Aviso Aims To Take Guesswork Out Of Earnings Forecasts

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Aviso came out of stealth mode today with the goal of helping companies provide more accurate earnings forecasts.

K.V. Rao, co-founder and CEO at Aviso explained that the company has been working on the problem for two years and they hope to make earnings forecasting, which when wrong can cost companies millions in market cap, less about gut and instinct and more about data-driven decision making.

What they’ve created is cloud-based forecasting tool, but Rao said they want to do more than provide projections on future activity –as he said, “you can know the weather and still not be able to do anything about it.” He said that Aviso hopes to provide information to help guide customers to improve the results, or as he put it “move the needle.”

Rao said to do this correctly, they really needed the power of a cloud platform to handle the sheer amount of data involved. “To do this right, we do a lot of computations, billions of computations that involve machine learning and portfolio management techniques.”  And he said, that requires the scalability only the cloud provides.

He pointed out that even though it’s a cloud app, it needs to interface with enterprise information systems. Aviso grabs this information and then processes it and presents it to users.

How does it do this? Rao said Aviso is using techniques that have been developed at investment banks. In fact, his co-founder, Andrew Abrahams is the former Global Head of Quantitative Research and Model Oversight at JP Morgan Chase. Rao said the company has used techniques that were successful at investment banks.

What they are doing, Rao explained, is replacing investment assets with enterprise assets such as customers, leads and opportunities and treating them like financial instruments while providing a deeper look at these by product line, geography, business unit and so forth. They look at this package of data as a portfolio of revenue indicators and then provide information to make what Rao called, “the right bets on the portfolio.”

He admitted that we have seen that investment banks do sometimes make the wrong calls as the Global Financial Crisis of 2008 would attest, but he suggested that banks that used data instead of human ego came out of that in better shape.

Rao said he doesn’t necessarily want to take humans out of the decision making process, and he understand that no matter how much data a company has, a key decision maker can always ignore it, but he wants to give companies to the tools to make more data-driven decisions and the rest is up to them.

Aviso also just closed $8 Million Series A Funding involving Shasta Ventures, Cowboy Ventures, First Round Capital and Bloomberg Beta. It’s also worth noting that it has received financial support from current and former technology industry executives including Subrah Iyar, founder and CEO of WebEx; Roger Sippl, who was founder and CEO of Informix and Vantive; Dave Hersh, founding CEO of Jive Software who is now with Andreessen Horowitz ; and Ron Gill, who is currently CFO of NetSuite.