Silicon Valley-based AI startup Allganize revs up to go public in Japan 

Allganize Inc., a Silicon Valley-based artificial intelligence (AI) startup, recently announced the company will relocate some of its headquarters functions to Tokyo, Japan. 

Serial entrepreneur Lee Chang-su founded the startup in 2017 in Silicon Valley and set up local offices in Seoul and Tokyo. It has since added offices in Houston, Texas, and Belfast, the United Kingdom. 

But because the Tokyo office generates about 70% of its total revenue, the startup is aiming to get listed on the Tokyo Stock Exchange. 

In an interview with The Korea Economic Daily, CEO Lee said that Japanese companies are embracing remote work following the COVID-19 pandemic and subsequently demanding more international-standard Software as a Service (SaaS).

“The Japanese corporate culture uses a lot of documents and manuals, which increases the need for employees to weed through the text quickly,” Lee explained. “This is where our Cognitive Search product comes in handy.” 

Alli AI Answer Bot, NER API, Review Analysis API, Sentiment API, and Text Classification API are some of the other products the company provides. 

Thanks to natural language processing (NLP) technology, Alli can even interpret charts and graphs included in documents and Excel spreadsheets. 

Prior to Allganize, Lee founded 5Rocks, which provides analysis of the mobile game industry's userbase information. 

The startup was based in South Korea and Japan; and had more than 600 game developers as clients, such as Gamevil Inc., currently rebranded as Com2uS Holdings, and gumi Inc., to name a couple.

Lee enjoyed a lucrative exit when Santa Barbara-based Tapjoy acquired 5Rocks in August 2014.

TAG-FREE

What sets Allganize’s products apart from other NLP-driven search engine solutions is that it does away with the tagging or labeling. 

A tag refers to a keyword or term assigned to a piece of information. The metadata helps describe an item and allows it to be found again by browsing or searching.

This process can be time-consuming and tedious.

Alli learns from the various open source texts and datasets instead of tagging and only takes a day to establish the program. 

An Allganize employee explained that one of its Japanese conglomerate clients had switched from another US-based company’s solutions to the startup to avoid the lengthy tagging process. 

Japan’s biggest securities firm Nomura Securities Co., telecom giant KDDI Corp., and multinational banking institute Sumitomo Mitsui Banking Corporation Group (SMBC) are some of its biggest clients. 

In the case of SMBC, it began as a client of Allganize but later ended up investing in the startup as well. 

Industry insiders say the core of a successful AI service is how much finesse it can bring to cleaning up and utilizing quality data.

An AI startup has to differentiate itself from the Big Tech such as Naver Corp., Kakao Corp., or Alphabet Inc.’s Google, which have unmatched quantities of data. 

“Whereas conglomerates are akin to top students in most subjects including the AI, startups have to be like winners of Math Olympiad who aces in a very specialized field,” an Allganize employee said. 

Write to Da Eun Choi at max@hankyung.com
Jee Abbey Lee edited this article.