All our best wishes for this new year 2019!

2018 proved to be an eventful year for SESAMm with multiple renowned customers acquired, our A series fundraising campaign, numerous prizes won and milestones reached. Here is a look back at our rewarding year 2018 followed by our next steps for 2019.

Successful market entry in the US and around the world

The rapid growth of the alternative data industry and of SESAMm

As a Fintech company specialized in alternative data for Asset Management, 2018 represented a thrilling year in our industry and 2019 already promises to be even more exciting.

During 2018, after our very first business trip in the United States, our international sales development beyond Europe began accelerating. In just one year, we already signed contracts with multiple clients. These include major hedge funds in the US and a major global trading company managing $100 billion in financial assets and part of the Top 10 in its market. The US market represents a powerful strategic growth driver and we are already preparing to open an office there soon!

SESAMm signed its first contract with a client in Africa: Ipro Investment, renown asset manager established for 25 years specialized in emerging markets. Finally, we also signed a contract with our first Japanese client, Nikko Global Wrap, one of the subsidiaries of Sumitomo Mitsui Asset Management which is a major asset manager in Japan managing JPY 1.7 trillion.

Strengthening and developing our position in Europe

At the European level, SESAMm has also extended its customer portfolio:

• Groupama AM: new major clients and leading French Asset Management players managing €103 billion Asset under Management (AuM);
• Société Générale: leading French bank present all over the world;
• Raiffeisen Bank International: one of the leading banks in Europe with more than 50,000 employees servicing over 16.5 million customers and possessing around 2,400 business outlets;
• GT Patrimoine : the largest consulting and private management firm in the Lorraine area and based in France for 12 years.

In addition, after our 1st successful collaboration, a new contract was signed with Candriam, leading Asset Management firm and members of the New York Life Group, managing more than $112 billion AuM worldwide.

We are very proud to see how much traction we gained in just a year. The growing use and interest in alternative data for the Asset Management industry, both for quantitative and fundamental funds and asset managers, lead us to prepare for new opportunities of growth & business development.

Cutting edge solutions to respond to market needs

Big Data & AI for Cryptocurrencies

Our first cryptocurrency project began in early 2018. Initially, we started tracking the evolution of the most popular cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH) and we analyzed their social data to produce social sentiment & emotions indicators. These indicators have since been integrated into our visualization platform of market sentiment, L’Humeur des Marchés.

This led us to establish a unique partnership based on L’Humeur des Marchés with NapoleonX, a major player as the leading French cryptocurrency manager: the first sentiment and emotion cryptocurrencies analysis destined for the general public. Since then, ETH and BTC sentiment, emotions & opinion value from SESAMm has been available to individual investors and the general public on NapoleonX platform.

The evolution of L’Humeur des Marchés

Our platform L’Humeur des Marchés is an essential tool to guide companies in their investments. During 2018, multiple improvements were added into L’Humeur des Marchés to further enhance its insights & analytics. For example, users have now the possibility to build automated strategies which can generate daily trading signals. Multiple new features were also added such as a strategic backtesting system, daily alerts with 3 years of history and day+1 signal to forecast market movements giving asset managers an edge over competitors.

"L'humeur des marchés" is SESAMm's data visualization platform to analyze market sentiment & emotion for asset management

L’Humeur des Marchés, our data visualization platform

Finally, additional filters have been added to better study & analyze market sentiment: there are now 6 different filters for data sources (sort by sources from web & press, news, blogs, discussions, social trading or all of them) and 9 languages covered (sort by English, French, Spanish, Chinese, Japanese, Portuguese, Italian, German or all of them). These new filters allow for a wider and more accurate coverage of assets, leading to improved tools & insights for investment decision.

Global recognition & awards for SESAMm

To accomplish our worldwide ambitions, we have started being more and more present abroad, especially at international events. They represent great occasions to promote SESAMm, demonstrate the unique benefits and advantages brought by our technologies & solutions and finally create business opportunities.

This year, we participated in many international events in the US and in Japan, including New York and Hong Kong for Eagle Alpha’s Alternative Data event, Canada, Africa and even London at the French Fintech Tour.

Having been selected for unique international awards reinforces our confidence in the benefits of our solutions for the Asset Management industry, for example with “Talk data to me” by Neudata, Elevator Lab Competition, and Groupama’s award “Créateur de confiance” (Trust Creator) among others.

SESAMm won the pitch "Talk data to Me" of Alternative Data Summit event by Neudata

SESAMm pitch “Talk Data to Me” winner during Alternative Data Summit by Neudata

Moreover, SESAMm has competed in several acceleration programs, in which we were selected in the following ones:

• Fintech Business Camp Tokyo, the Tokyo Metropolitan Government accelerator program by Invest Tokyo and powered by Accenture;
• Elevator Lab, Acceleration program of Raiffeisen Bank International where SESAMm competed and was selected;
• French Tech Tour America, IMPACT USA’s program to prepare and discover North America’s markets & opportunities;  
• Pass French Tech, La French Tech’s highly selective program for hyper-growth startups & companies.

