Episode 155: Navigating the AI Revolution in Stock Analysis

Mike O'Neill: Welcome back to Get Unstuck and On Target I'm Mike O'Neill with Bench Builders and whether we're working with supervisors to improve their people skills or it's me coaching a leader one on one getting leaders and companies unstuck is at the heart of everything we do and that's exactly what this podcast is all about

joining me it's Gabriel Diamant

Gaby is the co founder and CEO of BridgeWise

Bridgewise is an Israeli based research company whose technology offers AI based stock analysis of essentially all public companies and in all languages regular listeners know I love bringing on to the podcast company founders and I'm looking forward to our conversation

Gaby welcome Gaby

Gaby Diamant: thank you so much for having me hi Mike

Mike O'Neill: Gaby as a starting point since a number of our listeners might not be familiar with the investing space and how your technology helps them could you put that in language that would probably be understandable by most what does your company do in short

Gaby Diamant: basically what we see is the market is Pretty much broken the upcoming force of the capital market is the individual investor while people think about individual investor they see them as the less equipped investor actually this is exactly the opposite of how they get themselves and they don't think they need to have any less information than the professional investor have

but they are they are facing few challenges okay out of the entire market basically you see that most of the sales side analysis actually focused on blue chip American companies in English while we love America and we know that America is the largest market of capital markets it still has it still signified a very very small portion of the entire universe that creates a very Strange situation where the individual investor will mostly invest by technical analysis By recent event by news read by the reddit by the reddit News or whatever is frank told him basically if we sum it up he will invest by his hunch This creates actually an arbitrage Individual investor will lose money nominally While the professional investor will peg himself to the benchmarks

some will win some will use but we lose but the expectancy is very very positive and this is what we came to resolve how do we resolve it we actually analyze 44 000 companies globally it doesn't matter if it's a an Israeli company a Chinese company a Spanish company or you or U s company and cover every company from 10 million and up

basically every relevant public company this create actually This gets gets us off the under the flashlight the vision and we see what is hidden in plain sight the way we do it is we do it through two IPs the first IP is a very sophisticated algorithm that is enabled to analyze company based on its fundamental and created created an edited value

we do it up to 48 hours after every company releases its public reports the second one is we use a proprietary generative AI micro language model that we have developed to create a structured report in any language and basically right now we have over 1 5 million customers that are looking into this report and we have over 35 institutional clients

that are made that are taking uses of

Mike O'Neill: goodness gracious so let me see if I heard some of this correctly and that is you're trying to put good information in the hands of an investor who typically does not have access to the depth of information that you can provide and what I think I understood you to say is that if you total up the number of publicly traded companies it's 44 000 plus Companies

Gaby Diamant: so I want to actually sharpen the first the first phase not only that we aggregate the data actually we give the opinion when you go to check GPT and you ask him what do you think about Tesla is it worthwhile investing it will tell you you need to go to investment advisor okay it can it can say it in multiple in multiple variations

we are a financial advisor we are licensed in multiple regions across the world and we actually analyze 44 000 companies and given a bottom line by our over performed hold under performed or sell but we cover them on also in the fundamental analysis we cover sentimental we cover technical and even ESG

Mike O'Neill: I got you you know something I didn't realize also is the number of exchanges that are out there I thought I could count maybe on a hand or two the number of exchanges but am I right there's like 130 plus exchanges throughout the world

Gaby Diamant: there are 136 I think uh exchanges that have significant volumes of transactions

I think that there are over 200 registered uh registered exchanges

Mike O'Neill: so I'm getting a better understanding of the scope of the services and and how you provide that there's something else that we haven't talked about and that is the ability to provide this type of analysis and I don't know if the right term is is investor Uh advisement but you're able to do so in many different languages

Gaby Diamant: exactly

Mike O'Neill: goodness gracious /

Gaby Diamant: okay basically we we have built uh we've built a language model that is enabled enabling us and I won't I don't I won't get to details because then it will become really boring but it's enabled us to move from English to any other language without the without lose of every quality of the of the language

the ability to do so creates the amazing situation that I can create a report on Itaúben from Brazil in English and I can create a report about Tesla in Portuguese basically this is by the way Bridgeridge is a new name why is it Bridgeridge because we're trying to bridge financial wisdom we're trying to eliminate barrier after barrier after barrier

so the the first and foremost is actually the barrier of money you don't need to be Very rich or very resourceful to get the research the second one is the education our reports are written in a way that the individual investor that has no financial uh financial academic background you will be able to read it in a very in a very easy way easy to read right

and the third one is the language and the language is a major obstacle uh we work a lot in Brazil in Brazil 95 percent of the investor does not speak English which means that all the all the analysis that is running around the world uh about the largest companies in the in the world Tesla JP Morgan does not is not relevant to them because it comes in a language that they don't understand

and you know it as well as I do that Google Finance won't copy

Mike O'Neill: that I do you know Gaby you are not only a co founder you're a CEO of a company that has grown pretty quickly you have employees um in different parts of the world can you elaborate a little bit about the process of how do you start your company

you mentioned that you you changed the name um to Bridgewise and I love the name for the reasons that you just but as a company founder now CEO did you find to be some of the challenges when you launched this business

