SESAMm is pleased to announce that Nathalie Wallace is joining our Advisory Board. Nathalie brings more than 20 years of experience at the intersection of investment management, sustainability strategy, and executive leadership. She has built a career helping global investment organizations integrate sustainability into investment decision-making and capital allocation.

Commenting on the appointment, Sylvain Forté, CEO of SESAMm, said, “Nathalie brings a rare combination of investment experience, strategic vision, and deep understanding of how sustainability considerations translate into real-world investment decisions. Her perspective will be invaluable as SESAMm continues to support financial institutions navigating increasingly complex risk and regulatory environments.”

She previously served as Chief Sustainability Officer at Edmond de Rothschild, where she contributed to the firm’s sustainability strategy across asset classes. Prior to that, Nathalie was Global Head of Sustainable Investment at Natixis Investment Managers, where she was a member of the executive, investment, and seed committees, chaired the CSR–Sustainable Investment committee, and served on the boards of Mirova and Ostrum Asset Management. Earlier in her career, she was Global Head of Strategy and Business Development at Mirova, supporting its growth and positioning as a leading sustainable investment platform.

As Senior Advisor to SESAMm, Nathalie will support the company’s strategic direction, bringing her perspective on sustainable finance, investor expectations, and the evolving role of data and AI in risk analysis and investment processes.

“SESAMm’s approach to risk and sustainability intelligence reflects how investment teams are evolving their processes,” said Nathalie Wallace. “I’m excited to contribute my perspective as the firm continues to support investors with timely, decision-relevant insights.”

We are delighted to welcome Nathalie to SESAMm and look forward to working together as we continue to support financial institutions with forward-looking risk and sustainability insights.

SESAMm’s AI Technology Reveals ESG Insights

Discover unparalleled insights into ESG controversies, risks, and opportunities across industries. Learn more about how SESAMm can help you analyze millions of private and public companies using AI-powered text analysis tools.

Tokio Marine & Nichido Fire Insurance Co., Ltd. (TMNF) tapped SESAMm for a joint research venture to predict future stock price movements and discovered two key findings:

1. NLP data from news and social networking websites can have strong relationships with investor behavior. Thus, it’s possible to forecast investors’ rational reactions to changes in data and price movements based on those relationships.
   
   
2. NLP data proved to help anticipate tail events. For example, given the macroeconomic environment of the last 10 years, the stock market performed well. So in this context, investors are sensitive to negative narratives in times of uncertainty, such as the 2015 market sell-off, the U.S.-China trade war, the coronavirus pandemic, and the start of the Ukraine-Russian war, and post their concerns online.

Providing safety and security since 1879

Tokio Marine Insurance Company was first established in 1879. Over the years, it has added products and services, acquired other businesses, and merged with other companies to eventually become Tokio Marine & Nichido Fire Insurance Co., Ltd. Commonly called Tokio Marine Nichido today, the company is a property and casualty insurance subsidiary of Tokio Marine Holdings, the largest non-mutual private insurance group in Japan. Its products and services provide safety and security to its clients and partners, contributing to more fulfilling lifestyles and business development.

One of the company’s philosophies is to be a good corporate citizen and fulfill its social responsibilities, including protecting the global environment, promoting human rights, creating a responsible working environment, and contributing to society and individual local communities. Recently, the Emperor of Japan awarded Tokio Marine Holdings, Inc. the Medal with Dark Blue Ribbon for donating to the Japan Student Services Organization to support students who face financial difficulty during the COVID-19 pandemic. Individuals, corporations, or organizations are awarded the Medal with Dark Blue Ribbon for their outstanding contributions to the public.

Transforming and accepting the challenge to grow

According to TMNF, “The business environment surrounding the insurance industry is changing at a faster pace than ever due to changes in demographics, advances in technologies, such as autonomous driving and AI, and longer-term trends, such as the intensification and frequent occurrence of natural disasters, as well as further progress in digitalization due to the COVID-19 pandemic.”

