The Future of Business Intelligence: How AI is Transforming Due Diligence

Artificial intelligence is often seen as a tool for accelerating existing manual processes. But the real opportunity lies in transformational change. At Xapien, we call this dynamic due diligence—a new approach that revolutionises how businesses assess third-party risks.

Xapien exists to answer a fundamental question for businesses:

What does the world know about this third party?

Whether investing, partnering, or accepting donations, organisations must conduct due diligence. Historically, this has been the domain of professional services firms, but AI is now reshaping this space.

Traditionally, due diligence has been a labour-intensive process, requiring human analysts to sift through vast amounts of data. But much of this is heavy lifting, tasks that AI can now automate. This shift allows humans to focus on what they do best: applying judgment and nuance.

AI is disrupting professional services in the same way that the production line transformed manufacturing. We are witnessing a fundamental shift, with AI replacing manual data processing and enabling faster, deeper insights.

AI adoption varies widely. Some companies actively seek AI-driven solutions to demonstrate innovation, while others remain cautious. At Xapien, we primarily work with risk and compliance teams, traditionally conservative in their approach. However, these teams recognise that the bad actors, those using phishing, deep fakes, and fraud are already leveraging AI. To keep pace, businesses must embrace AI-driven solutions.

The real value of AI is in transformation, not just acceleration. Consider early document management systems: they began as digital filing cabinets, but true innovation came when businesses leveraged search capabilities and analytics. The same is happening in due diligence. Traditional methods provide a static, one-time snapshot, whereas AI enables a living, interactive due diligence report—continuously updating throughout the relationship with a third party.

Today, companies are judged not only on their own actions but also on those of their suppliers, investors, and partners. Due diligence traditionally happens late in the process, when a business is already invested in a relationship. Because manual due diligence is expensive, it’s often reserved for later-stage decision-making.

Xapien moves this process upstream. By using AI, businesses can assess potential partners before investing time and resources. This shift makes due diligence a business enabler, allowing companies to focus on the right relationships from the start.

The risk environment is constantly changing. Whether due to evolving sanctions, ESG concerns, or compliance requirements, today’s risks are not necessarily tomorrow’s. Many companies have built manual processes tailored to current risks, leaving them vulnerable to future threats. AI-driven solutions like Xapien provide the agility needed to adapt to emerging risks.

A common pitfall in AI adoption is chasing trends rather than solving real business problems. Some companies add AI just to appear innovative. This is what we call “AI washing.” The best AI solutions are deeply integrated into a business’s broader offering.

At Xapien, we use a combination of machine learning models and LLMs, but we don’t just link to a chatbot and call it AI. We’ve built a solution that stitches together multiple AI capabilities to solve real problems.

Another key lesson: Be willing to let go of outdated solutions. AI evolves rapidly. Some of the tools we built years ago have been replaced by better third-party offerings. As an entrepreneur, you must be prepared to pivot, discarding what no longer serves your business in favour of what drives growth.

One of the biggest challenges for AI start-ups is staying focused. At Xapien, we want our platform to be a universal solution. Our vision is for “Xapien” to become a verb: “Have you Xapiened your third parties?” However, we recognise that achieving this goal requires strategic focus.

We’ve adopted an approach called being uncomfortably narrow—targeting specific sectors where we can gain traction quickly. Rather than spreading ourselves too thin, we’ve prioritized sectors where we can build revenue and establish credibility before expanding further.

Another challenge is hiring top AI talent. Attracting skilled professionals isn’t just about competitive salaries—it’s about building a strong company culture. Over the past year, we’ve defined nine core principles that guide how we operate. These values—like “Move fast and always be decent” and “Hire A-players”—help us attract and retain the best talent.

AI is not just a tool for big corporations. In many ways, it favours small businesses, allowing them to move faster and be more agile than their larger counterparts. Rather than building everything in-house, small businesses can leverage AI-powered third-party solutions to solve problems quickly and cost-effectively.

We’ve found that whatever challenge we face, whether in marketing, customer support, or compliance, there’s likely an AI-driven solution available. The key is to stay dynamic, continuously evaluating new technologies and integrating them where they provide the most value.

AI offers a fundamentally different approach to business intelligence and due diligence. The traditional choice has been between searching a database or paying an analyst for a manual investigation.

AI introduces a third option which results in:

• Speed of a database search
• Depth of a manual report
• Continuous, real-time updates

For example, we work with Ivy League universities conducting due diligence on major donations. In one case, a university spent 18 months nurturing a nine-figure donation before discovering compliance issues that forced them to reject it. With AI-driven due diligence, they could have identified the issue at the start, saving significant time and resources.

Similarly, Griffin, a banking-as-a-service provider, uses Xapien to vet potential partners. By integrating due diligence at the start of the process, their compliance team can steer efforts away from high-risk prospects before significant time is invested.

AI is evolving rapidly, and running an AI startup is demanding. My biggest advice for entrepreneurs: Don’t do it alone.

At Xapien, three of us lead the company together, and that support system is invaluable. When one of us is feeling the pressure, the others step up. Building and leading a company is a marathon, not a sprint, and having the right team in place makes all the difference.

AI is not just about efficiency, it’s about transforming entire industries. For business intelligence and due diligence, AI offers a way to move faster, make better decisions, and stay ahead of evolving risks.

Companies that embrace AI early will have a competitive advantage. Those that wait may find themselves struggling to keep up. The question is not if AI will reshape your industry, it’s when.

And when it does, will you be ready?

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