Gaby Diamant: look um I had the I had the uh the luck the prerogative to found this company with my best friends

um We went to and we had a different startup before it and we sold it and what you will see most of the time it's that the founding team a lot of the time breaks and spread apart for us it was a hell of a ride for us and we just we couldn't get enough of it so we decided to do it again and we opened the company

and I will give you another fact that I wasn't the CEO to begin with we decided that we want to do it uh to do it as a full partnership we started as a hedge fund but it should it was supposed to be a full partnership everybody's take take his own territory so I was in charge of the technology that the other guy was in charge of the product

another guy on the sales and another guy on the operations and we worked extremely well and I will give you one of the challenges one of the challenges was after we raised the precede from two amazing angels we wanted to grow more and we started growing and everything went great but when we wanted to fund our second round a lot of VC says oh who's your CEO

mm who is your CEO so we decided we want to bring some someone from the outside and that actually created the problem that we I call it waiting for themselves to come okay waiting for someone outside of your scope outside of your core your core people to come and save you and this is the worst mistake every startup can do

because once you are waiting for some help that will come from the outside it means that you are moving your responsibility from the core team outside yes once the responsibility is not there the ability to grow to grow at the direction at the pace that you want to do is actually out of your control

and um so this was the main challenge we brought an amazing CEO I have nothing bad to say about him but I think it was doomed to it was doomed to fail because of the fact that we are as founders you know the company Sensei which was a spreadsheet and it it builds itself and there's dynamics and you failed so many times before trying to find product market fit that entering inserting someone from the outside and giving this Impossible

uh impossible mission of understanding the company taking back and learning everything that you have already learned and leading the company in the same way is almost impossible so I will tell you this was a pure challenge and basically although today I'm I'm um my title is a CEO we still work as a founding team

okay you will not see you will not see me coming and saying door or you need to do X and Y no we are founding team and I think that they are most of our strength our strength come from our ability to be united and I will give you another another small small challenge you need to be very egocentric as a company as a group not as an individual because every time we are failing we're taking it personal and we want and we want to prove and to grow and to and to improve

the the interesting stuff that everything that is relevant as a company as the individuals between the companies not only the founding partners we are completely selfless and we're like almost outpaced in within the company so I think this this combination is a combination that is very hard to find

Mike O'Neill: Gaby one thing that caught my attention about you and your company is kind of where you are from a developmental standpoint I have the good opportunity to work with other companies they're not necessarily startups but they're at a point that they realize somebody has to be in charge and this case it sounds like y'all came to a similar conclusion maybe from the outside world saying somebody needs to be in charge

but you said a couple of things that really did catch my attention you have the good fortune to have as co founders very close friends um and you also indicated that there has to be kind of a selfless mindset everybody has to be willing to kind of roll up their sleeves um because what you said is there will be setbacks mistakes and but you've got to kind of band together um through this has the friendship

though you're in a business relationship has it strengthened through this adversity

Gaby Diamant: definitely we started the first startup not as friends we as a people I I will give you the story about how we started I pitched uh my partner's father for another startup and he told me listen I like the idea I have a better one

i but I think that you are the strengths of this startup this was a like a standalone startup all by myself so and he told me listen I the idea is not strong enough but I think that you are strong enough I want to introduce you my two kids From now on to the rest of your life You are we are working together take this cent and a half and go build this startup with this idea that um that I have in my head for a long time

so it was a very I remember the we sat in a coffee house in Ramat Efal in Israel so I remember it till today and we didn't start it as friends and we actually went through a lot of challenges but right now we are as close as being family as possibly be um so it's strengthened and it's strengthening

Mike O'Neill: you know one of the things I do pick up on as companies grow oftentimes they struggle with maintaining that sense of family the the DNA seems to change what thoughts have you all given to see that as your success results that you don't lose sight of some of these core things that have defined y'all up to this point

Gaby Diamant: I didn't quite get the question

Mike O'Neill: the question I guess I would ask maybe a little differently is your company has a feel it has a culture it kind of is who you are and it's embodied by your fellow co founders as you grow I think you're at 50 plus employees as you grow and you're in different parts of the world

in what ways might you attempt to maintain that D n a that's in place that has worked so well up to this point so that's

