Hebbia AI - Detailed Review

What is Hebbia AI and what does it do?

Hebbia AI is a company that offers an AI-powered productivity tool called Matrix. This tool allows users to build AI agents that complete end-to-end tasks, such as analyzing large volumes of unstructured data across multiple document types. It ingests data from various formats, retrieves information when prompted, and delivers answers with citations in a spreadsheet-like format.

Who founded Hebbia and when?

Hebbia was founded in 2020 by George Sivulka, who initially created a neural information retrieval model to help former Stanford students working at Morgan Stanley analyze complex documents. Sivulka dropped out of his PhD program in computational neuroscience at Stanford to pursue the company full-time.

What is the main product of Hebbia, and how does it work?

The main product of Hebbia is Matrix. Matrix allows users to analyze large volumes of unstructured data by ingesting documents in various formats (such as PDFs, slides, and spreadsheets), and then retrieving and synthesizing answers to complex questions. It uses a “data-grid” or spreadsheet-style interface, which makes it easier to work with large language models (LLMs). Matrix can automatically route queries to appropriate models, decompose queries into tasks, and perform chains of actions or analyses on behalf of users.

Who are the primary users of Hebbia’s products?

Hebbia’s products are primarily used by financial services firms, particularly private equity analysts performing due diligence. The company has strong penetration in this sector, with 33% of the top global asset managers by assets under management (AUM) as customers. Other clients include private equity firms like American Industrial Partners, Oak Hill Advisors, and Charlesbank, as well as strategic firms like Centerview Partners and government agencies such as the US Air Force.

How is Hebbia priced, and what are the costs associated with it?

Hebbia operates on a subscription-based model, with pricing comparable to annual Bloomberg Terminal subscriptions. The cost is typically around $15,000 per seat annually, although some firms have negotiated rates as low as $3,000 per seat. This pricing positions Hebbia in the premium enterprise software category.

What are the key features of Hebbia’s Matrix product?

Key features of Hebbia’s Matrix include the ability to index any document type via portal or API, intelligent semantic search, automatic extraction of answers or metadata, table extraction features, custom alerts, and semantic-based document comparison. It also offers end-to-end encryption and seamless integrations with various enterprise systems and data sources.

How does Hebbia differentiate itself from competitors?

Hebbia differentiates itself through its unique “data-grid” interface, which is more natural for working with LLMs compared to traditional chat UIs. It also emphasizes transparency by showing the sourcing and individual steps taken to reach conclusions. Additionally, Hebbia’s focus on financial services and its ability to handle complex, high-stakes decision-making tasks set it apart from broader enterprise search solutions.

What are the growth and valuation metrics for Hebbia?

As of June 2024, Hebbia has achieved $13 million in annual recurring revenue (ARR), representing a 15x growth over the previous 18 months. The company was valued at $700 million during its Series B funding round in July 2024, led by Andreessen Horowitz. Hebbia has raised a total of $161.1 million across four funding rounds.

What are some of the risks and challenges facing Hebbia?

Hebbia faces several risks, including the vulnerability of pilot revenue, as much of its current revenue may represent pilot contracts rather than committed long-term usage. There is also the risk of commoditization of its core technology as large language models and enterprise-ready AI services from cloud providers advance. Additionally, there is a risk of product-market misalignment if the product’s sophisticated features do not meet actual user needs.

How does Hebbia plan to expand its market and offerings?

Hebbia plans to expand into adjacent markets such as enterprise knowledge management, workflow automation, and intelligent workplace assistants. The company aims to leverage its data advantage to build an end-to-end platform for enterprise knowledge work, including features like meeting summarization, email management, and automated workflow creation.

What kind of security and permissions management does Hebbia offer?

Hebbia emphasizes strong security and permissions management. The platform offers end-to-end encryption and integrates seamlessly with enterprise systems, providing sophisticated permissions management. This ensures that sensitive information is protected and accessible only to authorized users.