‘It’s not as good as McKinsey, but it’s instant’

• Silicon Valley is betting on AI startups that compete — and collaborate — with consulting firms.

• These companies are helping to automate market research, data analysis, and operations.

• Companies like Parable, Prologue, and Profound have all raised funding in the past few months.

For decades, the consulting and tech industries have moved in tandem: Silicon Valley develops new technology, and the big consulting firms help companies deploy it.

But the latest breakthroughs in AI are upending that relationship.

As companies like OpenAI and Anthropic churn out AI models, a cottage industry of “consultancy tech” startups is emerging. Some are leveraging AI to help consultants work more efficiently, and some are hoping to eat their lunch.

Multiple investors told Business Insider that interest in such companies has picked up in Silicon Valley over the past year.

Thomson Nguyen, cofounder and managing partner of venture capital firm Saga, said it’s unlikely that these AI consultancy startups will ever take on the established players. “If you’re a Fortune 500 company building AI infrastructure for your call center, you’ll still hire the Big Four — and you’ll have the budget for it,” he said.

The more likely scenario is that these startups will cater to mid-market businesses — making under $100 million a year — that are too small to hire a McKinsey or Bain, he said.

PromptQL, an enterprise platform launched by open-source unicorn Hasura, aims to automate some of the work of a typical consultant. It helps clients build custom AI analysts by integrating their internal data with the foundation models they already use. Once deployed, these AI analysts can perform tasks typically handled by data scientists or engineers — and continuously learn and adapt to their environments over time.

PromptQL also offers access to its team of expert engineers, who help companies operate their AI analysts and shape broader AI transformation strategies — at a rate of $900 an hour.

“It’s not as good as a McKinsey consultant, but it’s instant,” Tanmai Gopal, PromptQL’s cofounder and CEO, told Business Insider.

He later told Business Insider that the platform’s “killer feature” has been its capacity to provide “AI accuracy at scale without requiring messy data to be prepped or moved elsewhere.”

Gopal said he’s noticed that the consulting tech space has grown substantially in just the past few months.

“This year is when we’re starting to see more and more specialized AI; AI that can learn; AI that can absorb the context of your business,” he said. That means there are now significant opportunities for AI analysts, he said. “It’s definitely emerging, because that is where the most valuable problems are.”

Tomasz Tunguz, a general partner at Theory Ventures, an investment firm, told Business Insider that he’s seen a spate of consulting-focused AI startups emerge in the past nine months. He said he’s met with several of them, but hasn’t invested yet.

Still, he said he’s noticed five patterns. There are AI startups that support call centers and automate customer service, tech consulting startups focused on AI and software implementation, startups developing accounts payable and receivable automation tools, management consulting startups building strategic and operational AI systems, and, finally, he said, there is a growing segment of startups in executive coaching.

A number of these companies have landed funding in the past couple of months.

Parable, an AI-powered intelligence platform that helps companies track how their employees spend their time, announced a $16.6 million funding round in September. Profound, an answer engine optimization platform, announced a $20 million raise in August. Dialogue AI, which automates market research, announced a $6 million raise on Friday.

Xavier AI, which bills itself as the world’s first AI strategy consultant, is raising a seed round expected to close in the coming weeks, cofounder Joao Filipe told Business Insider.

“I would say the whole AI environment is competitive, but the opportunity is massive — it is more about finding the kind of investors with the right fit and background that understands this problem (not just AI-focused but also with industry expertise),” he wrote.

Founders building in this space say their aim is to democratize access to consulting services — not replace human work.

“There’s still a kind of consulting that a McKinsey consultant does,” Gopal said. “It’s not so much about the company data, but it’s about other things. It’s about a network.”

Read the original article on Business Insider

• Silicon Valley is betting on AI startups that compete — and collaborate — with consulting firms.

• These companies are helping to automate market research, data analysis, and operations.

• Companies like Parable, Prologue, and Profound have all raised funding in the past few months.

For decades, the consulting and tech industries have moved in tandem: Silicon Valley develops new technology, and the big consulting firms help companies deploy it.

But the latest breakthroughs in AI are upending that relationship.

As companies like OpenAI and Anthropic churn out AI models, a cottage industry of “consultancy tech” startups is emerging. Some are leveraging AI to help consultants work more efficiently, and some are hoping to eat their lunch.

Multiple investors told Business Insider that interest in such companies has picked up in Silicon Valley over the past year.

Thomson Nguyen, cofounder and managing partner of venture capital firm Saga, said it’s unlikely that these AI consultancy startups will ever take on the established players. “If you’re a Fortune 500 company building AI infrastructure for your call center, you’ll still hire the Big Four — and you’ll have the budget for it,” he said.

The more likely scenario is that these startups will cater to mid-market businesses — making under $100 million a year — that are too small to hire a McKinsey or Bain, he said.

PromptQL, an enterprise platform launched by open-source unicorn Hasura, aims to automate some of the work of a typical consultant. It helps clients build custom AI analysts by integrating their internal data with the foundation models they already use. Once deployed, these AI analysts can perform tasks typically handled by data scientists or engineers — and continuously learn and adapt to their environments over time.

PromptQL also offers access to its team of expert engineers, who help companies operate their AI analysts and shape broader AI transformation strategies — at a rate of $900 an hour.

“It’s not as good as a McKinsey consultant, but it’s instant,” Tanmai Gopal, PromptQL’s cofounder and CEO, told Business Insider.

He later told Business Insider that the platform’s “killer feature” has been its capacity to provide “AI accuracy at scale without requiring messy data to be prepped or moved elsewhere.”

Gopal said he’s noticed that the consulting tech space has grown substantially in just the past few months.

“This year is when we’re starting to see more and more specialized AI; AI that can learn; AI that can absorb the context of your business,” he said. That means there are now significant opportunities for AI analysts, he said. “It’s definitely emerging, because that is where the most valuable problems are.”

Tomasz Tunguz, a general partner at Theory Ventures, an investment firm, told Business Insider that he’s seen a spate of consulting-focused AI startups emerge in the past nine months. He said he’s met with several of them, but hasn’t invested yet.

Still, he said he’s noticed five patterns. There are AI startups that support call centers and automate customer service, tech consulting startups focused on AI and software implementation, startups developing accounts payable and receivable automation tools, management consulting startups building strategic and operational AI systems, and, finally, he said, there is a growing segment of startups in executive coaching.

A number of these companies have landed funding in the past couple of months.

Parable, an AI-powered intelligence platform that helps companies track how their employees spend their time, announced a $16.6 million funding round in September. Profound, an answer engine optimization platform, announced a $20 million raise in August. Dialogue AI, which automates market research, announced a $6 million raise on Friday.

Xavier AI, which bills itself as the world’s first AI strategy consultant, is raising a seed round expected to close in the coming weeks, cofounder Joao Filipe told Business Insider.

“I would say the whole AI environment is competitive, but the opportunity is massive — it is more about finding the kind of investors with the right fit and background that understands this problem (not just AI-focused but also with industry expertise),” he wrote.

Founders building in this space say their aim is to democratize access to consulting services — not replace human work.

“There’s still a kind of consulting that a McKinsey consultant does,” Gopal said. “It’s not so much about the company data, but it’s about other things. It’s about a network.”

Read the original article on Business Insider