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Sunday, May 09, 2021

Using AI for Contract Negotiations

Nothing mentioned about 'smart contracts', but surely you can see the possibilities linking from this. ?   They say that Walmart has been a user of the idea. 

How Companies Use AI for Contract Negotiations

For foodies traveling the Baltics, you’ll find Lithuania has some of the best food hands down – kugelis, kapusta, and bundookie buns should be on your to-do list. In second place would be Latvia. Look no further than buffet food chain Lido for some seriously good Baltic fare. Then there’s the black sheep of the bunch, Estonia. Whoever thought putting peaches on pizza was a good idea should be taken out behind the kitchen and shot. This culinary faux pas could be because Estonians spend all their time honing their tech skills instead of messing around in the kitchen.

Another Estonian Startup Making Headlines

Prior to The Rona, our MBAs were scouting tech startups across the globe from Saudi Arabia to Russia. One country we visited last year was Estonia where we met with Skeleton Technologies (ultracapacitors) and Veriff (global identity verification). Recently, both companies raised sizable funding rounds – Veriff raised $65 million a few weeks ago and Skeleton $61 million last month. We also looked at 9 Artificial Intelligence Startups in Estonia, and one company not on that list was Pactum, an AI startup that’s been garnering some attention lately with their AI algorithms that negotiate contracts.

About Pactum AI:     https://pactum.com/

Estonia is often said to be one of the most digitally advanced countries in the world, and her e-residency program attracts tech talent from across the globe. The Founding Managing Director of that program, Kaspar Korjus, is renowned in Estonia for his technical prowess. He was one of three people that founded Pactum AI in 2019 to help companies “unlock value from thousands of suppliers by automatically negotiating contracts on a massive scale.” This foreign fintech firm has quietly snuck into the Silicon Valley Vatican and now sports a Mountain View address along with $15.2 million in funding and the best reference customer you could ask for – dividend growth champion Walmart (WMT) – the largest corporation by revenue globally, and one of Pactum’s most supportive customers.

Pactum’s most recent round of funding was an $11 million Series A which closed just days ago, putting them on the radar of investors and potential customers as they look to offer contract negotiation services to companies with $1 billion of revenues or more. The process starts with two weeks of discovery, after which the algorithms take over and start negotiating tail spend contracts. For most companies, around 80% of their commercial agreements are high volume and low value – tail spend. Pactum can unlock a significant amount of hidden value in tail-spend contracts, reducing spend by 2% to 11% per $100m of tail spend. As for pricing, they only charge for successful deals that add value, essentially guaranteeing an ROI for every project they’re working on. They also offer a “gain share” pricing model which takes 25% of the gain a renegotiation generates. We love AI companies that are so confident in their product they simply take a cut of all the money they’re saving their clients.  ... " 

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