Dataminr in the News

A passerby notices a fire at a refinery in Louisiana and tweets a picture. Eleven minutes before the news hits the wires, a tech startup called Dataminr fires off an alert to subscribers in the finance industry, who trade ahead of the news.

One client is known to have made legendary amounts of money trading on two alerts—one about the Boston Marathon bombing and another indicating that an AP tweet of a bombing at the White House, which had sent the market tumbling, was a hoax. Many of Mr. Bailey’s clients say his service pays for itself in a single trade. And, yes, it’s easy to see how a tweet that alerts a trader to an event that shortly will cause a big market move could be almost infinitely valuable.

Dataminr is dependent on its deal with Twitter providing live access to the Twitter “fire hose” of tweets going back to when Twitter’s service started.  Mr. Bailey admits to hearing from people who say of Dataminr, “What a great idea. What a great company, but if Twitter dies, who cares?”

“Twitter is not going to die,” he says. Dataminr is daily evidence of the value hidden in its data stream, a value not appreciated in the Facebook-style user-engagement metrics that Wall Street applies to the company.  “What makes Twitter Twitter that other data sets aren’t?” he asks. The ability to “surface unknown unknowns”—to bring to light new and unpredicted facts about the world, tapping users’ willingness to serve as on-the-ground “sensors” for breaking events.

Dataminr is already a success. The company’s clients represent more than $500 billion of assets under management. But its business model suggests almost infinite possibilities.