Alternative asset manager bets AI will play a big role in investing over the next decade.
Montréal-based investment giant Sagard Holdings has appointed its first head of artificial intelligence (AI), hiring Parinaz Sobhani to bolster its in-house expertise in an area it believes will play a key role for the firm over the coming years.
Sobhani has spent the past 15 years focusing on AI in academic and industry roles. With a PhD from the University of Ottawa specializing in natural language processing, Sobhani has helped develop end-to-end neural machine translation models at Microsoft alongside time working at other research labs.
For the last seven-and-a-half years, Sobhani has worked at Georgian, a growth-stage business-to-business software investor, where she most recently served as the Toronto-based firm’s head of AI.
“Computers and humans are finally speaking the same language.”
Parinaz Sobhani
During her time at Georgian, where she was one of the company’s first AI hires, Sobhani built and led the firm’s AI team and practice, vetting potential AI investments and supporting the adoption of AI across Georgian and its over 50 portfolio companies. With Sagard, Sobhani has been tasked with doing the same work on a larger platform.
Sobhani left Georgian earlier this month and is set to join Sagard as its head of AI on September 9. “I’m ready for a new challenge,” Sobhani told BetaKit in an interview. “I’m ready for building again.”
She expressed excitement about the opportunity to oversee AI efforts across a bigger Sagard ecosystem covering verticals ranging from healthtech to FinTech and climate tech. Sobhani claimed her role at Sagard offers the potential to deliver an even greater impact.
Power Corporation of Canada-owned Sagard, which has over 150 portfolio investments and $25 billion in assets under management, is a global alternative asset management firm spanning venture capital (VC) through Portage Ventures and Diagram Ventures, as well as private equity, private credit, and real estate.
Francois Lafortune, managing partner at Sagard and co-founder and CEO of Diagram Ventures, led the search for Sagard’s first head of AI. He believes that Sobhani will give Sagard “a huge step up” in its ability to support its portfolio companies as they adopt AI, as well as how the firm evaluates prospective investments and deploys the tech internally.
“[Sobhani] is not only credible from an academic standpoint—and has published and is well-regarded in the AI circle—but she’s a practitioner who has done something similar in the world of venture … She’s seen what works, what doesn’t work, and I think she can bring a lot of that expertise to Sagard.”
To date, Lafortune said that Sagard has leaned on its existing investment team, “pockets” of internal expertise, and outside advisors to help guide its AI decision-making. “The part-time version of this across multiple people was just not as scalable, and, frankly, did not do justice to how big we think this [AI] trend is in the world of investing over the next decade.”
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Sagard is not alone in identifying a need for a dedicated AI leader: a variety of large companies have recently added new AI executive roles with titles like head of AI and chief AI officer.
As the broader tech market has cooled during the macroeconomic downturn, and many other startups and fund managers have faced difficulties fundraising, AI has remained hot. These conditions have benefitted Canadian companies ranging from AI-focused VC Radical Ventures to startups like video-creation startup Viggle, image-generator Ideogram, video-game behaviour engine provider Artificial Agency, and large-language model developer Cohere.
With the progress that has taken place over the past two years, Sobhani said, “Computers and humans are finally speaking the same language,” arguing that, “The opportunity is immense.”
But since the AI funding frenzy began after OpenAI’s unveiled ChatGPT in 2022, some investors have become wary of AI and how much companies have been spending on it, while ChatGPT’s growth has flatlined. In June, Thomson Reuters chief product officer David Wong told BetaKit that “The reality check is happening now” as buyers have become more discerning and started coming to terms with where AI is working and where it is not.
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Sobhani acknowledged that successful AI adoption requires time, patience, and careful thought about what ingredients are being used and what problems you are trying to solve, as well as customer validation and education. “It’s not going to happen overnight,” she said, noting that data quality, differentiation, and privacy also remain challenges.
“I’ve been part of a few of those hype cycles, and they all have something in common: setting the wrong expectations, or solving the wrong problems, or not having enough patience to build the right infrastructure,” Sobhani said.
Lafortune expressed his belief that the next generation of tech champions will have AI at their core. He expects Sobhani to play an important role in helping Sagard refine its AI investment thesis and conduct due diligence to distinguish real progress from empty hype.
Lafortune expressed his belief that the next generation of tech champions will have AI at their core.
So far, Sobhani has seen AI have a big impact on applications like content generation, information extraction, research, data analysis, customer support, and as a tool for developers. In areas where risk is lower because AI is augmenting the work done by a person, Sobhani said companies have already seen some success, something others have also told BetaKit.
Businesses developing fully automated solutions, however, need to be more cautious, Sobhani argued, given that the risk of letting AI run amok without any human supervision is greater. She said she has seen companies in highly regulated industries exercise more caution.
For her part, Sobhani highlighted that some demographics have been underrepresented in past tech waves, and hopes to play a part in ensuring that is not the case with this latest AI boom.
“Especially for women [and] women of colour, I think this is a very critical moment to make sure they are part of this new wave of transformation … I’m very excited that I can be at least one voice [here],” Sobhani said.
Feature image courtesy Sagard Holdings.