3 Comments

Summary:

Mu Sigma has closed a $108 million investment round to expand its analytics-outsourcing business. Mu Sigma takes customers’ data and it turns it into business insights, meaning customers don’t have to built their own in-house big data expertise. It’s an already-profitable business that’s only getting bigger.

delivery-framework

Chicago-based big data firm Mu Sigma has closed a $108 million private-equity investment round to expand its analytics-outsourcing business. Armed with a team of data scientists and subject-matter experts, Mu Sigma takes customers’ data and it turns it into business insights, meaning customers don’t have to built their own in-house big data expertise. It’s an already-profitable business that will only get bigger.

The engineering, programming and math skills necessary to do big data analytics are in hot demand but short supply, which is what makes companies like Mu Sigma so appealing. All customers have to do is bring their data and their money, and the analytics experts go to work figuring out the best strategies for getting insights, and then run the big data workloads. Whereas using cloud-based resources eliminates the capital expense of big data projects, outsourcing eliminates the human resources expense, too.

It’s a fine business to be in. Mu Sigma’s funding comes on the heels of Opera Solutions’ $84 million equity investment in September for its similarly positioned service. Both companies claim to be profitable already, and Opera actually is doing more than $100 million a year in revenue. Both also claim dozens of Fortune 500 customers.

But you have to have the right personnel. Mu Sigma Founder and CEO Dhiraj Rajaram told me recently that the ideal employees possess a mix of technology and business skills that enable them to apply their advanced math skills in real-world scenarios. With data-analysis techniques and computer science methods advancing so quickly, Rajaram said, it’s tough for companies not deeply connected with the academic community to keep up.

That’s why they turn to companies like Mu Sigma. Not only does it hire the cream of the crop, but it also trains them via its Mu Sigma University program to keep their skills up to date. Rajaram says the company has grown to more than 1,000 employees and should nearly double by the middle of 2012. As of September, the aforementioned Opera Solutions, employed about 150 workers with Ph.D.s or equivalent degrees.

General Atlantic led this equity-financing round for Mu Sigma, along with existing investor Sequoia Capital.

  1. With the current shortage of Big Data/Analytics talent, the outsourcing approach may be appealing to mid/large enterprise clients. Especially if Mu Sigma figures out how to bring the analytical workloads on premises to remove the need to migrate large, internal data sets.

    Share
    1. they have figured that out … they use terminal emulation using citrix to enter the firewalls … think of them as Indians with long hands

      Share
  2. Great idea, just wait for the amazing practical insight an offshore data center brings. Academic attempts to impose models on reality w/techniques management teams do not understand or trust. Smart effort to arbitrage human capital but ultimately issues like corporate culture, understanding and trust of underlying methodologies etc, are not properly addressed by this model. Simply buy an out of the box data mining solution like “Autobox”. The techniques/quant expertise are a commodity.

    Share

Comments have been disabled for this post