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AI / Business development

Why a small Greenpoint team is building artificial intelligence to help managers

It's something startups don't pay a lot of attention to, but corporate managers can make or break young companies.

The Butterfly.ai founders. From left: Simon Rakosi, Marcus Perezi-Tormos and David Mendlewicz. March 22, 2017. (Photo by Tyler Woods)
As far as the guys at Butterfly.ai can tell, there’s a big, unaddressed problem in startups: management. It’s expensive and easy to skimp on, but it’s super important to worker retention.

It’s a problem particularly pronounced in the Brooklyn startup world, where hierarchies, HR departments and other orthodoxies of the traditional corporate world have frequently lost favor, in place of leaner, egalitarian and freer company cultures.

But the “move fast and break things” mentality that Facebook made popular has its drawbacks, too. Just look at Thinx.

“The three of us in different companies, we faced the reality of being a manager and how hard it is and how bad we’re served by the company and the educational system,” explained Butterfly cofounder David Mendlewicz, speaking about his two cofounders, Marcus Perezi-Tormos and Simon Rakosi.

“Marcus faced that when his company got acquired,” Mendlewicz continued. “Their cultures clashed and he was not trained to face that. Simon had the same experience working at Coke, getting lots of responsibility and no support. My own experience, my last enterprise crashed, I think totally due to mismanagement.”

And so the three cofounders (who also, somehow, live together in an apartment in Greenpoint) have built a software product that acts as a companion to managers, helping them understand the issues their teams have, and acting as a resource in addressing those issues.

https://twitter.com/bttrflapp/status/822159060585840640

Butterfly sends out a short poll to workers each week on the office environment, collects and crunches the data for the manager, and sends it to the manager in a small report. It then pulls from a database of academic journals and trusted news sources articles that speak to the issues the manager faces. Managers can upvote or downvote the value of suggested materials, and the software learns what’s most relevant to them as it goes along.

“People were complaining they had back pain,” in one example, Mendlewicz explained. “The thing the tool came up with was the importance of being healthy at work and what’s the impact on profitability.”

It’s great to have a company where workers like to be, but it’s also a matter of the bottom line. Unhappy workers leave, and the process of hiring and training new workers, and then waiting for them to catch up to a learning curve takes resources.

“If you take some industries you find 50 percent attrition year over year, because people are overworked and it’s because you’re seen as an asset. The U.S. average is about 30 percent. That has a direct cost,” explained Rakoski. “People never leave a company, they leave a manager.”

If it’s any corroboration of their message, during our interview, which took place in the office’s sort of living room room, the sound of employees laughing together continually came through the closed door to the main office room. Later, I had the chance to ask a worker if he liked working at the company.

“Yeah I do. I’m still here at 6:30, aren’t I?” he responded.

Series: Brooklyn

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