Private-equity firms often employ herds of junior employees to comb through and cold-call companies to source deals. But technology-focused Pilot Growth Equity Partners has found that a system using artificial intelligence can do the job just as well.
The San Francisco firm, which just closed its second fund, developed NavPod, a cloud-based deal sourcing and workflow tool that it has used to source eight of its 10 completed deals over the past four years.
“We built NavPod because it was a necessity,” said William Lee, a co-founder and managing director at the firm. “We are the ones who have to do the cold-calling.”
Mr. Lee said that the firm, which has managed over $200 million of assets with four employees and four advisers, began to build NavPod in 2013. It took two years to write the AI programming code and come up with the first version of the software in 2015, he said.