This story appears in the September 2, 2013 issue of Forbes.
Palantir lives the realities of its customers: the NSA, the FBI and the CIA–an early investor through its In-Q-Tel venture fund–along with an alphabet soup of other U.S. counterterrorism and military agencies. In the last five years Palantir has become the go-to company for mining massive data sets for intelligence and law enforcement applications, with a slick software interface and coders who parachute into clients’ headquarters to customize its programs. Palantir turns messy swamps of information into intuitively visualized maps, histograms and link charts. Give its so-called “forward-deployed engineers” a few days to crawl, tag and integrate every scrap of a customer’s data, and Palantir can elucidate problems as disparate as terrorism, disaster response and human trafficking.
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That mission turned out to be vastly more difficult than any of the founders had imagined. PayPal had started with perfectly structured and organized information for its fraud analysis. Intelligence customers, by contrast, had mismatched collections of e-mails, recordings and spreadsheets.
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And now Palantir is emerging from the shadow world of spies and special ops to take corporate America by storm. The same tools that can predict ambushes in Iraq are helping pharmaceutical firms analyze drug data. According to a former JPMorgan Chase staffer, they’ve saved the firm hundreds of millions of dollars by addressing issues from cyberfraud to distressed mortgages. A Palantir user at a bank can, in seconds, see connections between a Nigerian Internet protocol address, a proxy server somewhere within the U.S. and payments flowing out from a hijacked home equity line of credit, just as military customers piece together fingerprints on artillery shell fragments, location data, anonymous tips and social media to track down Afghani bombmakers.
Phi Beta Iota: One third utter bullshit, one third “reasonably uniformed” hype, and one third grain of possibility. What Palantir will not tell you is that there are enormous obstacles — and attendant expense — to all forms of data conversion; that they really have not got a secret sause; and the 90% of what you need to know is not digital, not in English, and not known to anyone remotely connected to a Palantir software program.