David Plon remembers his first taste of being an investor. He was in middle school when his dad gave him access to his E*Trade account, and he traded his first stock. Plon said he’s always been “fascinated by investing in the markets.”
That passion took him to roles at places like Barclays Capital, Slate Path Capital LP and The Baupost Group, based here in Boston, working as an analyst. Plon attended the University of Virginia and went on to earn his MBA from Stanford University from 2015-2017.
During his time in graduate school, Plon began studying the intersection of machine learning and finance.
“I just had a feeling that at some point, the technology would be really useful for just addressing a lot of the friction points inherent in the investment research process,” Plon said. “Over the last few years, I got increasingly convinced that that moment was now.”
Plon and Connell Gough, a full stack developer, took advantage of this momentum, and in 2022, they co-founded the Boston-based startup, Portrait Analytics. Their team is building a generative AI research assistant for investors.
This week, Portrait Analytics announced that it raised $7 million in new funding led by Unusual Ventures, with participation from existing investor .406 Ventures and hedge fund professionals. That brings the company’s total capital raised to $10 million.
“Modern large language models have powerful reasoning capabilities and the potential to transform research-driven workflows,” Lars Albright, general partner at Unusual Ventures, said in a statement. “But off-the-shelf implementations of these models, such as ChatGPT, lack the domain-specific expertise, data and user-interface to meet the full set of needs of professionals in the investment research field. Portrait is purpose-built to unleash the power of AI for analysts and investors.”
Plon said he loved working as an analyst, but wished there was a more efficient way to complete some processes.
Part of the job is reviewing thousands of pages of documents and “taking all that information and boiling it down into a compressed analysis and thoughts that ultimately inform an investment thesis.”
Then there’s the fun part, Plon said. His favorite work involved “learning and thinking and making decisions, and trying to frame what could be an interesting opportunity" based on that research.
The biggest challenge investors face is their capacity to read and process information, Plon said. Investors need to not only understand the state of an industry or company today, Plon said, but also its history looking decades into the past.
“That’s incredibly rote, incredibly time-consuming,” Plon said. “But everything I just described is something AI should be, and we believe is, really good at.”
Plon said AI can be used to discover and distill large quantities of information. He doesn’t believe it’s ready to give advice on investing. However, he believes AI could give investors highlights of historical financial statements or describe how a business model works.
Portrait Analytics’ platform will develop comprehensive reports about a company or industry. It will also answer analysts’ questions and perform research tasks. Plon said they have pilot customers testing the technology.
The company has five full-time employees, Plon said, and plans to expand with its new funding to seven or eight team members in the next few weeks.
Plon said speed is of the essence amongst companies innovating with AI, and raising new capital now will allow the company to accelerate the pace at which it iterates on its platform and bring people off the waitlist.
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