Gaby Diamant: a perfect question I think the first thing is not it's nothing that you need to do especially for them we are touching every single employee every day yeah okay at least one of the of the four founders

okay we are touching every single employee every day There is not a day that one employee got To the end of the day without speaking to one of us Um the second thing is as you said as we spread apart globally we are flying all over Okay um so I was supposed to be in the u s right now but We opened the branch in the in the U S we have this we have the country manager Robert Truman care

and I came to him a month after that and I stayed there for for two and a half months to kick off the the country the ability to be there and to engage every day is what keeps the basically the structure very similar to what happened in Israel in Brazil I'm flying one of my offer team flies to Brazil

every single month you will not find months that one of us is not there and when hiring people we actually do uh we do a completed checks okay so if someone is going to product he will be interviewed from someone from the marketing if someone is going to the marketing will be interviewed by someone who go who is in the product or in the development most of them goes from me

and on top of that we have what we what is called the beer check okay do you want to drink beer with guy or not okay or a guy of course and on some occasion we actually created a real beer jack on the on the process on the process of hiring men and just went out to a drink to drink and we're constantly working on maintaining the spirit

and when something goes out of the spirit we know how to take care of it

Mike O'Neill: you know Gaby you shared a number of things that proved to be lessons learned mistakes made can you reflect on a time where perhaps you or a client got stuck and what did it take to get unstuck

Gaby Diamant: okay so I will take a very interesting situation

and we were in an amazing situation we were a growing company and we have 150 incoming leads but the number of closing was zero okay so that was the first thing that was a phase where we all stopped and said What is happening we get the traction but on the way to the closing something gets stuck

yes and what we did um we did a complete Restructure of the company this was when we decided by the way to set part with a previous CEO And we decided the company will be built as an arrowhead to close deals what does it mean we had a sdr team we eliminated it we changed it to account executives We went to the product and the product we tell them listen Those are your priorities if you come if you have a client that needs something fixed this is number one because the Because the easiest money to earn is the money you don't lose

number two if you have a guy that is about to close but you need to create a future for him integration for him this is a second priority everything else talk to me when you finish with the first one and basically we aligned from top to bottom the entire company to close deals once we passed this Rubicon we started bringing more leads

and again but this was a very pivotal period of our company

Mike O'Neill: I love the way you described I think you called it an arrowhead did I hear that correctly

Gaby Diamant: yes

Mike O'Neill: it obviously has worked but for it to work it required radical changes to how you literally were structured and how you conducted business um it showed a willingness to adapt and to adapt radically

one of the things I really enjoy with working with organizations your size is that that oftentimes is still the case as companies get larger they tend to get less flexible and as a result they begin to kind of hit a wall um you're providing a service that strikes me as being almost category defining

um I don't know your business well enough but it seems to me you're providing something that you don't have a lot of competitors out there but maybe I'm wrong do you have a lot of competition

Gaby Diamant: yes actually it was fun it's a funny question because we were swimming in the extremely blue ocean up until six months ago

um no we did Gen AI when Gen AI wasn't a phrase okay we we called it NLP when when we started the company and we had no competitors nobody did an AI research AI financial research it wasn't even it wasn't even a category by the way and what happened is that we said Okay look at Morningstar I want to take to take control

and I want to take control two bite morning started at he okay and going after them at April a game changer happened which is G PT four the GPT-4 combined with the Jet GPT brought the power to the world that was never seen before yeah and but not it was seen but only on the top levels of the technological technological company

it brought the retail world a power that he has never seen or never imagined is possible and for us that was a game changer because first of all we better our we we better our back because yay we knew something in 2019 everybody told us that we needed to focus on graphs and aggregation and we said no we want to focus on the analysis

we wanted to focus on the rationale but the second part was oh my God what just happened so I'm the tectonic shift happened I'm in the middle of the hardest topic in the world I have the advantage but I have giants right now that are running after me yes and um I think what we did extremely well in that situation and thank you for the pro the phrase category defining this is exactly what we're trying to do

and this was exactly the mindset when we decided to response to the response to the challenge was okay so this happened what are we doing and In less than a month and a half we had a board meeting analyzing the strength weaknesses opportunities and threat and then analyzing our unfair advantages on our case the unfair advantage was regulation the unfair advantage was the complete control and everything that comes out of our language model and the unfair advantage was the laser sharp focus that we are in

and so those three those three layers actually created a laser created an unfair advantage of us and we decided okay so what are we going to change and the first and foremost we said okay we are going to be a category defining company we have two things that we can fail on them fail on the first one is now right now language model is a thing

so we have competitor we have comparisons we need to make sure that our language is flawless so we created a full innovation team that all it does it's taking focus on the language model the world can collapse behind uh around it they will keep on focusing the language model and improving it and make it more and more precise

the second thing was business wise we were planning on going to the U s in the middle of 20 2025 after we gained a lot of traction from around the globe were a language barrier uh our language uh advantage is so is so strong what we understood is to become a category defining company in the finance world you need to be in York

so it took us less than a month after the after the board meeting to hire local manager as I told you Robert and two months after it I moved with the entire family for three months to the US to kick off the to kick off the company and to kick off the local branch which I'm glad to say was one of the best bets we took

uh we signed some really big names I'm guessing that by the time it will appear you can actually say that Nasdaq just signed with us a few weeks ago as a client so really really proud proud of it wow