“The business environment surrounding the insurance industry is changing at a faster pace than ever…”

“While these changes in the business environment pose a threat, we consider them to be excellent opportunities for transformation and the creation of new value.” So they’ve adopted the concept, “Transformation (“X”) and Challenge to Growth 2023: Aiming to be the company most chosen for quality and its passion.” Ultimately, it strives to support customers and local communities in times of need while contributing to social responsibility. Five social issues that it will prioritize are:

• Global climate change and the increase in natural disasters
• The increased burden of long-term care and healthcare due to the aging of society and advances in medical technology
• Technological innovation and its effects on the environment
• Symbiotic society and responding to the novel coronavirus
• Industrial infrastructure and how it supports economic growth and innovation

Leveraging a partner with the right technology

To secure and protect its clients’ assets while elevating social issues, Tokio Marine Nichido sought out an edge in the stock market. Under these circumstances, it was fortunate that TMNF discovered SESAMm in 2020 through the Plug and Play Japan program, a platform with an event that connects Japan to markets abroad. SESAMm had presented its NLP alternative data solution, TextReveal®, to which TMNF considered the platform for access to alternative data and sought collaboration with the SESAMm team for a research project.

“SESAMm has the technology to extract text sentiment from news data with a neural network.”
– Tokio Marine & Nichido Fire Insurance Co. Ltd representative

Extract relations between NLP data and the financial market

In 2021, Tokio Marine Nichido Insurance began collaborating with SESAMm to develop an AI analytics model for alternative data. It models the impact of news and social networking data on investor behavior for stock and bond markets, transforming text information into knowledge usable by TMNF. For instance, when the model detects a negative narrative raising uncertainty in the market, investors can use this signal to reduce their risk exposure.

Predicting future stock price movements from news and social media data

Tokio Marine Nichido and SESAMm’s joint research found that natural language data from news and social networking sites effectively predict future stock price movements. In the case involving the pandemic, for example, there was a time lag of as long as a month between the time COVID-19 became news and the time it affected the U.S. stock market (Figure 1). By using SESAMm’s technology to analyze news data during this period, the team found that US news and social networking sentiment had already deteriorated sharply before stock prices reacted. This sentiment deterioration is due to the fear of the coronavirus-spread effect on the global economy. In an all-time high S&P 500, U.S. investors did not initially consider this risk. In comparison, HSI companies were closer to the coronavirus spread risk, resulting in HSI investors reacting ahead of those in the U.S.

The model can calculate sentiment for each company by analyzing the news of individual companies. It’s also possible to create a composite to measure the sentiment related to a stock index. The sentiment data also helps management and investor relations because it provides a quantitative means of understanding the extent to which investors are concerned about certain news about their company.

Verifying the results

Verification using Japanese has revealed that the timing of bottoming and ceiling of text sentiment precedes those of stock prices. The collaborating team compared the performance of:

• A model that uses only orthodox financial and economic data as inputs
• A model that considers NLP and financial and economic data, confirming that the latter could generate higher alpha

Since measuring sentiment is mean reversionary by nature, the TMNF team believes it provides good support for position management during rallies and crashes. It’s also valuable for avoiding forced loss-cut at the bottom when liquidity temporarily evaporates and the market crashes.

Expanding the research to other use cases

In addition to analyzing the stock market, Tokio Marine Nichido also expanded the scope of the research to include R&D on using natural language data in trading U.S. high-yield bonds. Research shows that NLP data can help provide a hedging signal for the negatively skewed high-yield market (Figure 3) by capturing deteriorating text sentiment (Figure 5). For example, these signals can inform investors to reduce positions before market reactions.

TMNF is also applying the research to estimate the Fed’s stance—hawkish or dovish—using natural language data, too. It hypothesizes that the market will be focused on the Fed’s stance on interest rate hikes in the next few years.

“The model developed in collaboration with SESAMm is simple in structure, yet, it’s an orthodox and robust model that uses valid data as input.”

Summarizing the collaboration

In developing models, Tokio Marine Nichido believes it is essential to consider “what data to consider” and to keep it simple. And TMNF achieved these tenets. The model developed in collaboration with SESAMm is simple in structure, yet, it’s an orthodox and robust model that uses valid data as input which is preferable to a risky over-fitting by increasing complexity.

Get in touch with SESAMm

To learn more about Tokio Marine Nichido’s case study or to request a TextReveal demo, reach out to us here:

Sésame, ouvre-toi, or in English, open sesame, is the famous magical phrase that inspired us to name SESAMm 8 years ago today. And true to its name, since its inception, SESAMm has been opening doors to a new world of advanced analytics powered by natural language processing.