SESAMm’s plans for 2019: recruitment, development and growth

This year, we are very proud to see our team grow so much in so little time: we had 16 collaborators at the beginning of January 2018 and we are now a team of 28 members! Talented profiles have joined SESAMm team with NLP, AI & Quant engineers & experts from world-renowned schools. New collaborators will join SESAMm in the first quarter of 2019 and we are still recruiting in various fields such as Data Science, Quantitative Analysis, IT and Natural Language Processing among others. You can find all our offers on our dedicated page SESAMm Career!

Following our international success, especially in the US and in Japan, we are now preparing to open an office in the US in the following months and are already considering this option for Japan. Next month’s promise to be exciting and we will be participating in multiple events such as AI & Data Science for trading in New York in March, Machine Learning in Quant Finance by GFMI in April, and many events & conferences on alternative data, data science, Artificial Intelligence and Big Data for Asset Management around the world.

As you can see, 2018 represented SESAMm an exceptional year for its growth with new customers, including global companies, technological improvements for our solutions & services and a bigger and even more motivated team! Our major event in 2018 was the accomplishment of a €2.6 million Series A fundraising campaign, which enabled us to continue our international development, mainly in America and Asia, and the recruitment of many profiles. 2019 will represent another step for SESAMm to become a leading company in the alternative data solutions in the world. Stay tuned: SESAMm news will arrive soon!

In private equity, as in most industries, decision-making counts on accessing accurate and valuable information. However, these firms often encounter significant challenges when sourcing reliable data, especially when dealing with small, private companies. This article dives into the complexities of identifying high-quality information on smaller companies and underscores its value in investment decisions, operational efficiency, and risk management. It also explores how advanced artificial intelligence (AI) technologies are revolutionizing the identification of these risks, leading to higher rewards and more secure investments, thus providing a competitive edge.

The challenge of identifying valuable information for Smaller Firms

Lack of valuable data

Sturgeon's Law, which states that "Ninety percent of everything is crap (or noise)," becomes particularly relevant in the context of data sourcing. For private equity and investment firms focused on small companies, finding the golden nuggets of information amid the overwhelming amount of digital noise can be daunting. The data available on these companies is often sparse, fragmented, and difficult to uncover using conventional methods. This scarcity of reliable information makes it challenging for private equity firms to make informed decisions, heightening the risk of overlooking critical issues that could impact their investment process.

The difficulties extend beyond just locating information. Many small companies operate without a significant online presence or may not be required to disclose as much information as publicly traded firms. This lack of transparency can further blur critical data points. Furthermore, the data that is available is often unstructured, residing in various forms such as social media posts, obscure local news articles, or industry-specific reports. Extracting meaningful insights from these disparate sources requires sophisticated data processing capabilities, which traditional methods often lack. As a result, private equity firms are left with a significant challenge: how to separate valuable data from the noise without missing critical risk indicators, thereby optimizing their deal sourcing and investment strategies.

Diverse language and terminology

Smaller firms frequently face existential risks, and the potential rewards for identifying these risks early on can be significant for the private equity firms that invest in them. However, mainstream methods of risk identification often fall short, as these companies may not use standardized language to describe materiality. Instead, risks are discussed in varied and context-specific ways, complicating the task of recognizing relevant information. Therefore, it is essential to adopt a specialized approach that analyzes and decodes these firms' unique terminologies and business idiosyncrasies, ultimately translating them into a standardized language that can be effectively used in risk assessment.

The diversity in language is not just a barrier to risk identification but also to the communication of these risks within and between private equity firms. When a small firm uses industry-specific jargon or localized expressions to describe potential threats, it can lead to misunderstandings or underestimations of the actual risk. For instance, a manufacturing startup in a developing country might describe supply chain disruptions in terms that do not translate easily to a global investor’s risk framework. Additionally, cultural differences in how risk is perceived and reported can lead to further complications. This linguistic diversity necessitates the use of advanced natural language processing tools that can interpret data through a common lens while considering industry-specific contexts. For an insurance company, understanding financial models, insurance principles, and regulatory frameworks is crucial. Conversely, assessing risks for a beauty company requires a focus on product safety, consumer preferences, and market trends. By appreciating the specific contexts of each industry, private equity firms can better identify and evaluate potential risks, enhancing decision-making processes, risk and portfolio management strategies, and operational efficiency.

