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MVP versus EVP: Is it time to introduce ethics into the agile startup model?

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MVP versus EVP: Is it time to introduce ethics into the agile startup model?

The rocket ship trajectory of a startup is well known: Get an idea, build a team and slap together a minimum viable product (MVP) that you can get in front of users.

However, today’s startups need to reconsider the MVP model as artificial intelligence (AI) and machine learning (ML) become ubiquitous in tech products and the market grows increasingly conscious of the ethical implications of AI augmenting or replacing humans in the decision-making process.

An MVP allows you to collect critical feedback from your target market that then informs the minimum development required to launch a product — creating a powerful feedback loop that drives today’s customer-led business. This lean, agile model has been extremely successful over the past two decades — launching thousands of successful startups, some of which have grown into billion-dollar companies.

However, building high-performing products and solutions that work for the majority isn’t enough anymore. From facial recognition technology that has a bias against people of color to credit-lending algorithms that discriminate against women, the past several years have seen multiple AI- or ML-powered products killed off because of ethical dilemmas that crop up downstream after millions of dollars have been funneled into their development and marketing. In a world where you have one chance to bring an idea to market, this risk can be fatal, even for well-established companies.

Startups do not have to scrap the lean business model in favor of a more risk-averse alternative. There is a middle ground that can introduce ethics into the startup mentality without sacrificing the agility of the lean model, and it starts with the initial goal of a startup — getting an early-stage proof of concept in front of potential customers.

However, instead of developing an MVP, companies should develop and roll out an ethically viable product (EVP) based on responsible artificial intelligence (RAI), an approach that considers the ethical, moral, legal, cultural, sustainable and social-economic considerations during the development, deployment and use of AI/ML systems.

And while this is a good practice for startups, it’s also a good standard practice for big technology companies building AI/ML products.

Here are three steps that startups — especially the ones that incorporate significant AI/ML techniques in their products — can use to develop an EVP.

Find an ethics officer to lead the charge

Startups have chief strategy officers, chief investment officers — even chief fun officers. A chief ethics officer is just as important, if not more so. This person can work across different stakeholders to make sure the startup is developing a product that fits within the moral standards set by the company, the market and the public.

They should act as a liaison between the founders, the C-suite, investors and the board of directors with the development team — making sure everyone is asking the right ethical questions in a thoughtful, risk-averse manner.

Machines are trained based on historical data. If systemic bias exists in a current business process (such as unequal racial or gender lending practices), AI will pick up on that and think that’s how it should continue to behave. If your product is later found to not meet the ethical standards of the market, you can’t simply delete the data and find new data.

These algorithms have already been trained. You can’t erase that influence any more than a 40-year-old man can undo the influence his parents or older siblings had on his upbringing. For better or for worse, you are stuck with the results. Chief ethics officers need to sniff out that inherent bias throughout the organization before it gets ingrained in AI-powered products.

Integrate ethics into the entire development process

Responsible AI is not just a point in time. It is an end-to-end governance framework focused on the risks and controls of an organization’s AI journey. This means that ethics should be integrated throughout the development process — starting with strategy and planning through development, deployment and operations.

During scoping, the development team should work with the chief ethics officer to be aware of general ethical AI principles that represent behavioral principles that are valid in many cultural and geographic applications. These principles prescribe, suggest or inspire how AI solutions should behave when faced with moral decisions or dilemmas in a specific field of usage.

Above all, a risk and harm assessment should be conducted, identifying any risk to anyone’s physical, emotional or financial well-being. The assessment should look at sustainability as well and evaluate what harm the AI solution might do to the environment.

During the development phase, the team should be constantly asking how their use of AI is in alignment with the company’s values, whether models are treating different people fairly and whether they are respecting people’s right to privacy. They should also consider if their AI technology is safe, secure and robust and how effective the operating model is at ensuring accountability and quality.

A critical component of any machine learning model is the data that is used to train the model. Startups should be concerned not only about the MVP and how the model is proved initially, but also the eventual context and geographic reach of the model. This will allow the team to select the right representative dataset to avoid any future data bias issues.

Don’t forget about ongoing AI governance and regulatory compliance

Given the implications on society, it’s just a matter of time before the European Union, the United States or some other legislative body passes consumer protection laws governing the use of AI/ML. Once a law is passed, those protections are likely to spread to other regions and markets around the world.