TRIVIA QUESTION: Why the unusual spelling of SESAMm? (Read until the end for the answer.)

Our heritage

Unlike the phrase’s magical nature in the “Ali Baba and the Forty Thieves” story, SESAMm relies on technology to open doors and uncover hidden treasures. And that has been our goal since we started the company in April 2014. Pierre Rinaldi, Florian Aubry, and I saw the vast amount of textual information available on the web, from news websites to NGO reports and social media. We set out to find a way to translate all that information into powerful, digestible, and actionable insights. In eight years, we’ve created the most extensive data lake in the industry that relies not only on social media but also on forums, review sites, and premium data. Today, the data lake comprises nearly 20 billion articles and grows by 20% year over year.

As we alluded to earlier, the real key to the treasure trove is the technology that uncovers and synthesizes all that data: artificial intelligence, particularly natural language processing (NLP). Our highly-talented technical team developed advanced algorithms to accurately “read” web articles and distill them into only the most relevant data for our users, received as signals and alerts.

In these eight years, we’ve been able to serve and work with some of the brightest minds in the industry who have trusted us with multiple challenges. Asset managers, private equity firms, and corporations leverage SESAMm’s products for investment strategies, deal sourcing, due diligence, portfolio monitoring, and ESG and positive impact indicators.

In particular, we’re using our technology to transform the ESG industry. For example, we help track controversies and monitor the positive impact for companies that no one else covers in the entire world.

Our team and values

As we proudly surpass the 100-employees mark soon, this is a good moment for us to pause and reflect on where we are and where we want to go. Our mission, to become the world’s reference for textual web data analysis, hasn’t changed. We’re more convinced than ever that we are on the right path to achieving that goal.

Our team collaborates between six different sites in 5 countries, many offices, and various cultures. As a deep-tech company, 70% of the group comprises PhDs, engineers, and developers. Moreover, they’re an amazing team that follows horizontal management and servant-leadership approaches, part of the culture we value and insist on.

To close SESAMm's first eight years on a high note, Forbes included me on their 30 under 30 list only a few weeks ago. In my eyes, that is a big recognition of the company and the work the team has done over the years.

Our future

More ESG. As we mentioned before, we want to transform the ESG industry. Currently, we cover a total of close to five million public and private firms. We aim to bring more transparency to the market and align with new regulatory frameworks in a fast-moving environment. By better analyzing companies, we believe we can help investors push for change. For example, to help monitor for positive impact and align with UN sustainable development goals (SDG), we’re launching a new product to systematically generate these types of alerts.

Of course, we want to bring these technologies to new clients, like:

• Private equity firms
• Quantitative asset managers
• High-yield portfolio managers
• Corporations to fuel their CSR strategy

From CSR teams looking to evaluate their clients and suppliers from an ESG perspective to central data and analytics teams wishing to generate custom NLP analytics at scale, SESAMm aims to become a central solution.

More importantly, we want to democratize NLP web data. This battle for good technology is our ultimate goal because every large company will need to address this topic at one point or another. So when it’s your turn, we want to be there to make it easier for you to achieve tangible results.

And last but not least, as a fintech company, we set our goals and ambitions on higher grounds whenever we complete a funding round. Our Series B with major private equity firm The Carlyle Group (CG) and New Alpha, a Paris-based fintech VC, was a significant step up. And the more we scale, the bigger we see the potential to apply our tools within existing or new fields, industries, use cases, and countries. This step-up naturally inspires us to plan for new ways to grow, whether with new services or reflecting on the potential of an upcoming funding round.

Our appreciation

Thank you. Without you, we wouldn’t be here. Special thanks to the SESAMm team. To our investors, The Carlyle Group, New Alpha, Havenrock, Caisse d’Epargne, AngelSquare, and more. To our partners and all who have supported us along this journey. And most of all, thank you, our clients. Because of you all, we have grown from a small-city-of-Metz team into an international company.

Cheers to you, us, and our future. Happy 8th anniversary, SESAMm!🥂

Oh, right! The trivia question! Here’s the answer.
SESAMm is an acronym for:

• Stock
• Exchange
• Statistical
• Analysis
• Mechanism

The “Mm” in SESAMm hints at the French pronunciation of sésame. But mostly, we used the small m from the word Mechanism instead of an e to guarantee that the URL would be available.