Reflections on Palantir

Can someone explain to me what is the Palantir's business model ? I haven't heard any large, meaningful project they been involved in, but I keep hearing the company name & how hot they are and their stocks are going to blow-up any day (some of my friends kept their stocks for the last 4-5 years with very little gain compared to other software companies). I know of the smaller software companies that are less than 100 people and have a very meaningful impact in DoD & Gov space.

They basically have two. Just like e.g. Amazon has both retail and cloud infra as separate, independent business models.

One is described well in the article, originally aimed at commercial clients. The article isn't short but we're on HN, not Reddit, so we should read the articles. Parts 2 and 3 describe it. The linked note at the end of 3 is very relevant.

The other one is the gov one, which is also mentioned as "Palantir has prevented terrorist attacks".

The article actually links to lots of product docs. It isn't secretive, plenty of videos on Youtube demoing the software. The docs are public, which is more open than can be said for 90% of software in their price range.

When I interned at Palantir (summer 2014) their business was mostly in data ingestion, visualization, and correlation.

A typical workflow for a Palantir customer was that Palantir would come in and dump a ton of data out of old crufty databases and into Palantir's datastore. Then, they'd establish connections between that data. This is all sounds kind of hand-wavy, but the gist of it is that a lot of government agencies have data that lives in separate databases and they can't easily correlate data between those two databases. Once the data was in Palantir's system, they could do queries against all their data, and make connections and correlations that they wouldn't otherwise be able to find when the data was previously siloed.

One of the sample use cases was identifying people filling prescriptions for schedule II drugs multiple times on the same day, and correlating that with pharmacies run by people connected to known drug traffickers. Previously, this was hard to do because the database of prescription purchases was disconnected from the database of drug convictions.

So it’s hygiene and structure

That, and a really powerful visualization suite. In the example I gave above, you could plot the prescription purchases on a map and see that people were driving along the highway and hitting up pharmacies along the interstate. Better yet, you could drop into Google Street view in front of one of the pharmacies, and look at it from the street level and see that it doesn't even have signage indicating it's a pharmacy.

IIRC part of it is that the software itself can make connections between separate data sets. You're not just ingesting data about purchasing information and drug convictions and so on, you're getting automatic relationship detection. For example, figuring out that the cust_ss_num field in one dataset correlates to the conv_ssn_full field in another dataset, and knowing that those fields are the "SSN" field from a third dataset, and being able to automatically give you a view where those three datasets are correlated. This saves people having to go through every data set and manually map each field to each other equivalent field in each other related dataset.

I could be mistaken, but I think this is how it was explained to me originally.

That makes sense and sounds really useful

They have a few brand new products that are quite compelling.

Warp Speed: Aims to integrate ERP, MES, PLM, and factory floor systems into a single AI-driven platform. As opposed to legacy ERP systems, it focuses on production optimization rather than just financial tracking. Warp Speed has the potential to relegate legacy systems to backend data storage, shifting the entire intelligence layer (and value) to Palantir's system. Warp Speed targets both innovative new manufacturers (they note Tesla and Space X alums starting new companies) and traditional large-scale operations.

Mission Manager: enables other defense contractors to build on Palantir's platform and benefit from their security infrastructure and position of trust within government. You can think of it as an AWS for defense companies; plug and play with the foundations handled for you. While the product just launched in Q4 2023, they just received a new $33 million CDAO Open DAGIR contract. While this is possibly just an advanced POC, it represents significant potential for future growth and wider adoption in the defense sector. Now is the perfect time. From 2021 to 2023, VC firms invested nearly $100 billion in defense tech startup companies, a 40% increase from the previous seven years combined. Time is the most important thing for these startups and Mission Manager shows the potential to save lots of it.

> Now is the perfect time

The perfect time is yesterday. All defense companies already went way up.

Palantir... Not so much

The stock is up 152% YTD. I think they went up?

In many of the enterprise orgs I've worked in, the two tech teams that are chronically understaffed are 1) info sec, 2) DBA/ data architecture/ data science. I'm lumping those 3 together on purpose, because they're always understaffed and typically not empowered to build anything.

So if they are dumping data out of old crufty databases and into Palantir's datastore, which one is the active database going forward? In 2024.

You're right to group Data teams together. They seem to share a common plight.

In my experience, internal employees outside Data have a funny relationship with Data. They hate to manage it but they love to blame it, especially in analytical / decision-making scenarios. Teams that "own" the data usually get the blame, on top of having to deal with a mass of rotting pipes and noncompliant teams, while also losing out on credit when non-Data teams report big wins.

Based on what the GP says, it sounds like Palantir knows how to exploit common internal politics around Data. They build up technical & social expertise in ETL'ing disparate data sources, and they can avoid blame by being hired by executives as an external third party.

The stock has blown up. It has more than doubled for me. Almost tripled.

It’s quite expensive now.

