Brushing aside concerns about AI’s impact, LatentView Analytics’ senior leadership believes generative AI is actually increasing demand for data analytics by cutting the time and effort each task takes. The company builds statistical and machine learning models and data systems that help large enterprises forecast demand and target customer segments. In an interview, CEO Rajan Sethuraman and founder-chairperson Venkat Viswanathan said the shift towards governance, token costs and measurable returns is changing industry dynamics. Excerpts:What has changed in the last three years with AI?There have been many orbital shifts, some we drove ourselves, including listing in the public markets in 2021 and acquiring Decision Point. We have built ML models since our early days, and we see AI as a force multiplier across our math, data and application layers. It lets us iterate quickly and show results for customers. Every organisation must prepare for this new reality. AI is shining a light on granular data, helping companies make more sophisticated decisions about their customers, vendors and partners.There are concerns of AI commoditising some servicesAI is crunching the time and effort traditional analysis needs while opening up new possibilities, so we see the pie expanding, not shrinking. Large language models can handle certain tasks. But enterprises are realizing if they hand 90% of their unique data and context to public models, they give away their competitive edge. They would rather keep their context, culture and governance in-house. That architecture has to be built individually for every enterprise, so the actual quantum of work for service providers is growing. And because AI lets companies do far more within existing budgets, it is pushing up the volume of demand.But we saw spending shrink at one of your major clients. Are there risks of enterprises cutting spending?That rationalisation comes from intense cost-cutting, as tech companies have poured huge capital into AI infrastructure. There is a lot of flux and hype right now, but a reality check is coming once the big AI players finish IPOs and the market wants to see real revenue. The focus will then shift to token economics and return on investment. Many companies will take a hard look and realise they are better off with a simpler, cheaper machine-learning model than forcing in a generative AI solution. We expect the tech sector’s share in our revenue mix to drop to 50% in four to five years due to faster growth in verticals like financial services, consumer goods and healthcare.How has the company evolved over 20 years? What next?We started in 2006 from corporate backgrounds and gave ourselves a three to five-year runway to see if it would work. The early years were a struggle through the financial crisis, and we survived by being frugal. Once the market stabilised around 2010, the business took off. That discipline matters in today’s AI landscape, where providers have to spend on new capabilities ahead of the curve. We are gunning for 20% revenue growth this year, the same as last year, and we want to hit $200 million in revenue by the end of next year. Organic growth alone may leave a gap against those targets, so we expect to make further strategic acquisitions.What’s your AI revenue? How exactly do you classify that?We recently classified our work into three buckets. About 50% of our total work now involves AI in some form. Roughly 25% of revenue is what we call primary AI work, where AI is highly visible to the customer, who may be interacting with a generative AI tool. Another 25% is secondary AI, where AI powers the back-end data pipelines and dashboards. The remaining 50% comes from traditional analytics.Are you moving away from the retainer model?Outcome-based pricing is still evolving. Our dominant model remains effort-based, with about 70% of our work runs on retainer or managed services, where clients pay for a set capacity or headcount. But we are pushing hard internally to move towards fixed-fee, deliverable, and outcome-based models, taking them from 20% now to at least 30% over the next couple of years.
