Aug 21 - Arkifi, an artificial-intelligence startup that provides workflow automation tools for financial institutions including hedge funds and investment banks, said on Monday the company had raised over $9 million in seed financing.

The financing was co-led by Khosla Ventures and Nyca Partners, with participation from Soma Capital, MVP Ventures, Valiant Capital Employee Fund, Correlation VC and G&H Partners.

Palo Alto, California-based Arkifi says its products can perform many of the functions that form the bread and butter of a financial analyst’s day, including information retrieval on public markets, building financial models and customizing spreadsheets. In addition, Arkifi does not hallucinate, a term for when AI models make up false information, said Chief Executive Officer Hesam Motlagh. Arkifi will also build a plug-in for the Microsoft 365 Copilot AI product.

Since Microsoft-backed OpenAI launched the ChatGPT chatbot which created a sensation, global enterprises have been racing to figure out how to use generative AI to make company workflows more efficient.

“It’s a classic example of what will happen in many, many industries,” said Vinod Khosla, founder of Khosla Ventures. “You take a function where there is a lot of grunt work and the AI does that work for you, so you can spend more time thinking and doing the more creative stuff.”

Arkifi said its customers include large financial institutions, though it declined to identify any. On Monday, the company opened a public waitlist.

Motlagh said that Arkifi can replace much of the work that junior financial analysts, typically new college graduates, perform, such as pulling public company information and formatting spreadsheets.

“In the long run, this will disintermediate some human labor,” he said. (Anna Tong in San Francisco Editing by Matthew Lewis)