Pictured: The AlphaLayer team at the AIMCo Headquarters
As industries around the world explore the potentials of artificial intelligence (AI) and machine learning (ML), AIMCo is at the forefront. In 2018, the investment manager joined forces with Edmonton-based AltaML to try an experiment. Each month AIMCo receives approximately 200 real estate capital call and distribution notices. These are requests for distributions of cash related to properties and funds in the real estate portfolio. It takes an AIMCo employee about 15 minutes to process each request utilizing email, spreadsheets and PDFs, and then enter the relevant data into the accounting system.
Enter Milton. AltaML’s machine learning bot named after economist Milton Friedman scans the emails, picks out the necessary numbers and codes and prepares a request for a human to look over and approve. In addition, Milton has been integrated with AIMCo’s software to create the necessary files for both retention and upload into the accounting system. The AI process is done in less than five seconds, with excellent accuracy. An AIMCo team member can then do a quick last check before sending off.
Despite the media reporting on the “sexy” applications of AI in robotics and autonomous driving, it is these routine processes that are the best use-cases for machine learning, according to Cory Janssen, AltaML’s co-founder and CEO.
The new way of doing things will save approximately 50 hours a month, freeing up AIMCo employees to do more meaningful and rewarding work and showing tangible benefits in the application of machine learning solutions. The intention is to utilize Milton for similar processes in each of AIMCo’s illiquid asset classes.
“Milton provided the proof of concept we needed to move full speed ahead with this aspect of our innovation strategy,” said Michael Baker AIMCo’s senior vice president of strategic implementation.
With that small but mighty success, AIMCo is eager to explore even more opportunities for innovation. In June, AIMCo and AltaML announced AlphaLayer, a partnership to build AI and ML applications within the investment management space.
What’s next? The team is working on a number of projects that will help AIMCo work smarter and faster for its clients. Some of them involve using data to create models to predict the likelihood of a certain outcome. Predictions and insights leveraged by machine learning could be key in helping investment teams make decisions on deals to pursue to generate excess returns.
“The costs of computers, storage and collecting data are now just a fraction of what they were years ago,” said Janssen. “That’s really opened up the possibilities for using machine learning models to tackle business problems, especially when it comes to cases where we are trying to make predictions.”
Other projects are exploring intelligent automation for processes that have been done a certain way for years. In those cases, the goal is to improve operational efficiency, providing even better value for clients. “When we gathered people from all parts of AIMCo to brainstorm for use cases to pursue, we received more than 100 ideas,” said Baker. “Some of them were moonshots, but the excitement around what might be possible was really inspiring. It proved that our team is ready and willing to innovate.”