The dynamic nature of the industries themselves further complicates the challenge. For example, the tech industry evolves rapidly, with new risks emerging as technologies develop and consumer expectations shift. What might be considered a negligible risk today could become a significant issue tomorrow as regulatory landscapes, market conditions, and technological advancements alter the playing field. In contrast, industries like agriculture or real estate might have more stable risk profiles but are subject to sudden changes due to environmental factors or policy shifts. This variability across industries means that a one-size-fits-all approach to risk assessment is inadequate. Private equity firms must adopt flexible, industry-specific risk models that can adapt to the unique characteristics and evolving landscapes of the sectors they invest in, thus optimizing their AI capabilities.

The Power of AI in Enhancing Risk Management in Small Firms

AI technologies, particularly natural language processing (NLP) and machine learning algorithms, are important tools for private equity firms aiming to monitor and manage risks in small firms. These technologies can sift through vast amounts of data, extracting the valuable 10% and identifying patterns, trends, and subtle nuances in the language used to describe risks. By detecting these patterns, AI can reveal potential risks that might not be immediately apparent through traditional methods. This proactive approach to risk identification allows firms to address issues before they escalate, providing a more comprehensive and nuanced understanding of the risks facing small firms.

AI's ability to process unstructured data is particularly valuable in this context. Many of the risks that small firms face are discussed informally in places like social media, niche blogs, or local news outlets. Traditional risk management tools might overlook these sources, but AI-powered tools can analyze them in real-time, detecting emerging threats as they develop. Moreover, AI can cross-reference these insights with structured data from financial reports, regulatory filings, and other formal documents to create a holistic risk profile. This multidimensional analysis helps private equity firms not only identify risks but also understand their potential impact, enabling more informed, data-driven decision-making that enhances operational efficiency and competitive edge.

Beyond risk identification, AI also enhances risk mitigation strategies. By continuously monitoring data and learning from new information, AI systems can adapt to changing conditions, offering updated risk assessments that reflect the latest developments. This dynamic approach allows private equity firms to stay ahead of potential issues, making it possible to implement preventative measures rather than reacting to crises after they occur. In this way, AI capabilities contribute significantly to the optimization of risk management processes.

How SESAMm’s Advanced Technology Enhances Risk Assessment

SESAMm’s TextReveal® is at the forefront of this technological revolution, enabling private equity firms to efficiently navigate the vast digital landscape and extract the crucial information needed for informed decision-making. Through our proprietary data lake amounting to over 25 billion online articles with 15 years of historical data and our AI algorithms, TextReveal® can quickly identify and retrieve valuable insights, even when the information is deeply buried or highly specific. The tool's ability to analyze and understand the diverse language and terminology used in discussions about risks on the web empowers private equity firms to objectively assess the materiality of certain risks or identify emerging threats that have yet to be formally recognized.

TextReveal® goes beyond merely identifying risks—it categorizes them, providing context that helps private equity firms understand the severity and relevance of each risk. For example, if a small biotech firm is mentioned in discussions about regulatory hurdles, TextReveal® can determine whether these mentions are isolated incidents or part of a broader trend. It can also assess whether the language used suggests an imminent threat or a longer-term concern, enabling firms to prioritize their responses accordingly. Additionally, TextReveal® integrates sentiment analysis, which can gauge the overall tone of discussions surrounding a company, offering further actionable insights into potential reputational risks.

SESAMm has developed a proprietary metric – the Intensity Score, which calculates an event's relevance based on its news coverage and sentiment. It uses negative sentiment, article dispersion, and empirical ESG risk measures to determine how likely an article is to represent a high-risk controversy. The Intensity Score gives TextReveal users a clear understanding of which events require their attention.

Users can also opt to receive email alerts for the more severe controversies, ensuring they’re always aware of significant risks.
In addition to the severity, controversies are also categorized by risk and sub–risk type, making it easy to analyze specific areas of concern.

Moreover, SESAMm's platform is designed to be intuitive and user-friendly, making it accessible to investment professionals who may not have a technical background. This ease of use ensures private equity firms can quickly incorporate AI-driven insights into their risk management processes without a steep learning curve. By streamlining the data analysis process, TextReveal® allows firms to focus on strategic decision-making, confident they have a comprehensive understanding of the risks and opportunities associated with their investments and portfolio companies. This level of operational efficiency and optimization is key to maintaining a competitive edge in the fast-paced world of private equity.

TextReveal’s Risk Assessment module enables deep company and thematic research in multiple languages through on-the-fly keyword searches. Users have full access to articles, sentiment analysis, and trending topics to get a complete understanding of the risks. We’ve even developed an AI Text Summary feature that provides a quick summary of a selected article, saving time and enabling a faster analysis.

