Sovereign Fund GIC Uses AI ‘Devil's Advocate' for Dealmaking
GIC on Thursday unveiled a video demonstration of its newest platform to highlight how AI is changing the way the Singapore state investor does deals. About an hour after uploading data and background materials on a proposed investment, the bot spits out a detailed summary of the key issues and examples of questions an investment committee member might ask before giving it a green light.
To truly prepare for pitching to human bosses, GIC staff can also switch to hard mode and 'Spar with an Agentic Devil's Advocate' - a live chat service named 'Ask Charlie' that will simulate conversations and ask curveball questions just as a real committee member might.
To build the in-house AI platform, which is meant for internal-use, GIC customized several large language models and input reams of its own data gleaned from four decades of dealmaking around the world.
'We've been around since 1981, so we've got 44 years of data,' said GIC Group Chief Investment Officer Bryan Yeo. 'The data that we have across different asset classes, across different regions through our investments and through our deals actually is the competitive edge we have.'
GIC is part of a growing cohort of investment firms racing to use AI to transform their operations and enhance returns. Companies including General Atlantic and Blackstone Inc. have touted their developments, while trying to back startups that could one day outshine Alphabet Inc. and Meta Platforms Inc.
And while GIC's AI demonstration could be brushed off as never-to-be-used vaporware if shown by a Silicon Valley startup, few can match the heft and access of the fund - an investment giant estimated by consulting firm Global SWF to manage $847 billion in assets.
Read: Singapore's Cautious Wealth Fund Takes More Private Markets Risk
Even the fake deal used in the demo, codenamed 'Project Blue Sky,' was a quiet flex of GIC's size. In a $50 billion privatization for an unnamed aeronautical company, $30 billion would come from GIC and its co-investors plus $20 billion in loans, with a planned exit within seven years. That's not a stretch for a fund that was part of a rejigged €6.7 billion ($7.8 billion) deal last week, and helped close a $14 billion take-private transaction for Store Capital Corp. in 2023.
The firm's internal teams are using the large language models - Yeo declined to say which - to develop agentic personas to populate the virtual investment committee. Three examples included a risk manager, a contrarian investor and an optimistic investor. Agentic AI systems can operate independently, with less human supervision than generative AI.
Deal teams are already using the service, which is currently restricted to asking questions rather than passing final judgment on any deal. But chatbots serving up tough questions have already proven popular with GIC's top leaders.
Chief Executive Officer Lim Chow Kiat said the most interesting interactions he's had with the AI agents come from asking them to pose questions that stimulate his thinking. He also repeats the same questions multiple times to see how the responses vary, to better understand their reasoning process.
'We have a separate kind of research tool, which we call Research Assistant, and I use it as a colleague that you can have a back and forth with,' he said.
In addition, GIC has been buying stakes in external AI companies, especially in the US.
'Trends like AI benefit the US the most,' because they have so many companies that are able to leverage it, said Lim.
GIC is investing in three types of AI firms: enablers that build infrastructure for the sector; monetizers that create and sell AI-infused products and services, often in the form of startups; and adopters which are using AI to improve efficiency in their core business.
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