Predictive Analytics firm goes bust claiming that the unpredictability of the market caused their downfall
One of North America’s most promising predictive analytics firms has filed for bankruptcy after a horrific 9 months saw their revenue fall to just $10m, posting an operating loss of over $75m.
Predictive analytics encompasses a wide range of techniques, from data mining to artificial intelligence, that are used to analyse current data to make predictions about unknown future events. It has been remarkably popular with businesses across many industries over the last two decades, however in recent years we’ve started to see signs of a slow down and now we may be witnessing the start of a big correction.
The unnamed analytics firm, who’s flagship product was a predictive analytics tool used by intelligence agencies and banks, said that unforeseeable market shocks such as Britain rejoining the EU, Trump’s impeachment and the price of a bitcoin reaching $5k, had caused it to fold.
Leaders from the data analytics community have been quick to come out in defence of their fallen comrade saying that it was almost impossible to predict the market events of the last year and that “everyone was suffering”.
Whilst it is never nice to see hardworking employees lose their jobs the irony of the mater can hardly be ignored. A firm that specialised in giving companies the edge through analysing market data now no longer exists because of its inability to foresee certain market events.
It brings into question how useful the tools are that these firms peddle and whether they indeed practice what they preach. Once again we see the dangers of pinning everything on technology. How many more predictive analytics firms will we see gobbled up by unpredictability? Or perhaps acquired by a Big 4 Professional Services firm? How many people working in the broader data analytics industry have read NNT’s The Black Swan? Is anyone making a predictive analytics tool for predictive analytics firms?
Stay safe out there.