by Sean Silcoff
An Ottawa startup that is using artificial intelligence to transform how auditors and financial regulators unearth fraud and irregularities has secured $29.6-million in venture capital and government funding.
Mindbridge Analytics Inc. chief executive Eli Fathi told The Globe and Mail the company has raised $15.1-million in venture capital led by New York’s PeakSpan Capital in a group that includes existing Canadian investors Real Ventures, National Bank of Canada, the Group Ventures and New York’s Reciprocal Ventures.
And on Wednesday, federal Innovation Minister Navdeep Bains will announce that Ottawa is committing $14.5-million to Mindbridge through its Strategic Innovation Fund. The money will be paid over seven years, offsetting some of the company’s research and development spending as it broadens its cloud-based platform for applications in a range of industries.
Mindbridge’s software helps auditors by reviewing all accounting entries within a particular assignment, such as an audit of a company’s general ledger. That compares with the standard practice in which auditors manually review only a fraction of transactions. The software flags irregularities or questionable entries that auditors can examine more closely. The company says the tool is not meant to replace auditors, but make them more effective at pinpointing problems.
“The entire market of auditors will adopt AI,” PeakSpan partner Brian Mulvey said. “Those who don’t will cease to be relevant.”
The company, an early mover in Canada’s thriving artificial intelligence (AI) scene, has 260 certified public accounting firm customers in 14 countries, including 40 of the top 100 CPA firms in the United States, and has done projects for the Bank of England and Payments Canada, the body that oversees the movement of funds between Canadian financial institutions. Payments Canada chief legal officer Anne Butler said the liquidity management system Mindbridge is building to monitor large-sized transfers “is giving us intelligence we didn’t have previously to monitor and be informed more quickly where there may be problems.”
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