Monitor110 mines blogs for investment intelligence

September 21st, 2006

stock tickerMonitor110 is a NYC startup planning to launch a system early next year that will allow institutional investors to monitor “chatter” about the market on the Web. A differentiator is offering information that is available before the “historic point of investor visibility”. The graphic on their splash page lists the sources, from earliest on, as “joe bloggers”, employees’ personal blogs, expert blogs, journalists’ personal blogs, drug trial participants’ discussion boards, special interest sites, corporate sites, “top blogs” and regulatory sites. Do you see a trend in this list?

There is not much in depth information on the site, but they do mention using many relevant technologies, including data mining, text classification, machine learning, natural language processing, sentiment detection and reputation modeling. Of course, it’s very easy to talk about all of these advanced technologies and moderately easy to use most of them in trivial ways. It will be a challenge to find the right way to use these to make a real difference. But, mining the Blogosphere for intelligence is a hot topic and doing it for investments seems like a very natural domain. It might just work.

But what about spam and other attempts to game the system? Here’s where their approach to reputation will be key. False stock tips is a common spam genre that is known to work. The success of systems like Monitor110 might lead to their own demise as spammers quickly adapt to it, creating and populating blogs that provide false signals and information. Detecting these bad sources, and doing it quickly, will be difficult.

Monitor110 announced a $5M Series B round of financing earlier this month. See this Financial Times article for more information.