Michael Dean, founding partner at AgFunder, led the firm’s investment in Ai Palette – its first in Singapore and second in Asia. AgFunder invested as part of a $1.04 million seed round led by Decacorn Capital, an investor in Lyft, Snapchat, Spotify, and Postmates.
Eighty-five percent of new food products fail within two years. According to Nielsen, only 71 out of 3,463 products launched in 2012 sold more than $50 million. The main reason? A failure to meet consumer needs.
That’s incredibly costly for large CPG companies — think billions of dollars — particularly as they try to stay relevant amid a rapidly-growing, and often very successful, startup CPG ecosystem.
Seeing the massive opportunity to reduce failures and direct that investment into products consumers actually want, we’ve just invested in Ai Palette. It’s a Singapore-based SaaS startup that’s working to address these problems in the $4 trillion FMCG (fast-moving consumer goods) industry.
Ai Palette uses predictive analytics, Natural Language Processing (NLP) and
computer vision to capture trends in real-time from a diverse set of sources including blogs, social media, recipes, and menus. This palette of AI solutions gives CPG companies insights into emerging taste preferences across the globe to help them plan what new product formulations to launch and when.
Unexpectedly, the team found that images provide deeper and more meaningful insights than text, so they use computer vision to analyse food consumption images and provide contextual consumer insights at scale.
And with 39 unique factors built into their algorithms, Ai Palette allows brands to predict and identify flavour trends as they emerge locally. Since their algorithms are able to monitor and evaluate trends in eight Asian languages as well as English, they can highlight cross-cultural trends. These flavour memes can be tracked as they migrate across borders.
After trend identification come Ai Palette’s more involved offerings including product screening — where it analyses multiple product concepts created by the brand’s managers and tells them which to launch next for maximum chance of success — and its “build winner” product, where it creates new product concepts for the brand based on consumer needs and the brand’s own portfolio.
Through these services, Ai Palette significantly reduces the time it takes companies to create successful products; six months rather than one to two years.
According to McKinsey, Artificial Intelligence could create an impact of $53.6 billion in CPG Product Development, and we think Ai Palette are the ones to do it.
Somsubhra GanChoudhuri, the cofounder and CEO, spent seven years at leading CPG company Givaudan in Singapore after completing his MBA in India. His cofounder and CTO, Himanshu Upreti, was a senior software engineer at Visa Data Labs and has a degree from the Indian Institute of Technology.
For our co-investor Decacorn Capital, the endorsement of several leading multinational FMCG giants reinforced their belief that “Ai Palette will be the preferred choice for global consumer brands to engineer product launches successfully.”
The Singapore government’s SG Innovate and existing investor Entrepreneur First, backed by Greylock, also joined the round.
Ai Palette is already well into revenue with contracts from several Fortune 500 listed food giants and plans to use the proceeds mainly to grow key customer accounts across multiple markets by fast-tracking product development in order to strengthen the platform capabilities.