Governmental Friction Issue:
Palantir Governmental Lawsuit Importance:
Palantir’s Issue Of Talent:
Data As Ammunition:
Palantir VS Snowflake:
Governmental Friction Issue:
There are major similarities between larger corporations and Governments. Doug Philippone expressed his view on the bureaucratic nature of larger companies, in which can often effect the procurement process within software integration.
Often within larger software projects, nothing actually is achieved. To add, the Government sphere points towards the issues of recruitment and acquisition processes. This is because once projects are completed within Governments, these projects end-up not working properly, resulting in much higher costs associated with the initial development. This compares to Palantir, who have a functioning product, but then can lightly modify the product in order to deliver value.
The Palantir Defence Leader expressed his concern with the Governmental acquisition processes. There is so much friction associated within Governments and these acquisition processes can make it very hard for companies to “break-in” successfully. However, Palantir has an evident edge within this sphere, because often Palantir is competing with PowerPoints, or CIOs whom are showcasing a product they hope to build within the next few years. Doug mentioned how these CIOs, and PowerPoints showcasing a product never end up succeeding, and if they do, often the cost associated is 10X greater.
ARK Invest within recent time periods expressed their concerns regarding Palantir & the Governmental slowdown, citing higher competitive environments in which therefore have led to an inability for Palantir to successfully win contracts. However, this seems to be in opposition to the view of Doug Philippone as he cites the fact “institutional walls that are present”, and therefore the Government slow-down has more association with the bureaucratic walls that are present within Governments.
Palantir Governmental Lawsuit Importance:
For example, back in 2019 Palantir was involved within a lawsuit with the US Government based on the USCC2377 Commercial Item Preference Law. This law states how Governments must look towards the commercial markets before attempting to build in-house solutions. Back in the 1980s Governments were building everything in house, leading to much higher costs and a lack of successfully functioning products. Doug expressed Palantir’s unfortunate association with the partisans & the overall elongated decision making processes within Governments.
Doug mentioned how “soldiers wanted our platforms”, however the friction associated within Governments was immense.
Palantir after winning the lawsuit, ended up setting precedent for the case, reinforcing the necessity that Governments must look towards commercial clients first – instead of trying to build everything in-house.
Doug stated how there are unique problems within selling software. Often it is hard to tell if software actually works. Commonly present is the miss-match between a casual observer understanding if the software functions or not. This can become problematic for software companies – if these companies are unable to showcase their product in real-time.
Practically speaking, sometimes Governments still attempt to build solutions in-house first. This was in full knowledge that the Governments solutions fail 93% of time. Unfortunately, Governments would just “change the name” of the project, and continue the progression. Doug specifically stated how there are small political pockets in who still want to build bespoke software solutions in-house. This has been an evident issue investors are aware of within Palantir.
Palantir’s Issue Of Talent:
As a whole, Doug indicated towards the immense profession of Palantir. He mentioned how Palantir makes the “best software within the world” – and second place “is at least 10 steps behind us. Period.”
However, there is a looming issue that Doug expressed. This is the clear danger of Palantir loosing talent based on the politically unstable Governmental issues. To explain in detail, because Governments are inherently political and bureaucratic, this can lead to major friction associated with the best software product being selected.
Doug plead to the Government within the interview to allow the best products to successfully win.
If talent within Palantir becomes disheartened due to the innate friction associated within Governments, this can lead to Palantir talent leaving the company for other organisations – such as Meta.
The good news is however that Palantir has fostered the correct environment within their organisation. Thankfully, as expressed by Doug Philippone, Palantir employees understand the necessity of Palantir & their work within Governments in order to achieve the success of the West.
Once again, importantly reiterating the previous point, Doug expressed his plea towards Governments, citing the fact that Governments must remove friction and therefore allow the best products to win. If this is not the case, Palantir’s talent will leave the company and end-up working with companies to build video games or advertising models.