I would encourage you to do your own research.

For some reason, HN has very little depth in stock market understanding. HN passed on META at $100.

I know there are some very knowledgeable people here. Wish there was a way to create a “subreddit “ here without all the Reddit noise.

…particularly to German chancellors in the 1930s.

It all comes down to if you have the right sales people that can land large govt contracts. The rest is figuring it out as you go. This is an incredible moat for them. Whoever gets these large govt contracts first in their space wins.

People dismiss this type of work as no big deal, but in my experience this is the actual hard work of producing something useful for companies, and what 90% of SaaS resellers will never be able to deliver on.

I use Foundry for work. It makes data ingestion, cleaning, quality check and automation easy. After all the data is ingested, running analysis/RAG on them become extremely easy.

Basically, it's end-to-end data engineering and analytics. And the more a company uses/invests into the platform, the more benefit and locked-in they are.

RAG?

"End-to-end data engineering and analytics" is quite a bold claim from a single service provider.

Here is the link for anyone interested: https://www.palantir.com/platforms/foundry/ and a YouTube explainer: https://www.youtube.com/watch?v=ZGGRCTTjLfQ

Given you've used it, just how self-service is it? To me this seems like such a large claim that - if it's doable - I'm surprised there are not more competitors in the "vertically integrated data providers" space.

Yes, it is very hard. But does Palantir succeed? Or do they like some other companies just trick customers with big wallets to buy?

Retrieval Augmented Generation.

https://en.wikipedia.org/wiki/Retrieval-augmented_generation

Basically, using your actual data/documents to supplement a general purpose LLM and generate better answers for your specific use case.

If you were buying in the $6s, it nearly 7x'ed in like a year

I used it quite a bit early on during military operations. The ability to see the timing component was key; not only would you plot the purchase locations, but you could play the timeframe of records, work out the timing so you knew the order in which they visited the locations, where they must have stopped for gas along the route. In a classic workflow, you'd then investigate the gas stations, attach them to the event with confidence intervals, pull CCTV footage, see if you can get a payment receipt, and enter all of that data back into palantir. A few days of doing this, and you can build up all a map of every aspect of the drug run; the who what when where and why. It's a fantastic organization system.

> Can someone explain to me what is the Palantir's business model

AFAICT, it is government & government-adjacent contracting using techniques borrowed from big tech and WITCH, since big tech won't directly court government sw contracts, and WITCH may fail at getting clearances for foreign-based personnel.

To me it seems they do https://logicmag.io/commons/enter-the-dragnet/

WITCH?

your own private digital cia, for hire to the highest bidder.

Building a panopticon is always justified as a way to fight crime and then becomes a way to control the population. Tracking women getting Plan B, tracking people buying birth control, etc.

WITCH!!

I was curious too; here's an HN link spelling it out and discussing in context of working there:

https://news.ycombinator.com/item?id=27571707

Wipro, Infosys, TCS, Cognizant, and HCL. i.e. "large tech consulting companies" if you're feeling generous, "body shops" if you're not.

One of the reasons I still frequent this forum is to countertrade the espoused opinions. Meta@100 was such an easy buy, Everyone was talking as if they were going out of business because they did not like the idea of the metaverse. A quick look at their earnings said that was utter nonsesnse. So bizarre to see all jounalists and many users here to attribute the turn around to them pivoting to AI when that was not at all what the CEO was saying during that time. Always look for primary sources, opinions are funny.

> Given you've used it, just how self-service is it? To me this seems like such a large claim that - if it's doable - I'm surprised there are not more competitors in the "vertically integrated data providers" space.

It is both very self service and not very self service. That's why they employ the FDE model from the article, to actually ingrain it into the client company to the point that it becomes self service.

It's extremely hard to build such a product from scratch and have it actually be good, that's why there's no competitors. Especially providing the finely grained security controls that the article talks about, and have the platform be secure. There's a reason their security team wins the biggest CTFs half the time.

I appreciate the technical achievements here. However, I wonder how long before it’s standard practice to track all peoples movement, not just those suspected of a crime. I know of at least one YouTube channel that is always recording all traffic camera streams in Washington so there must be some State entities doing the same. Back in 2020 there was a twitch channel that would play a 9x9 grid of all the livestream footage from the George Floyd protests. I’m sure an archive of that exists somewhere on a LE server.

We used them at a bulge bracket investment bank and they failed miserably...

HN has always lacked economic and stock market knowledge and instincts generally speaking. Most comments tend to say it’s rigged, evil capitalist, etc. Guessing because hackers generally tend to swing far left and socialist though weird as a lot of founder and entrepreneurs are active on HN as well.

There is a long tradition of show HN were the comments poo poo startups and ideas which end up being huge and the opposite is also true with praise and admiration of failures.

nsa is storing everything

Visualization is a fancy package. Nobody looks at visualizations, but that's what makes people buy.

