AI, Compliance Anxiety, and My Friend Andreas
Compliance. It’s a word that sends a shiver down the spine of any entrepreneur. And it's something that causes me, an immigrant entrepreneur, a particular kind of anxiety.
Germany is notoriously bureaucratic and private. And Europeans in general are increasingly skeptical of being surveilled by American tech (both public and private). The result is that even starting a website—like the newsletter archive I recently created for CrossCurrents—comes with serious compliance obligations.
Europe’s flagship privacy law is known as the General Data Protection Regulation (GDPR). Among many other things, the GDPR requires that website owners disclose what organizations have access to the personal data of those who visit their website, the grounds for allowing access to that data, the ability to opt out.
Sounds straight forward and reasonable, but even a small website that doesn't process payments might be linked, on the back end, to a half dozen or more service providers. Compliance is time consuming and often costs money, and noncompliance risks huge fines. It’s enough to make me thankful that I’m not in a more heavily regulated industry. Like…well just about every other industry.
But could AI rescue me—rescue all of us—from the byzantine grip of regulatory compliance?
My former neighbor Andreas Fredrich thinks so. Andreas recently founded ATRULOGSYS, a German startup that is producing “a modular SaaS platform that deploys specialized AI agents to automate compliance tasks.”
I recently chatted with Andreas and one of his three co-founders, Kátia Mendes de Barros, about AI and the solution they’re working on to help people like me stay out of regulatory trouble. And then I gave the system a test drive. I’m an AI skeptic, but I’m optimistic that Andreas and Kátia may have found a way that AI will truly make our lives easier.
Our interview, edited for length, is below.
Brian: My business is a marketing company. It's not heavily regulated the same way other industries are, but I don't know what's needed of me, and I live in fear that I've done something wrong and don't know what it is yet.
Andreas: Exactly. When you start a company in Germany, in Europe, you have a lot of regulations. And paper. Germans love paper.
Brian: They do. Was there a specific moment where you wished there was a tool that could help?
Andreas: About two years ago, I was working in a bank and suddenly I was the project manager for a million-dollar instant payments project. The customer was waiting for me to explain the regulations. My internal team was waiting for me to explain the regulations. And I was confused [the actual regulations were] a book of 100 pages, very complicated.
That was when OpenAI started [with ChatGPT, in 2023], so I put the regulations in and asked it to help me. It was useful, very basic, explained a lot. But I found out really pretty fast that it has hallucinations. You cannot trust it 100%.
That was basically when the idea was born.
Brian: Hallucinations are probably the biggest hurdle to enterprise AI adoption. How do you handle that?
Andreas: We built something into the platform—an observer, a policy agent—that controls what gets to the user. He's just observing and switching in when a hallucination appears.
Katja: It shows you exactly where the information came from. It has to cite the source—not just say "this and that" the way ChatGPT would. You also get a confidence score.
Brian: So you're not saying "this is 100% accurate." You're saying, here's our confidence, here's where you can find more, and here's how you can check it yourself.
Andreas: We want to give sovereignty back to mid-sized companies. Right now, if you use AI, your data goes to one big pot — and it's all in the United States. Our platform works completely independently. A mid-sized company can use it entirely internally.
Katja: It all runs locally. You don't send your data anywhere.
Brian: That’s very important here in Europe.
Katja and Andreas: Yes!
Brian: And where are you now in development?
Katja: We have actually two prototypes that are already running with potential customers.
Andreas: We received funding from the German government, Ministry of Energy in Berlin. Our prototypes are in healthcare, media and telecom, and for mid-sized companies. In about one month, we will go live.
News from the WestWord Office
My parents were in town last week, so I took a wee break from things. I didn’t even post on social media! A break is a wonderful thing. Shout out to Tommy for holding things down at WestWord while I was gone. Business partners, too, are a wonderful thing.
Brian Blickenstaff is Clickin’ Stuff
A newsletter: I have been subscribed to Rachel Karten’s Link in Bio substack for a while now. She’s super smart on all things social media, and I struggle to think of a newsletter that delivers more consistent value on a subject that matters to my business.
A poem: Every once in a while I read Thank You by Ross Gay and feel a little better. Thanks, Ross.
A short story collection: There was a time in the not-so-distant past when I aspired to publish a book of short stories. The rise of AI and a soul-crushing experience trying to sell a different book to publishers resulted in me stepping away from creative writing for a few years, but this newsletter has me reconsidering. It’s been a joy to write. And, last week, for the first time in a couple years, I cracked open a book of short stories. The book was Back in the World by Tobias Wolff. Tobias is easily one of my top five favorite short-story writers. I’m only one story in, but so far so good. Maybe I’ll start writing my own again soon.
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