeez International: For instance?
Cao: A typical example is the search of talents or M&A targets an invested company needs to boost sales or to introduce a new technology. We may also run sensitivity analyses to test, say, the resilience of an invested or investable company to external shocks.
BeBeez International: Which data do you use to run those evaluations?
Cao: All sorts of information, from market and sector data to press news and even social media posts. Knowledge acquiring indeed consists basically of linking different sets of data relating to concepts and entities.
BeBeez International: What is Motherbrain’s track record?
Cao: Since its birth it has scanned, on a regular basis, some 50 million companies on the basis of a long list of topics.
BeBeez International: ESG has nowadays turned one of the hottest topics concerning investment strategies. Which way can Motherbrain help EQT’s portfolio managers.
Cao: The central issue about ESG investing is the availability of relevant data on suitable companies. Of course the knowledge base gets larger and larger as the number of data sources and past experience increase. On the other hand, that holds true for all other functionalities, which evolve fast, thus improving the system’s performance steadily.
BeBeez International: In 2023 EQT started to employ also ChatGBT-like technologies to further strengthen the potential of Motherbrain.
Cao: We are developing our own application utilizing large language model, but there is still a lot of work to do on that, particularly on the interaction with our knowledge graphs-based information and technology.
