A San Francisco tech company has partnered with Churchill Downs to harness its artificial-intelligence software in predicting Derby finishers. | Photo by Lou Oms via Creative Commons

By Fernando Alfonso III | Lexington Herald Leader

The artificial intelligence company that successfully predicted a “cold superfecta,” a 540-1 odds wager with an enormous payoff, at the 2016 Kentucky Derby is back in the saddle.

San Francisco-based Unanimous A.I. has partnered with Churchill Downs and its wagering service, TwinSpires, to harness its human-based, artificial-intelligence software in predicting the first-, second-, third-, and fourth-place Derby finishers this year. The software helped Unanimous’ CEO, Louis Rosenberg, win $10,842 from a $20 dollar Derby bet last year.

Unanimous A.I. CEO Louis Rosenberg

On Wednesday, about 40 top handicappers will use the artificial-intelligence software to share their picks for the big race. The process is similar to a game of tug-of-war, in which the 40 horse racing experts discuss their selections while moving a digital planchette around a board. Unanimous calls this exercise a “swarm,” based on the study of bees and how they find a home.

“Groups are smarter than individuals if you can tap their intelligence,” said Rosenberg, 45, the company’s founder and CEO. “This is proprietary technology we’ve built over the last three years. It’s modeled after how nature does it, most closely to how bees make decisions. Bee swarms are remarkably smart. They can make very optimized decisions even though individual bees are so simple.”

Unanimous’ picks for the May 6 race will be released to the public Thursday and will be the basis for a $10,000 Players’ Pool on TwinSpires.com.

One of the handicappers participating in the UNU swarm is Ed DeRosa, 37, who has worked in the horse racing industry since 2002. DeRosa worked for nine years as a reporter at the now defunct Thoroughbred Times and left in 2011 for TwinSpires. He has never won a straight superfecta.

“The Derby is a race where you kind of swing for the fences a little bit,” DeRosa said. “I handicap the races myself every day. For the Derby, there’s so many opinions. Everyone handicaps differently. What I really like about this approach, it allows you to have that individual perspective. (Unanimous) uses their approach to weigh all the different factors and the strengths of different opinions.”

Since Unanimous made its Derby prediction last year, the company has been on an algorithmic tear. The company has accurately predicted the winners of the 2017 Academy Awards, the 2016 World Series, and this year’s Super Bowl.

Those predictions help draw media attention to Unanimous, but the company, which employs 25 people, makes its money through contracts it has with companies interested in putting its technology to work “making more accurate predictions about their business forecasts,” Rosenberg said. Unanimous has nondisclosure agreements with most of these companies. They include a large soft drink company, a fast food business and a financial services firm.

Rosenberg plans on cautiously putting some more money down on the Derby this year.

“With any sports, especially with horse racing, there’s always luck involved,” said Rosenberg, who got his bachelor’s and master’s degrees and his doctorate from Stanford. “All we can do is have the swarm make the smartest possible prediction, but the smartest possible prediction may not happen. There’s randomness and unexpected things that happen.”