It’s happened before: The passage of the General Data Protection Regulation (GDPR) in the EU led to a wave of other consumer protections around the world that require companies to prove consent for collecting personal information. Now, people across the political and business spectrum are calling for ethical guidelines around AI. Again, the EU is leading the way after releasing a 2021 proposal for an AI legal framework.

Startups deploying products or services powered by AI/ML should be prepared to demonstrate ongoing governance and regulatory compliance — being careful to build these processes now before the regulations are imposed on them later. Performing a quick scan of the proposed legislation, guidance documents and other relevant guidelines before building the product is a necessary step of EVP.

In addition, revisiting the regulatory/policy landscape prior to launch is advisable. Having someone who is embedded within the active deliberations currently happening globally on your board of directors or advisory board would also help understand what is likely to happen. Regulations are coming, and it’s good to be prepared.

There’s no doubt that AI/ML will present an enormous benefit to humankind. The ability to automate manual tasks, streamline business processes and improve customer experiences are too great to dismiss. But startups need to be aware of the impacts AI/ML will have on their customers, the market and society at large.

Startups typically have one shot at success, and it would be a shame if an otherwise high-performing product is killed because some ethical concerns weren’t uncovered until after it hits the market. Startups need to integrate ethics into the development process from the very beginning, develop an EVP based on RAI and continue to ensure AI governance post-launch.

AI is the future of business, but we can’t lose sight of the need for compassion and the human element in innovation.

Source: Tech

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Paack pulls in a $225M Series D led by SoftBank to scale its E-commerce delivery platform

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By now, many of us are familiar with the warehouse robots which populate those vast spaces occupied by the likes of Amazon and others. In particular, Amazon was very much a pioneer of the technology. But it’s 2021 now, and allying warehouse robots with a software logistics platform is no longer the monopoly of one company.

One late-stage startup which has been ‘making hay’ with the whole idea is Paack, an e-commerce delivery platform which a sophisticated software platform that integrates with the robotics which are essential to modern-day logistics operations.

It’s now raised €200m ($225m) in a Series D funding round led by SoftBank Vision Fund 2. The capital will be used for product development and European expansion.

New participants for this round also include Infravia Capital Partners, First Bridge Ventures, and Endeavor Catalyst. Returning investors include Unbound, Kibo Ventures, Big Sur Ventures, RPS Ventures, Fuse Partners, Rider Global, Castel Capital, and Iñaki Berenguer.

This funding round comes after the creation of a profitable position in its home market of Spain, but Paack claims it’s on track to achieve similar across its European operations, Such as in the UK, France, and Portugal.

Founded by Fernando Benito, Xavier Rosales and Suraj Shirvankar, Paack now says it’s delivering several million orders per month from 150 international clients, processing 10,000 parcels per hour, per site. Some 17 of them are amongst the largest e-commerce retailers in Spain.

The startup’s systems integrate with e-commerce sites. This means consumers are able to customize their delivery schedule at checkout, says the company.

Benito, CEO and Co-founder, said: “Demand for convenient, timely, and more sustainable methods of delivery is going to explode over the next few years and Paack is providing the solution. We use technology to provide consumers with control and choice over their deliveries, and reduce the carbon footprint of our distribution.” 

Max Ohrstrand, Investment Director at SoftBank Investment Advisers said: “As the e-commerce sector continues to flourish and same-day delivery is increasingly the norm for consumers, we believe Paack is well-positioned to become the category leader both in terms of its technology and commitment to sustainability.”

According to research from the World Economic Forum (WEF), the last-mile delivery business is expected to grow 78% by 2030, causing a rise in CO2 emissions of nearly one-third.

As a result, Paack claim it aims to deliver all parcels at carbon net-zero by measuring its environmental impact, using electric last-mile delivery vehicles. It is now seeking certification with The Carbon Trust and United Nations.

In an interview Benito told me: “We have a very clear short term vision which is to lead sustainable e-commerce delivers in Europe… through technology via what we think is perhaps the most advanced tech delivery platform for last-mile delivery. Our CTO was the CTO and co-founder of Google Cloud, for instance.”

“We are developing everything from warehouse automation, time windows, routing integrations etc. in order to achieve the best delivery experience.”

Paack says it is able to work with more than one robotics partner, but presently it is using robots from Chinese firm GEEK.

The company hopes it can compete with the likes of DHL, Instabox, and La Poste in Europe, which are large incumbents.

