ValidMind confirmed to QA Financial it has raised $8.1 million in fresh funds which the artificial intelligence model risk management startup will use to speed up its go-to-market plans.
Led by Point72 Ventures, capital allocations came from Notion Capital, Angel Invest, Gaingels, FJ Labs, AI Fund, Third Prime Ventures as well as New York Life Ventures.
The funds will be used to expand and roll out its AI model risk management platform, aimed at the financial services space to automate and simplify AI model testing and model risk governance.
“By automating these tasks, we are able to increase developer’s productivity, reduce the time to market for new AI models and improve outcomes for model risk management teams,” explained ValidMind co-founder and Chief Executive Jonas Jacobi.
He stressed that current model risk management processes are “notoriously inefficient.”
“Organisational silos between developers and model validators result in slow and inefficient communications and information sharing.”
– Jonas Jacobi
Jacobi pointed out that the bulk of AI model documentation tasks are currently done manually, which usually results in over 100 hours of manual writing, per model.
Moreover, the validation of models is seen as a reactive procedure that is mostly carried out at the end of any development stage, which means flaws and issues are often missed and only identified months later.
“Organisational silos between developers and model validators result in slow and inefficient communications and information sharing that further hampers progress and extends time to market,” he continued.
As banks and other financial services firm roll out AI applications and features at unprecedented speed, many still use outdated and time-consuming risk management procedures and systems.
“Therefore, this funding strengthens our commitment to helping customers increase the speed and efficiency of their model risk management processes, reduce time-to-market and ensure compliance with global AI and model risk regulations,” Jacobi said.
‘Transform finserv’
Investor Point72 Ventures believes ValidMind is penetrating a lucrative part of the booming AI tech market.
In fact, Managing Partner Tripp Shriner is convinced AI has the potential to transform financial services.
“We believe ValidMind is in a strong position to ensure these models comply with current and future regulations,” he concluded.
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