Palantir is one of Silicon Valley’s most exciting and most secretive startups emerging out of the digital transformation. The company, founded by Peter Thiel, arose out of an effort to use data to look combat credit card fraud at PayPal.
Motivated by the terrorist attacks of 9/11, Thiel founded Palantir as a “mission driven company” focused on using data to “reduce terrorism while preserving civil liberties”. The company was launched into prominence by a $2MM investment from In-Q-Tel, the CIA’s venture capital arm, where investors noted “The most impressive thing about the team was how focused they were on the problem … how humans would talk with data.” (3)
The business model at Palantir involves providing software to aggregate and manage diverse data sets and to organize the information in an intuitive way that enables customers to “ask better questions and make better decisions” in any domain of complex problem solving (2).
In the early days, they worked almost exclusively with government agencies to stop fraud, find terrorists, and aid in military missions. The Palantir team executed on their mission to do good in the world through cooperation with the US military during the wars in the middle east. They are famous for predicting roadside bombs to highlight safe paths through the streets in Baghdad, analyzing artillery fragments, location data and social media posts to locate bomb makers, and are even rumored to have been involved in locating Osama Bin Laden. (1)
However, their operating model, combined with motives for growth and profitability have recently created conflict between their business model and operating model.
Palantir delivers on their business model by selling perpetual licenses to their analytics software along with support services. When Palantir sells their software, engineers deploy to the client site to help organize, tag, and integrate data and build custom user interfaces to enable problem solving. Then they leave the product with their client for ongoing use. As the company grows, and control of clients and uses decentralizes, maintaining their ethical standards becomes more complicated.
An example of this conflict, came to light when Palantir engaged with the Northern California Regional Intelligence Center (NCRIC), a federal intelligence unit established after 9/11 to fight domestic terrorism. The NCRIC uses Palantir software to, among other things, aggregate license plate photos automatically captured by local police cars and traffic cameras. Proponents of the program boast that the software can review the database of 500 million license plate photos in a matter of seconds. They point to an example where a child abductor was located and arrested within one hour of the child disappearing. Detractors decry the program as an example of government overreach and a violation of privacy. One such detractor, Michael Katz-Lacabe, filed a freedom of information act request on his two license plates and the police department sent him 112 photos that had been captured by these cameras. He reflected that with this technology, the government can “wind back the clock and see where everyone is.” Should we worry, that in the wrong hands, this technology could be used for government discrimination, political or criminal purposes?
Palantir recognizes that its ability to continue exist and attract customers is tied to its ability to protect data privacy and security and highlights two specific commitments in this area:
- Software is designed with privacy and civil liberties capability baked in rather than added on as an afterthought (2)
- Palantir Council of Advisors on Privacy and Civil Liberties is a group of advocates and policy experts who help Palantir address concerns and push for legislation that will protect Privacy and Civil Liberties (2)
The line between privacy and security can be blurry and many people are worried about Palantir’s ability to walk that line (3). The pressure on Palantir to deliver shareholder returns is growing and will push the company to loosen their ethical standards and compromise their ability to walk away from work that does not align with their mission.
To take their commitment one step further, I would like to see Palantir create an independent (non-owner) oversight board with rotating elected membership, which holds veto power over all projects and uses of the software that do not align with the mission. Such a board, while complicated to architect, may be the best chance we have, of preventing the destruction of privacy and the sinister use of Palantir’s incredible power.