The digital downpour

Whatever the temptations, Sean Gourley is determined not to get trapped in the Silicon Valley bubble. Photo / Simon Baker

From Christchurch to Silicon Valley, a young Kiwi is at the forefront of a tech industry revolution, reports Karyn Scherer.

It was on long drives with his family from his home in Christchurch that a young Sean Gourley developed his enormous appetite for understanding how the world works.

His father amused the children with games of "20 questions", requiring them to figure out phenomena such as why the moon appears to change shape at different times of the month.

Years later, after abandoning law for physics at Canterbury University, Gourley got involved with the burgeoning field of nanotechnology. That led to Oxford University, where a Rhodes Scholarship helped him complete his PhD. And it was there, during a fancy dinner in one of its Harry Potter-style halls, that he just happened to sit next to the director of the CIA.

They argued about the likely outcome of the Iraq war. "I could see where he was coming from but ultimately I didn't have any way to refute it. It was at that point that I started to realise that maybe the skills I'd developed along the way of understanding the complexity of the physical world could also be applied to understanding the complexities of the social world."

That, in turn, led to seven years examining the mathematics of war, studying in minute detail patterns of conflict in Iraq, Afghanistan, Colombia and Sierra Leone. The result, to many people's surprise, was the discovery that people die in wars in a predictable way, regardless of their geographic, political or religious differences.

The paper made the cover of Nature magazine, and opened some interesting doors. As a result of his research Gourley has acted as a political adviser to the Iraqi Government, briefed senior US military officials at the Pentagon, and addressed the United Nations in Vienna. He has also worked at Nasa's Ames Research Center, a specialist intelligence company in London, and did a brief stint at the Boston Consulting Group in Chicago.

In his spare time he honed his skills as a decathlete and tried to improve his understanding of advanced string theory. But it gradually dawned on Gourley that if he was going to change the world, he needed to somehow acquire an awful lot of money.

"I back-of-the-enveloped it one night sitting at Oxford. I thought about $100 million should do it, and about 1000 people. Then you sort of scratch your head and say: 'That is all well and good but you're not going to get that from an academic grant and I don't really fancy working for the Pentagon to do that'. But it turns out there is one place in the world to get that kind of money, and it's a little place called San Francisco."

Which is a very roundabout way of explaining how he ended up two years ago working in Silicon Valley at the forefront of what management consultancy McKinsey describes as "the next frontier": a field known as "big data".

Gourley, who is now his early 30s, pitched his ideas to one of Silicon Valley's best-known venture capitalists, Peter Thiel. Thiel, who helped found PayPal and went on to fund Facebook - he was played by actor Wallace Langham in the movie The Social Network - immediately got it, so together with a pal from Oxford, Gourley founded a company called Quid.

Gourley sometimes struggles to explain to outsiders exactly what Quid does. But big data is basically a buzzword that describes the deluge of bits and bytes that now saturate our world thanks to the internet and its seemingly infinite memory.

A byproduct of the Too Much Information Age, big data describes the millions of digital files the world produces each day, and which are readily accessible online. The big achievement of big data companies is they have developed clever algorithms that are able to distil massive amounts of information into forms that can be much more easily understood by the human brain.

Many companies are still grappling with how they might use this extraordinary repository of information. So far, scientists, retailers and intelligence agencies seem to be leading the field, but the corporate sector is slowly catching on. There are also likely to be numerous consumer applications to help with everything from house-hunting to dating.

Gourley remains an idealist. "For the most part I hope people will see the benefits of this down the line through less conflict, less disease, more stable financial markets, and better use of technology," he muses during a quiet moment at Morgo, an annual conference for entrepreneurs which this year was held in Taupo. "It's the power of data and the power of models over the next decade that will take us down that path, and I think that's a whole lot better than a better movie recommendation."

Quid has so far raised US$14 million ($18 million) and already employs about 70 people, seven of them Kiwis, recruited mostly from Auckland University. It hopes to raise another US$30-$40 million next year and boost staff numbers to around 150, with the aim of eventually doubling that.

Gourley is keen to keep the ratio of Kiwis in the company at about one in 10, and is considering opening an office in New Zealand some time next year.

"I think there is something nice about the Kiwi way of doing things. It works pretty well in the start-up space. You get things done, no problem is too big, and it's just humble and away you go. It's a really nice culture and it fits us beautifully."

Quid's main competitor is Recorded Future, based in Boston, which has received funding from Google and from the CIA's venture arm, known as In-Q-Tel. Another rival, Palantir, also has close links with In-Q-Tel, and has also been backed by Thiel.

Palantir has been going much longer than Quid and is already valued at more than US$2 billion. Some believe it could be the next Google. Gourley is keen to stress it is a much different business, which grew out of software developed to detect financial fraud, and which now deals mostly in classified information for many of the world's governments.

"For us, we deal with open source information. They're two very different skillsets. One involves managing permission levels and storing data and whatnot, and the other is looking at everything outside of that and looking to give it to whoever wants it. I think the nice thing about that for me is you get to pick and choose whoever you want to give it to or sell it to, which I think is a much better place to be."

So far Quid has about eight major clients who are beta-testing its products, and it hopes to increase that markedly over the next year. The company is confident there will be plenty of big businesses willing to pay big bucks for information that will allow them to make much better strategic decisions.

According to Gourley, Quid has not yet decided whether it will sell its software to management consultancies, or simply "take them out of the game". It is also unclear whether its tools could eventually end up in the hands of any user who wants them, although that seems to be his preference at this stage.

"I could have stayed down in Christchurch with a surfboard on Sumner and had a pretty nice life teaching physics if I wanted. But I feel like I got a chance with the family I was brought up in and with the education I got, and with the supporters and investors I've had, to do something worthwhile."

He envisages an iPhone app, for example, which tracks the spread of global epidemics such as bird flu, and lets you know where it's spreading and whether all of your friends are okay. He is also keen to improve internet search techniques.

"I think search at the moment - the idea of typing in three words and getting a list of results back - is fundamentally broken. It's alright for getting a camera or a flight or something like that, but if you're wanting to go on Google and track something like the latest ideas about plastics and the ocean, it's hopeless."

In fact, Quid has already developed a consumer product that tracks the development of ideas, which it hopes to release before the end of the year. The software basically pulls together all the information available globally into something like an extremely complex 3D Venn diagram, which can be explored in as simple or as detailed manner as the user wants. The concept is based on how people interact with 3D games, and with Google Maps.

"I think that's a much more powerful way to interact with those ideas, because you get a global view; you get the temporal growth; and you can dive in and watch any one of the movies to go with it. You compare that to typing in a keyword and getting a list back, and that feels very primitive ... But no one has designed a network representation of ideas for consumers before, so we don't know if consumers really want to interact like that."

Like most entrepreneurs trying to establish a business, Gourley still lives like a student, and drives a 10-year-old car with a wing mirror attached with gaffer tape. While he isn't ruling out buying his own private plane one day, he is determined in the meantime to keep his feet on the ground - not always easy in Silicon Valley.

"Someone will say 'Hey, we're flying out to Vegas and the plane leaves in half an hour' and you realise it's their plane. Or the CEO of a large corporate comes, or you get invited to the Pentagon. That's something that can change you because it can become normal, and as soon as that stuff becomes normal, then you miss something."

Regular visits back home, and as much time as possible on his surfboard, help remind him of his turangawaewae.

"I think you only ever solve the problems you are confronted with, and if you remove yourself into a bubble then you lose your sense of what's important ... That's why I try to come back to New Zealand as much as possible, because ultimately wherever you are, whatever you've done, you're still a kid from Christchurch."