CYQIQ is a tech startup that uses generative AI to speed up the data discovery process and targets the consulting and finance industry. Based on natural language processing, more specifically on large language models, CYQIQ works with unstructured data to make it accessible for knowledge workers. In the consulting and finance industry, clients often provide large amounts of documents and data. Going through, connecting, and understanding all the information takes time and can be messy. This is where CYQIQ comes in, using generative AI to sift through all these documents and can then, e.g., fill standardized frameworks such as a Commercial Due Diligence checklists, the SWOT analysis and makes the documents searchable. CYQIQ is currently partnering with numerous small and medium-sized consultancies in the USA to automate their workflows using generative AI. The company name CYQIQ is pronounced like “psychic”. Seeing the connections in documents and structuring them is the idea of the startup, and the metaphor behind the name is that CYQIQ sees the connections before users do. As an AI company, the name was also AI-generated.
From St.Gallen to Silicon Valley
Originally from Hungary, Richárd Hruby came to HSG for his studies in 2017. After completing a bachelor in business administration and a certificate in data science fundamentals, he now pursues a double degree with a masters degree in Banking and Finance from the University of St.Gallen and entrepreneurship from HEC Paris. So how does one go from a business background to becoming the founder and CTO of an AI startup? Although you learn most technical skills on the job anyways, making the lack of a computer science degree less problematic, Richárd worked in tech beforehand. Internships in data science consulting and directly at Google Dublin proved helpful, as well as joining START Global. According to Richárd, this broad scope of experience allowed him to start CYQIQ. Moreover, he explains that, as startup founders must do everything, from management to technology. The most helpful learnings from his studies and internships were working in a structured manner, having knowledge of agile project management and leadership, and working in international teams.
Richárd has been in Berkeley, California, since January of this year. Together with Nuno Teixeira from Portugal and Tino Purmann from Switzerland, he founded CYQIQ this year as part of his double degree masters program X-HEC Entrepreneurs, which includes a stay abroad at the University of California Berkeley. Tino is also an HSG alumnus. The two of them met in 2017 and have wanted to found a company together since 2018. After his bachelor, Tino already founded EQL Finance, a fintech platform in the USA that provides interest-free loans to individuals earning less than 30’000 USD per year. The startup went through the Techstars accelerator and raised 2.1 million USD in venture funding. Nuno met Richárd in Paris through the double degree program. With an his entrepreneurial experience in launching multiple retail businesses, as well as marketing and business development background in large Parisian beauty conglomerates, Nuno completes the founding trio.
According to Richárd, he and Tino come from similar backgrounds and are prone to agree quickly, while Nuno tends to challenge them, creating an overall reflexive dynamic. The CYQIQ team has recently grown, with two interns from Berkley and India supporting the international team.
CYQIQ’s North Star: Setting an ambitious goal
The three co-founders already had the idea for CYQIQ in November 2022. The co-founders already had experienced the problem of having to deal with large amounts of unstructured data manually and wanted to tackle this issue. Next, they asked themselves where they could generate the most significant impact. They already knew much about the consulting and finance industry as they are all from a business background. They knew that it is valuable to save time in these industries as an hour of a consultant’s work time is quite expensive, so they decided to target these two industries specifically.
The public has become increasingly familiar with Chat GPT in recent months, an AI tool that can converse in a human style. Chat GPT’s underlying architecture belongs to large language models (often abbreviated LLMs) that process and produce texts through a neural network. Trained on vast amounts of data, their output has been vastly successful at rethinking the capacity of machine learning and the way users interact with computers. In our interview, Richárd acknowledged that LLMs are currently attracting massive investments and appear as the new direction of the tech industry at large, even conceding that too much money is thrown at it. Thus, now is the time to join what could be a decisive shift, just as the internet in the 1990s or the democratization of smartphones. CYQIQ hopes to apply LLMs on unstructured data sets, offering valuable time gains for its users.
Since February, the team has started to work on CYQIQ full-time. As they knew they were in Berkeley on their university program until April 2023, they looked at what they could achieve in three months. One of their goals was to get accepted into a US startup accelerator program like Y Combinator or SkyDeck. From this end goal, their North Star metric, they engineered their actions backward, looking at the requirements needed to get into an accelerator and deriving concrete steps from it. Setting this ambitious goal and committing to it was one of the critical learnings that got the startup that far.
Getting into SkyDeck and future milestones
Initially only with a pitch deck and an idea, the team submitted their initial application to SkyDeck mid-February, but had a far more concrete plan and two onboarded pilot customers by the time of their last interview just a month after, winning the acceptance into the accelerator. SkyDeck offers a six-month program for startups that consists of three parts. In the first six weeks, founders attend workshops on entrepreneurship. Then, there is a testing phase for the startups, followed by a fundraising period where they are introduced to a large pool of investors. SkyDeck is linked to the University of California Berkeley. That means that SkyDeck employees are also employees of the university, but the fund that handles the investments is a private fund by limited partners. SkyDeck chooses another batch of 20 to 25 startups every six months to accelerate them. They invest 200’000 USD at a 7.5% stake, leaving startups with a 2.66 million USD valuation. Richárd explained that SkyDeck has helped CYQIQ to build a network in Silicon Valley, as the team did not have prior connections in the area. This type of private-public partnership is to be expected more in the US than in Europe.
For now, the team plans on growing the startup. Until August and September, they are planning to achieve some traction to show potential investors and build product stickiness. In fall 2023, they hope to raise a first round of institutional funding, also referred to as seed funding. Afterward, they plan on hiring more employees and scaling the startup. To exit, they hope to get acquired at some point. As for Richárd himself, he plans to stay in the San Francisco Bay Area for the next couple of years. He states that he prospers in the Bay and enjoys the vibrant startup and tech ecosystem and the people he is surrounded by in Silicon Valley.
Fail quickly: Silicon Valley’s startup culture
Silicon Valley is a well-known hotspot for AI, software, and technology startups. In our interview Richárd made clear that his experience showed him that the risk appetite in Silicon Valley is not comparable to Europe. Furthermore, the perception of failure is different. In Silicon Valley, failure is rather perceived as a chance to try something new and as an opportunity for redirection. Most importantly, Richárd learned to “fail quickly”. When building CYQIQ’s first prototype, which they built in just two days, they got in touch with two consulting firms from Canada and Switzerland. The consulting firms tested the prototype and gave feedback. This early user feedback and data helped CYQIQ validate its prototype and idea early on and improve quickly. This experience was valuable to the team, and Richárd advises future founders to launch quickly. This includes testing prototypes with early users quickly, putting out LinkedIn posts, and applying to accelerators and other startup programs quickly.
Richárd’s advice for HSG students: “Do it!”
To conclude, Richárd offers advice to HSG students interested in founding a startup themselves. First, he recommends surrounding yourself with top-notch people in the area you want to work in, finding mentors to bounce off ideas and brainstorm, and leveraging, e.g., the HSG alumni community. Second, he advises students to “do it!”. For Richárd, it was valuable to step out of his comfort zone. He experienced a steep learning curve building a startup first-hand. Founding a startup is a stretch in every zone and very stressful, but it also helps you grow as a person immensely.