In a typical organization, finance is one of the most important functions. However, teams are often bogged down by manual workflows. According to a survey by Paylocity, an HR software provider, 38% of finance teams spend more than a quarter of their time on manual work, such as reviewing invoices.
Matthieu Hafemeister, a former fintech investor at Andreessen Horowitz, says he has seen many financial organizations struggle to grow as a result of all the work they are doing at hand.
“The established order of finance is countless point solutions that are improvised within the finance department,” Hafemeister told TechCrunch. “Excel remains the lowest common denominator, limiting the promise of automation.”
As Hafemeister points out, most finance departments rely heavily on spreadsheets. One survey found that 82% still use Excel files for budgeting, forecasting, and other basic financial planning activities.
After experiencing these frustrations firsthand while leading the growth of fintech company Jeeves, Hafemeister decided to partner with Ted Michaels, Jeeves' former CFO and an old friend, to launch a platform to automate financial tasks.
Called Quiz, the platform connects to a company's financial systems to allow finance teams to retrieve and analyze data, generate charts, and ask ad hoc questions like “What is our non-GAAP revenue?”
“Concourse can proactively surface insights that enable finance teams to be better prepared by allowing them to stay ahead of trends,” Hafemeister said. “Rather than a tool that attempts to improve the speed or efficiency of completing a task, Concourse can be assigned discrete tasks to perform on its own.”
Now, financial automation is not exactly a new technology. Linq recently came out of stealth with AI to automate aspects of research for financial analysts. Ledge and Doopla are also creating a range of generative modeling tools specific to finance.
But what makes Concourse different, according to Hafemeister, is its ability to execute financial workflows with “complex, multi-step operations.” For example, the platform can retrieve data from a company's NetSuite dashboard to download CSV files and then copy that data into an Excel spreadsheet.
“We leverage large language models to do what works best for them and combine them with more traditional methods of data analysis,” Hafemeister explained.
There is great interest in AI for finance. One survey found that 58% of finance teams now use some form of AI technology, up 21% from 2023. Grand View Analysis estimates that the “AI in fintech” segment, valued at $9.45 billion three years ago, it is growing 16.5% annually.
But to have a chance of making a dent in the financial automation technology market, Concourse will have to demonstrate the return on investment (ROI) of its product, a challenging feat. According to Gartner, showing or estimating the value of AI is one of the main barriers to adopting it in almost half of companies.
Concourse will also have to calm potential customers' fears about the errors and hallucinations introduced by AI. In a survey of UK-based executives according to HR specialist Peninsula, 40% said inaccuracies in AI tools were a key concern, followed by concerns about data confidentiality.
Hafemeister said Concourse employs “a variety of tools and techniques” for fact-checking and validation to try to ensure its AI performs tasks as intended. He added that Concourse does not use companies' data to train its AI models (at least not without explicit permission) and that the platform only collects data that customers share with it.
“Data accuracy is paramount in finance, where answers are often either completely right or completely wrong,” Hafemeister said. “As such, we at Concourse have spent a lot of time and effort delivering an AI that can accurately perform the task given to it. “We also take data privacy and security very seriously and have built Concourse using industry best practices.”
People seem willing to take Hafemeister at his word.
Concourse, which is still in beta ahead of a broader launch planned for next year, has several clients, including Instabase and Shef, and $4.7 million in capital. Hafemeister's former employer, a16z, has invested in the startup, along with Y Combinator, CRV and Field Group.
Hafemeister says the focus right now is on product development and growing Concourse's six-person staff, based in New York.
“We raised money to hire more engineers, develop more workflows that our AI can take on, increase coverage of data integrations, and start scaling our go-to-market function,” he said. “The main focus in hiring engineers is to hire backend, machine learning and artificial intelligence engineers.”