Ever since ChatGPT became the fastest growing app in history, artificial intelligence has captured the world’s imagination. The expected implications of AI vary depending on who you are talking to. Some believe this technology will lead to a utopian society, while others believe it will lead to the downfall of civilization as we know it. The truth is somewhere in between.
There isn’t an executive who isn’t having, meetings right now to determine how AI can be used to Improve business processes, increase efficiencies and improve the bottom line. But as AI-related stocks like Invidia go to the moon, we’ve also seen AI-induced growing pains with the like of Google’s Gemini image generator.
As AI continues to be in the news and in our lives, we spoke with Sid Yenamandra, Founder, CEO and Managing Partner of Surge Ventures, a new SaaS venture studio targeting the financial services industry, about the guardrails being put around AI and how they impact the new tools being introduced into the wealth management space.
DWN: Some voices are calling for strict regulations or even outright bans on AI. What type of guidance should be issued to ensure the public can be comfortable with the trajectory of AI development?
Yenamandra: Most people are probably not familiar with the National Institute of Standards and Technology (NIST), but it is part of the U.S. Department of Commerce. Its mission is to promote U.S. innovation and industrial competitiveness by advancing measurement science, standards, and technology in ways that enhance economic security and improve our quality of life. They have begun focusing on AI and I believe their involvement in the space is positive.
The NIST has recently outlined key characteristics that I think are essential for ensuring trustworthy AI systems. The Institute is collaborating with scientists and industry to align AI with ethics, human rights, and community representation initiatives.
Their guidelines are an important step in helping shape what is already proving to be the most consequential technology of the century.
DWN: What are some of the solutions the NIST is promoting to allay some of the fears people have around AI?
Yenamandra: The NIST has issued a series of principles that are fundamental in ensuring responsible and reliable AI use. These basic principles say that AI developers need to be thinking about:
- Validity & Reliability: Accurate, consistent results for intended purpose.
- Safety: Mitigating risks to users, operators, and environment.
- Security & Resiliency: Secure, resilient against disruptions.
- Accountability & Transparency: Understandable, traceable decision-making.
- Explainability & Interpretability: Providing explanations for trust and oversight.
- Privacy: Respecting user privacy, handling data appropriately.
- Fairness: Avoiding bias, ensuring equitable treatment.
DWN: As someone heavily involved in the AI revolution, how are you using these guidelines as you create AI systems, tools and other resources for wealth management and other highly regulated firms?
Yenamandra: As we develop next-generation AI tools, we are always cognizant of our responsibilities to do so ethically and with integrity. The NIST guidelines are a great starting point that we go above and beyond. We will be seeing other forms of responsible AI frameworks come into the fold as well.
At Surge Ventures, our portfolio of comprehensive AI-enabled compliance solutions and services are built to reliably mitigate risks in a secure and resilient way. We are committed to accountability and transparency to gain and maintain trust, privacy and fairness.
For instance, at RegVerse, one of Surge Venture’s portfolio companies, we specialize in providing cutting-edge compliance solutions tailored to meet the unique compliance needs of RIAs and Broker Dealer Firms. Our comprehensive suite of services is designed to develop resilient compliance programs for our firms, ensuring adherence to regulatory standards while minimizing risks. Our team of experts is committed to delivering top-notch solutions that empower organizations to stay ahead of regulatory changes and maintain a strong compliance posture. We’ve developed a product called Avery that leverages AI to streamline regulation analysis, action plan creation, and intelligent assistance for over-stretched compliance departments. Avery was created to help Chief Compliance Officers say goodbye to hours spent on regulatory analysis by breaking down regulations into manageable tasks for easy implementation, review and audit.
Harnessing AI to enhance specific industries and the larger world is not only a huge opportunity, but an awesome responsibility. Innovators don’t typically appreciate constraints, but when it comes to a technology as powerful (and young) as AI, sensible guidelines are important and necessary. I like to think that Surge Ventures and companies like RegVerse are leading by example and showing others how to do AI right.
