Source of Article: https://www.startlandnews.com/2023/04/dataappraisal/
Kansas City’s DataAppraisal has secured $900,000 in pre-seed funding for its AI-powered proprietary software that helps healthcare organizations unlock the monetary value of their enterprise data, said Tam Tran.
And the tech startup’s recent developments come after a year of earning local resources and support, its co-founder and CEO said.
DataAppraisal’s unique solution contains two elements, Tran detailed: AI appraisal tech that assesses the monetary value of a company’s data — similar to how a Zestimate on Zillow estimates the cost of a home — and a marketplace-style exchange that matches data providers with purchasers.
“The biggest hurdles in organizations about data monetization are that they don’t know what their data is worth, so they don’t know how many resources to spend on it, and they don’t even know that they could monetize their data,” Tran said.
Organizations often fail to understand that data is a product that holds value for other companies, Tran added.
“Someone else solving a different problem can use that data to help train your model,” he said. “What makes us unique is our deep tech appraisal technology really gives these organizations insights and the ability to execute on a data monetization strategy.”
DataAppraisal’s pre-seed funding — which includes an investment from the GROWKS Equity Program managed by Network Kansas — is expected to be used to expand the team from three to seven, Tran said, so the startup can add resources in the areas of sales, as well as research and development.
The R&D and engineering side will help us really fine-tune our appraisal models and also help us build out the exchange,” Tran said. “Then the sales and the marketing side will help us really fine-tune the sales process, making sure that we’re really understanding the customers and solving their needs.”
Beyond the pre-seed funding, DataAppraisal was awarded $50,000 from LaunchKC in November, and previously received a $20,000 grant from Digital Sandbox KC.
Tran and Ngo are also fellows in the Pipeline Pathfinder cohort, Tran shared.
He credited the support — both in terms of funding and mentorship — from those organizations as a critical component of DataAppraisal reaching this stage, with plans for more on the horizon.
“We’re able to tap into a network of advisors and mentors that already have experience in the space and who really give us that knowledge, and also navigate us through some of the hurdles that we currently have,” Tran said. “They have really tremendously helped us. It wouldn’t have happened without these different organizations.”
Tran said he sees that entrepreneurial spirit permeating throughout Kansas City, as the community all uplifts each other in pursuit of mutually beneficial outcomes.
“Everyone here so far who I’ve seen has some sort of entrepreneurial spirit in them, and are always helping the community drive to a better story,” Tran said. “That story is, ‘Can we make Kansas City a more entrepreneurial city?’ Everyone here has that spirit; everyone here is very encouraging; and everyone here wants everyone to win.”
Pilot on patient care
DataAppraisal just released its data exchange driven by its deep tech appraisal technology, Tran said, with the company partnering alongside two rural hospitals in western Kansas — Greeley County Health Services and Hodgeman County Health Center — for a pilot program.
Rural hospitals and healthcare organizations are an especially natural fit for DataAppraisal, Tran said, because they need to create sources of revenue through creative methods in order to improve patient care; DataAppraisal shares that end goal, he added.
“They’re already working on slim margins; they’re already understaffed; they’re already fighting the bigger hospitals to get the best doctors,” Tran said. “The quality of patient care trumps all. Everything we do has to improve patient care.”
Hospitals could provide data to pharmaceutical companies, clinical researchers, payers, and/or tech companies, Tran said, describing that exchange as a positive for all parties involved.
“They all win, because [data] helps them train their models and better their services,” Tran said. “It also helps the rural hospitals. Because of that data collaboration and commercialization, now the money trickles back into patient care, ultimately. We’re the tool to enable that whole process.”
Protected by firewall
In building DataAppraisal’s software, Tran said he and co-founder Roger Ngo were intentional in keeping patient privacy top of mind. (Riddhiman Das, co-founder of the Kansas City-based AI privacy tech startup TripleBlind, notably is among DataAppraisal’s board members.)
The application sits on-premise behind a firewall and is fully compliant with HIPAA laws, he added.
The AI-driven appraisal technology — which Tran called the most unique aspect of the business — collects and shares “macro-level data,” he said.
“It’s more macro level data, enough for us to essentially build a CARFAX around what the data is worth,” Tran said. “Think of a Zestimate or a CARFAX report: enough to know what your data is worth, but not enough to identify what’s inside of it.”
For instance, a data set could show the rate at which pharmaceutical ADHD drugs are being used at a particular hospital or healthcare organization, but not who’s using them, Tran said.
For the exchange, DataAppraisal goes to great lengths to ensure it only works with ethical companies, said Tran.
“We built a governance process to make sure that both parties are ethical companies, make sure BBB ratings are good, make sure leadership teams from both parties have nothing that is unethical around data,” he said. “We do a lot of checking, and we make sure that we meet the data providers’ criteria for compliance — whatever boxes they need us to check for that agreement, we’ll make sure the purchaser agrees to those terms.”
Once the data gets released from provider to purchaser, DataAppraisal never touches the data, Tran said.
Beyond the obvious purchasers within healthcare and technology, Tran suggested that private equity firms, government agencies, and academic institutions could benefit from the data.
“There’s so much data being collected across the board in a hospital environment that it really affects everything you see around you,” Tran said.
Built on a 20-year foundation
Tran and Ngo founded DataAppraisal in 2021, though the two have known each other for decades, as Ngo and Tran’s older brother were good friends growing up in Kansas City, Tran shared, noting that he viewed Ngo as a role model.
“Our stories were very similar,” Tran said. “Both our parents came from Vietnam — he was born there, I’m a first-generation [immigrant] — so we grew up not having much. Getting our college degrees was a big milestone.”
Fast forward to 2021, when Tran was approached by a client about creative solutions to maintain profits during the pandemic, leading to a brainstorming session that ultimately led to DataAppraisal.
“The a-ha moment was, ‘Instead of hiring data scientists and business analysts to look at your data, what if you knew the value of your data? What would you do if you knew the value of your data?’” Tran recalled.
“You could do so much if you knew the value of data,” he continued. “You could monetize it; you could commercialize it; you could collaborate on it; you could try to get insurance on it; you could try to go raise funds from it. There’s so many things you could do.”
Tran and that friend spent the next few weeks researching patents, only to find that the lone comparable product in existence was the Zestimate from Zillow, which Tran noted exists in a completely different vertical.
“There is nobody in the space that does what DataAppraisal does,” he said. “The only competitor in a space that does remotely close to what DataAppraisal does is Zestimate from Zillow, and there’s no competition there. I tell people, ‘We’re the Zestimate for enterprise data.’”
Later in 2021, Tran sought out advice from Ngo, he said, before ultimately asking him to join him as a co-founder in 2022.
“Everything that he’s done so far and learned so far — with some destiny and luck — has brought us all to here, this moment,” Tran recalled telling Ngo at the time.
The duo’s long-standing friendship ensures that they know how to complement one another, Tran said, matching strengths and weaknesses.
“We’ve had a trusting relationship for over 20 years,” Tran said. “We know our strengths and weaknesses. We know that our skill sets are very complementary. We believe that this could be the next unicorn.”
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