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This Big Data Startup Offers Discounts for Customers Who Share Data

February 10, 2016, 4:16 PM UTC
Courtesy of Factual

Many executives and entrepreneurs talk about “big data.” Gil Elbaz, founder and CEO of a Los Angeles-based company called Factual, embodies it.

Big data refers to the way companies are using software, computing power, machine learning, and other buzzwords to solve previously unsolvable problems. From Elbaz’s perspective, however, even companies that call themselves data experts act on data but don’t provide access to it. His prime examples are data giants Google (GOOG), Facebook (FB), and Twitter (TWTR), which say they provide data to other companies but get prickly if partners create products too much like their own. (Yelp (YELP), Zynga (ZNGA), and numerous defenestrated Twitter apps tell this story.)

Elbaz calls Factual’s product a “global places database.” Through a vast network of collection mechanisms, Factual provides the data for other companies to incorporate into their mobile applications. Customers include Apple (AAPL), which used Factual to improve its initially shaky maps. The allure of such data is advertising: Know where a customer is and tell them what’s available, and they are likely to view an ad. The company sells its data as a subscription, which it heavily discounts if a customer agrees to send back the data it collects to help build up Factual’s database.

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Factual’s pitch to customers is that it’s not Google and it promises never to build a consumer application that would compete with them. “Our customers are looking over their shoulders at Google,” Elbaz says.

He knows quite well of what he speaks. In 1999 Elbaz co-founded a company called Applied Semantics, which Google bought in 2003. It became AdSense, Google’s highly profitable ad network that funnels advertising revenue to countless web publishers. Elbaz sees Factual, which began its life 2008 but only now is revving up its sales effort, as the mobile equivalent to AdSense.

A soft-spoken engineer, Elbaz envisions Factual as a giant, neutral data provider to every company that needs it, similar to how one particular Silicon Valley icon provided databases to the entire corporate world. “I think we can be at least as large as Oracle,” says Elbaz.

That’s big ambition growing out of big data.