As stated within a recent report by Arnaldo Trezzi, reports suggest strongly towards the necessity of talent to gain a productivity advantage. For example, the best talent can lead to an 800% productivity improvement, in comparison to average talent. This indicates that Palantir has a necessity to retain and recruit the world’s best talent.
To read the full report on this, please refer to: https://darntons.com/2022/05/04/when-will-palantir-sbc-ease/
Data As Ammunition:
Doug mentioned specifically how data is the new ammunition for military. Data is all about decision making. This applies to Governments specifically, however also commercial clients across the world. Depending on what part of the world one is talking about, often there is limited abilities for countries to understand what is going on within a certain geographical location.
The importance of data as ammunition is vital. If you have a plane or a satellite, how can individuals understand where this data has come from, and what the pedigree of the data is?
The issue is however, due to the overwhelming amounts of information, often good decisions become very hard to make within a specific time period. Specifically within the military context, there is so much friction associated with finding information.
When it comes to AI, this term if majorly broad and misused. This is because, most AI actually does not work at all. Doug indicated towards the unreliable nature of algorithms within the context of a company. Doug stated how often algorithms that work are often placed on top of a piece of curated data that is not connected towards the real world. This therefore shows the amazing results – however due to the fact this is within a fake environment, often this is unreliable and not truthful.
Doug mentions, how it is vital to find the algorithm that works within the real world within it’s raw form. This therefore can lead to true value prevailing.
Palantir has two main approaches towards AI & ML: firstly, the importance of an operating OS that combines real world data within one place for algorithms to learn on. Often, Doug mentions, projects fail because despite the fact organisations have an algorithm, there is an inability to make this algorithm effective. The Palantir Defence lead said that it will take organisations 5 years to integrate all of the data.
Palantir’s approach is to serve up an integrated data platform with security features, and then companies can put their own algorithms on top. Doug stated how he believes Palantir is really going to change the future in regards to what AI means for companies.
The second main approach for Palantir is to figure out what actually happens – is this actually useful? Palantir are set on detecting unusual patterns or issues in which one wouldn’t see beforehand. Often one is looking at so much information that it can be hard to know what you are actually looking at.
How can I detect something that I just can not see – this is fundamental for Palantir.
Palantir VS Snowflake:
Doug Philippone, Palantir Global Defence Lead: I don’t like the term data-lake. “It always turns into a data-swamp”.
Doug expressed his major concern over a data-lake. 5 years ago organisations were excited for data-lake functionalities. The problem however, “you loose security, you loose pedigree, the data is not alive anymore.” A core fundamental of Palantir – keeping the lineage of the data to understand where the data has come from.
Snowflake enables data storage, processing, and analytic solutions that are faster, easier to use, and far more flexible than traditional offerings. Snowflake provides a data lake-house in which is a new, open data management architecture that combines the flexibility, cost-efficiency, and scale of data lakes with the data management. and transactions of data warehouses. This enables business intelligence (BI) and machine learning (ML) on all data. Overall, Snowflake offers thinner and more individualistic tools. Palantir on the other hand have a holistic OS in which incorporates 400 different tools, features and custom applications within.
Palantir is focused on: auditability of data in real time. Doug stated for Palantir their focus is on, where the data has come from? This isn’t about politics for Palantir, instead the company needs to understand the lineage of the data in order to make the best decisions.
Often one has these individualistic capabilities that work well and are useful, however they interact with data within a siloed manner. Through these individualistic tools, often there is an inability for full empowerment and interoperability of data in conjunction. This results in a majorly difficult atmosphere for deriving the true value from all data.
Listen to the full podcast here:
The problem with conventional data systems is that, as described by Doug, the world is always changing. Often data points and things are not called the same as they were called 5 years ago. The point being is that, within a ridged schema, this becomes a technical challenge over time, and results in an ability for the best knowledge to be derived from data.
Doug expressed his view that enterprise software is very hard to make properly. Often there are many dependencies together, and when a change is made to the frontend, this has ripple effects for the entire data within the enterprise. This is where many companies fail within enterprise software creation.
