Three startups explored the growth of big data at the 2012 Conference on Entrepreneurship.
Big Data is the latest industry that entrepreneurs are exploring. It involves collecting, storing, and analyzing personal and other data generated by an increasingly digitalized world. Three startups presented their views on the topic at the Stanford GSB 2012 Conference on Entrepreneurship.
Joshua Feast, founder and CEO of Cogito Software, is a software company that aims to improve healthcare by using analytics to predict moods and behavior. Shane Green, president and CEO at Personal, allows users to collect all the data they have on themselves and decide whether or not to share that information with advertisers. Charles Zedlewski, vice president of Cloudera’s products division, helps companies harness the enormous amounts of data Big Data provides. The following are edited excerpts of a panel moderated by Andrew de Maar, MBA Candidate 2012.
Why is Big Data so popular now? What is its potential
Charles Zedlewski: I’ve noticed that data growth is faster than Moore’s Law. Moore’s Law is beaten by the collective ability of machines, systems, and phones to generate data. This means that there will always be a shortage of memory and servers. This is an excellent opportunity for MBAs and entrepreneurs alike. Each time a platform is launched, it marks the start of a new era. There are companies in every generation that ride this wave. Cloudera, I’d argue, is part of the first generation. We’re starting to see the first sparks of the second generation. There are still many more to come. It’s a fascinating time.
What are the current trends in Big Data
Shane Green: This is only the beginning — top of the first inn. I think you will see many people falling by the wayside. Data is now becoming more commoditized, I guess. Collecting data that can be used to make decisions is very difficult. Even those who manage the data don’t always realize that they’ve done so and aren’t sure what to do once they’ve got it. The next trend is: How do you maintain and find a competitive edge and access data nobody else has?
Regulating is another trend that probably won’t be popular here. It will be a significant trend, mainly because of privacy and security concerns. In Europe, it is already happening and has stifled innovation. The issues that have been identified will be addressed.
What industries will most likely be transformed by Big Data in the near- and medium-term
Shane Green, There aren’t many industries where it won’t have an impact. I am very focused on advertising. Google’s fortune was built on increasing the industry’s 2% success rate to 3%. This is still a 97% rate of failure. If you ask around, there aren’t too many industries built on such a high failure rate.
What are the current mechanisms to consider the economic value of data
Joshua Feast, some pieces of data we see in the insurance industry show an individual’s risk profile is worth thousands of dollars. This is because insurance companies manage their populations based on risk levels. If they know a specific population is more risky than another, they can manage their pricing better.
What are the entrepreneurial opportunities in Big Data for MBAs
Shane Green: I find it interesting that people often use two analogies to describe data. Data is the new Oil because we’re talking about Big Data at the same early stage as people did 100 years ago when they were talking about Big Oil. We are familiar with the industries that grew up around Oil. You had to extract it, refine and ship it. Last year, the World Economic Forum released a report that I love. The World Economic Forum said personal data was becoming a class of economic assets. People will manage it just as carefully if they don’t, more so than how they handle their money. You can find everything in the financial world, from banks to financial managers to insurance. You’ll see analogs in all industries as businesses merge around data. This trend will not be around for a short time and then disappear. The data industry will continue to grow, and there will be a need for all these businesses, including those we have never thought of.