So basically data warehousing, and making it possible to do joins?

Super boring, but super important stuff, which I've seen neglected at far too many places I've worked.

Sounds like data engineering with a dash of ML.

Common sense gets in the way of gamblers instinct.

The impression I get from their involvement at one company I know of is that it’s very much the latter. I was pretty surprised to see them behaving and performing about the same as any parasitic enterprise software vendor with an integration services arm. One wonders how different they really are, and if maybe they just have very good PR and marketing.

Chalk it up as yet another case of some famous one-would-suppose impressive entity, or strata of a company hierarchy, or whatever, turning out to be pretty average, or even below average. You’d think I’d stop being surprised by now.

Then again, maybe I was just seeing their B-team.

This is exactly what I thought TFA was getting at when it brought up politics being a problem at companies and in sectors Palantir engages with, but instead it went a much more general direction.

This is a good post to explain the value proposition. It sounds like "Big Data" from the 1990s, but a very good salesperson was able to infiltrate some US gov orgs to sell the idea.

I’ve known companies to spend stupid amounts of money on fake, fancy “war rooms” they staff with people doing nothing useful, filled with “big board” style maps and shit, big graphs and visualizations that aren’t used anywhere else, just as a sales tool. Walk the visiting CEO through, let them pretend what they’re involved in is way cooler and more interesting and important than it really is, and I guess that assists sales so much that such endeavors make way more money than they cost.

I connect this with comments I heard from several major management consulting firm folks stating bluntly that the best way to communicate effectively with execs is to approach them like young children.

Life is super weird. Who knew imaginative play would be such a big thing for “serious” adults? I’d never have imagined, but it’s kinda everywhere.

All of them, plus whatever next vendor they “migrate” to in three years (I’m being generous).

He talks about it a little:

> Why is data integration so hard? The data is often in different formats that aren’t easily analyzed by computers – PDFs, notebooks, Excel files (my god, so many Excel files) and so on. But often what really gets in the way is organizational politics: a team, or group, controls a key data source, the reason for their existence is that they are the gatekeepers to that data source, and they typically justify their existence in a corporation by being the gatekeepers of that data source (and, often, providing analyses of that data). [3] This politics can be a formidable obstacle to overcome, and in some cases led to hilarious outcomes – you’d have a company buying an 8-12 week pilot, and we’d spend all 8-12 weeks just getting data access, and the final week scrambling to have something to demo.

I think he's seen more companies without talented Data experts than companies with that talent.

This makes it sound like their actual product is to be a bureaucratic/departmental door rammer?

Because the ostensible product, at least in the ‘pilot’, produced in just a single week, seems like it is pretty much guaranteed to be bad.

It’s also something you’ll never do in-house because there’s too many politics involved in getting everyone to give up their data.

Then when the CEO hires Palantir suddenly everyone has to.

Huh, I feel like we have the opposite issue. We have all those teams and I’m not sure what they’re actually doing.

They're like Oracle in that they focus their sales activity on the untouchable managers of managers, but their focus is on data integration and data analytics.

This all just sounds like any other consulting company, really?

It is completely self service by now. I have my own stack for testing purposes. Of course if you want to deploy this to an enterprise things will differ, but that is the same for Snowflake, Databricks etc.

They should help the business with the evidence to make all kinds of decisions, and in a platform-team kind of way help you self serve data needed to make decisions in your team.

It certainly sounds like they've created an excellent product both for its value to the customer as well as value to their shareholders.

That's what companies should all be built and optimized to do. That's what it's about.

My sense working at an adjacent company and having talked with folks there is that they are more successful with their government projects than their corporate ones.

I’ve heard you often get the A Team coming up with the plan and making the sale and then the B Team doing the actual implementation which surprise! doesn’t live up to the A Team hype. Not specific to Palantir.

Never seen people internally guard their data that much.

But who is going to do the heavy lift? who is going to get billed for that? who is paying for the cloud space, or licenses? absolute holy war.

no problems getting people into the data lakes, but if you want us to do anything useful with it you gotta pay / get people / get resources. but like, you want me to approve the read access or pull request? no problem, have at it.

I used to get paid to develop those war room monitoring solutions. literally just crafting dashboards that no one would ever look at directly, but just sorta had around.

> execs is to approach them like young children.

lots of images. bright colors. no more than 3 bulletpoints per slide. no more than 4 minutes to get to the point, and be unambiguous about what and why.

> approach them like young children

To take a generous go at this - my guess is that they have multiple urgent issues they're dealing with at any one time, and so the cognitive bandwidth they're able to dedicate to 'random presentation number 3 for the day' is quite low

But I do agree that a lot of day-to-day work is play acting at being cooler than our actual work.

Perhaps with the additional level of security clearance that government entities are able to hand over very sensitive data sets.

Are there any good forums where people do have good market knowledge and share it?