Source: Tech

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Infermedica raises $30M to expand its AI-based medical guidance platform

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Infermedica, a Poland-founded digital health company that offers AI-powered solutions for symptom analysis and patient triage, has raised $30 million in Series B funding. The round was led by One Peak and included participation from previous investors Karma Ventures, European Bank for Reconstruction and Development, Heal Capital and Inovo Venture Partners. The new capital means the startup has raised $45 million in total to date.

Founded in 2012, Infermedica aims to make it easier for doctors to pre-diagnose, triage and direct their patients to appropriate medical services. The company’s mission is to make primary care more accessible and affordable by introducing automation into healthcare. Infermedica has created a B2B platform for health systems, payers and providers that automates patient triage, the intake process and follow-up after a visit. Since its launch, Infermedica is being used in more than 30 countries in 19 languages and has completed more than 10 million health checks.

The company offers a preliminary diagnosis symptom checker, an AI-driven software that supports call operators making timely triage recommendations and an application programming interface that allows users to build customized diagnostic solutions from scratch. Like a plethora of competitors, such as Ada Health and Babylon, Infermedica combines the expertise of physicians with its own algorithms to offer symptom triage and patient advice.

In terms of the new funding, Infermedica CEO Piotr Orzechowski told TechCrunch in an email that the investment will be used to further develop the company’s Medical Guidance Platform and add new modules to cover the full primary care journey. Last year, Infermedica’s team grew by 80% to 180 specialists, including physicians, data scientists and engineers. Orzechowski says Infermedica has an ambitious plan to nearly double its team in the next 12 months.

Image Credits: Infermedica

“We will invest heavily into our people and our products, rolling out new modules of our platform as well as expanding our underlying AI capabilities in terms of disease coverage and accuracy,” Orzechowski said. “From the commercial perspective, our goal is to strengthen our position in the US and DACH and we will focus the majority of our sales and marketing efforts there.”

Regarding the future, Orzechowski said he’s a firm believer that there will be fully automated self-care bots in 5-10 years that will be available 24/7 to help providers find solutions to low acuity health concerns, such as a cold or UTI.

“According to WHO, by 2030 we might see a shortage of almost 10 million doctors, nurses and midwives globally,” Orzechowski said. “Having certain constraints on how fast we can train healthcare professionals, our long-term plan assumes that AI will become a core element of every modern healthcare system by navigating patients and automating mundane tasks, saving the precious time of clinical staff and supporting them with clinically accurate technology.”

Infermedica’s Series B round follows its $10 million Series A investment announced in August 2020. The round was led by the European Bank for Reconstruction and Development (EBRD) and digital health fund Heal Capital. Existing investors Karma Ventures, Inovo Venture Partners and Dreamit Ventures also participated in the round.

Source: Tech

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KKR invests $45M into GrowSari, a B2B platform for Filipino MSMEs

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A sari-sari store owner who uses GrowSari

GrowSari, the Manila-based startup that helps small shops grow and digitize, announced today that KKR will lead its Series C round with a $45 million investment. The funds will be used to enter new regions in the Philippines and expand its financial products. The Series C round is still ongoing and the startup says it is already oversubscribed, with the final composition currently being finalized. 

Before its Series C, GrowSari’s total raised was $30 million. TechCrunch last wrote about GrowSari in June 2021, when it announced its Series B. Since then, it has expanded the number of municipalities it serves from 100 to 220, and now has a customer base of 100,000 micro, small and mid-sized enterprise (MSME) store owners. 

Founded in 2016, GrowSari is a B2B platform that offers almost every kind of service that small- to medium-sized retailers, including neighborhood stores that carry daily necessities (called sari-saris), roadside and market shops and pharmacies, need.

For example, it has a wholesale marketplace with products from major fast-moving consumer goods (FMCG) brands like Unilever, P&G and Nestle. It partners with over 200 providers, like telecoms, fintechs and subscription plans, so sari-saris can offer services like top-ups and bill payments to their customers. 

Sari-sari operators can also use GrowSari to launch e-commerce stores and access short-term working capital loans to buy inventory. The startup’s other financial products include digital wallets and cash-in services, and it is looking at adding remittance, insurance and loans in partnership with other providers. 

The new funding will be used to expand into the Visayas and Mindanao, the two other main geographical regions in the Philippines, with the goal of covering all 1.1 million “mom and pop” stores in the Philippines. 

Source: Tech

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