In summary, the integration of AI tools and natural language processing technologies is transforming risk management in private equity, particularly for firms dealing with small, private companies. By leveraging these advanced tools, private equity firms can enhance their due diligence processes, better monitor risks and controversies, and ultimately make more informed investment decisions that lead to higher rewards and operational efficiency.

Reach out to SESAMm

TextReveal's web data analysis of over five million public and private companies is essential for keeping tabs on ESG investment risks. To learn more about how you can analyze web data or request a demo, contact one of our representatives.

With summer here, travelers are turning to vacation rental platforms more than ever to plan their getaways. As these platforms grow, it’s important to understand the ESG controversies they face, impacting users, hosts, and local communities worldwide.

Vacation rental platforms like Airbnb, Booking.com, Expedia, and Tripadvisor have faced several ESG challenges recently, including regulatory issues, safety and privacy concerns, and social controversies related to housing affordability and community displacement.
Different companies face varied risks: Airbnb deals with global restrictions and legal issues, Booking.com faces antitrust fines and tax disputes, Expedia contends with operational challenges, and Tripadvisor grapples with reputational concerns. All, however, must balance growth with ethical practices.

What are the most pressing ESG challenges currently facing the vacation rental sector?
Read to find out.

Booking.com has encountered various ESG risks due to regulatory scrutiny and legal issues. The company faced a €413 million fine in Spain for abusing market dominance with price parity clauses and a €94 million tax settlement in Italy for VAT compliance. Additionally, Russia penalized it for antitrust violations, while hotel operators in Japan filed lawsuits over unpaid fees. Legal scrutiny also surrounds its listings in the occupied West Bank, with investigations by Dutch prosecutors. In the U.S., a court ruled that Booking.com illegally scraped Ryanair’s website. Finally, a significant data breach exposed millions of guests’ sensitive information, raising cybersecurity concerns, and planned workforce reductions highlight ongoing operational risks for stakeholders globally.

Key Controversies:

• Booking.com fined 413 million euros by the Spanish authority CNMC for unfair competition
• ‍Booking.com to pay 94 million euros to settle Italian tax dispute
• Firms in Japan sue Booking.com in Tokyo over unpaid deposits‍
• Booking.com's listing in West Bank examined by Dutch prosecutor‍
• Booking.com aims to lay off 25% of its workforce

Airbnb: Global Crackdowns and Controversies Rise

Airbnb is facing significant regulatory and legal challenges globally, including Spain's order to remove over 65,000 listings, Italy's €576 million tax settlement, and stricter rental rules in Greece and France. In the US, cities like New York have imposed tight short-term rental limits, while Airbnb is dealing with class-action lawsuits in Canada and pricing accusations in Australia. Safety and privacy issues also plague the platform, including lawsuits related to guest deaths. Furthermore, Airbnb has been criticized for its listings on occupied Palestinian land and its impact on housing affordability. In 2023, the company cut 1,900 jobs, or about 25% of its workforce, increasing its ESG risks amidst evolving pressures.

Key Controversies:

• Spain orders removal of over 65,000 Airbnb rentals for regulatory violations
• Italy bans Airbnb self-check-ins
• Airbnb fined 300,000 euros for lack of consumer information
• Short-term rental restrictions hit Airbnb in New York
• Airbnb accused by Australian regulator of misleading pricing

Expedia: Governance Gaps and Growing Legal Risks

Expedia Group faces several ESG risks, though generally less severe than its larger peers. Key challenges include a $33 million penalty in Australia for misleading hotel rates, 1,500 job cuts, antitrust investigations in Europe, and a $29.8 million payment under the Helms-Burton Act. Legal issues also involve unpaid commissions, tax avoidance claims, and COVID-19 flight refund disputes. Governance problems include executive departures and a reverse racism lawsuit, along with data breaches affecting millions. Overall, these risks are significant but less severe than those of competitors.

Key Controversies:

• Australia fines Expedia Group's Trivago $33 mln on misleading hotel room rates
• Expedia is cutting 1,500 jobs
• US court orders Expedia to pay 29.8 million in the Helms-Burton application
• White candidate sues Expedia alleging reverse racism in hiring process
• Expedia faces class action over COVID-19 flight refund refusals

Conclusion

In conclusion, the vacation rentals sector faces significant ESG challenges that threaten its growth and credibility. Major players like Booking.com, Airbnb, and Expedia must address regulatory scrutiny, safety concerns, and social issues to meet the evolving expectations of travelers. By prioritizing transparency, community engagement, and compliance, these platforms can rebuild trust and promote responsible tourism. Embracing these changes not only mitigates risks but also positions them to lead in sustainable travel and reshape the future of vacation rentals.

Reach out to SESAMm

TextReveal’s web data analysis of over five million public and private companies is essential for keeping tabs on ESG investment risks. To learn more about how you can analyze web data or to request a demo, reach out to one of our representatives.