Mike O'Neill: for those listening you and I first met in September we're recording this in late October and all likelihood this will go live in early January

um Gaby you've given us two examples I don't know if they were back to back or not but the 1st 1 was the decision to basically reinvent how you did business so that you could have significant impact on that close ratio and the ability to adapt I think you called it almost a tectonic ship because everybody was jumping on the

aI bandwagon the bandwagon that you had already been on for some time um and you basically recognize we've got something that's still highly competitive let's seize that and it sounds as if you even accelerated your expansion plans because if you didn't get in you might get left behind um at least in the eyes

of others is as CEO trying to kind of keep the foot on the gas maybe that's an expression familiar with but to kind of keep that going is that something you see as your role to find that right pace of growth without outstripping the company's capabilities

Gaby Diamant: that's that's an amazing question I will tell you what um you know I'm going and I'm fundraising a lot

and today we are we are in a phase that everybody says slow down slow down keep money keep your right runway you need and when we started the company in 2019 everybody said burn burn burn burn burn and I'm always saying exactly the same thing when everybody told us to burn money we can we paced ourselves

we develop a product and we wanted to to achieve product market fit and we didn't expand beyond the rich when but now when you're telling me to slow down no no I am one I I Greg get us and my dress of bridge was is one of the Individual company that can start global we don't need to start with the u

s And then expand little by little we need to to explode immediately and the reason we We need and we want to do it Because a market like Latin America the first that will go to market not only will control it it will actually discourage a lot of other competitor for even begin and we see it happening in Brazil right now

we close like few major major dealers that when someone is coming to check to see if there is new technology they will come to us to check it in Israel it's actually twice as severe we control over 80 percent of the market and when a client wants anything that is related remotely to finance and remotely to AI they are calling us to say listen do you have ESG

and we said no and it happened six months ago and say not yet but I understand exactly what I need to do for when do we need it and they told us they need it for the beginning of the year I said no problem you can count on us come be a design partner of ours and we moved forward and I think this is one of the part that I will tell you me as a CEO my My part my role is actually to fight to to create a rapid growth

but to listen very well and to the smart people around me when they're telling me to stop to slow down it's my it's definitely my role not only to listen to them if I agree with them to push to the same direction basically I'm trying to be sort of a barometer and to not only to agree and follow actually to agree and lead

Mike O'Neill: you know that term barometer is a great term and that is surround yourself with very smart people listen to them and when it is clear this is what we need to do get in front and kind of lead the charge gabi as you kind of reflect on this conversation what do you want to be those takeaways

Gaby Diamant: I think the three takeaways would be adapting when things are good are being bad are bad

but adapting and understanding the risk when things are being very very good looks very very good because ignoring the risk from a very good good scenario is one of the things that will bring to a downfall and the 3rd one is taking taking understanding and understanding the situation to the best of your knowledge

after you do that when you're in a team if you're outspoken not you don't only go and you accept the outspoken the majority you join them and lead to the direction that they paved and I think this is one of the this is one of my key roles and one of the things that I will say it's between 50 percent of the time that I'm arguing with anybody in the team I lose

and this is the thing I enjoy the most

Mike O'Neill: Gaby I really appreciate your willingness to share your insights with us today if folks want to reach out to you what's the best way for them to connect with you

Gaby Diamant: um through LinkedIn or through mail I think it's dais

Mike O'Neill: and lemme for the for folks who might say well how do you spell Gaby's name

um I think you're listed in LinkedIn let me double check how that's set up yes but Gaby Gaby short for Gabriel uh and your last name is Diamant d-I-A-M-A-N-T uh it is on LinkedIn that you and I first um got to know each other uh it led to a conversation that's led to to this podcast recording Gaby thank you so much for sharing with us today

Gaby Diamant: thank you Mike it was a pleasure being here and I'm expecting you to call me again

Mike O'Neill: I would I would like that I also want to thank our listeners for joining us today you know my passion is building leaders leaders that people follow not because they have to but because they want to and therefore if you are a business Leader and you're struggling with issues such as high turnover or poor execution

let's talk head over to bench-builderscom to schedule a call so I want to thank you again for joining us and I hope you have picked up on some quick wins from Gaby that will help you get unstuck and on target