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Introduction	to	Artificial	Intelligence	and	
Machine	Learning	…	for	policy	makers
1
Raffaele	Mauro
Managing	Director
Endeavor	Italy
Rena	Summer	School
Matera,	August	2017
Technology
Finance	&	
Venture	Capital
Policy	
Innovation
PR	wars
Fake	news	&	PR	wars
Robophobia!!
Reality:	Engineering	breakthroughs	
+	massive	investments	…	but	long	road	ahead
Self-driving	
vehicles	(drones,	
submarines,	cars)
Speech	
recognition
Image	recognition	
&	search
Intelligence	
analysis	
Manufacturing	
automation
Gaming
Virtual	assistants
Antispam	
filters
Automatic	
translation
Anti-fraud	
systems	and	
credit	scoring
Medical	
diagnosis
Robotics
Recommendation	
systems
Robotics
Narrow	Vs	General	AI
From	a	limited	set	of	specific	capabilities	to	autonomous	intelligent	
agents	with	general	reasoning	and	real	world	autonomy?
?
Perception	
Learning
Planning
Reasoning
Mobility
…....
Expanding	set	of	
tasks	efficiently	
performed	by	
machine	
intelligence	
+
AI	is	everywhere	
but	we	are	not	
calling	it	“AI”	
anymore
Competing	with	humans:	
IBM	Deep	Blue,	IBM	Watson,	Google	AlphaGo
1996-97 2011
Google
2017
VC	investments	in	early	stage	AI	companies
Italian	VCs	investing	in	AI:	August	2017
Google	– Investment,	Research,	Applications
Example:	Google	Gmail
Source:	Google	Blog	https://gmail.googleblog.com/2007/10/how-our-spam-filter-works.html
“Software	is	eating	the	world”	(M	arc	Andreessen)
“Mobile	is	eating	the	world”	(Benedict	Evans)
“AI	is	eating	the	world”	
Source:Facebook,	Business	Insider	http://www.businessinsider.com/facebook-f8-ten-year-roadmap-2016-4?IR=T
“…quando	orientur controversiae,	non	magis disputatione opus	erit inter	duos philosophus,	
quam inter	duos computistas.	Sufficiet enim calamos in	manus sumere	sedereque ad	abacos,	
et	sibi mutuo	(accito si	placet	amico)	dicere: calculemus!”	(Gottfried Wilhelm	Leibniz)
Computational	thinking
Alan	Turing	
“A	computer	would	deserve	to	be	called	intelligent	if	it	could	deceive	
a	human	into	believing	that	it	was	human.”
“Most	of	our	future	attempts	to	build	large,	growing	Artificial	Intelligences	
will	be	subject	to	all	sorts	of	mental	disorders.”
Marvin	Minsky
History	of	AI:	
Multiple	Gartner	Cycles	&	“AI	Winters”
5	Paradigms	of	AI
• Inspired	by	Logic,	Philosophy	and	
LinguisticsSymbolic
• Inspired	by	NeuroscienceConnectionist
• Inspired	by	Evolutionary	BiologyEvolutionist
• Inspired	by	Probability,	Statistics	and	
CombinatoricsStatistical
• Inspired	by	Psychology and	MathematicsAnalogical
Source:	Pedro	Domingos,	“The	Master	Algorithm”,	MIT	Press,	2015
• Popular	from	the	50’s	to	late	80’s	
• Focus	on	Logic	(if-then	rules,	etc.)
• Focus	on	problem	solving
• Limited	learning	capacity
• Knowledge	engineering
Symbolic	Approach:	Logic	and	Decision
Source:	edu(b)log	http://thinkdifferent.typepad.com/edulog/
Symbolic	Approach:	Expert	Systems
Knowledge	engineering:	ontologies,	knowledge	representation,	
natural	language	processing,	reasoning,	decision
Source:	Steve	Copley,	IGSE	ICT	https://www.igcseict.info/readme/index.html
• Intelligent	Agents:	rational	and	autonomous,	perceive	environment,		take	decisions	
based	on	a	specific	objective,	plan	action	to	achieve	it
• Perception:	recognition	(vision,	etc.)	of	the	environment	
• Actuation:	navigation	or	manipulation	of	the	environment
On	step	beyond:	Intelligence	Agents
Source:	Pattie Maes,	MIT	Media	Lab	- Artificial Intelligence:	A	Modern Approach by	Stuart	Russell	and	Peter	Novig.
• Decision:	Simple	reflexes	or	
complex	reprensentation of	the	
world	(internal	states)	with	
reasoning
• Problem	representation	&	state	
space
• Actions	generate	passage	from	
state	A	to	state	B
• Solution	->	from	existing	state	to	
optimal	state
• Exploring	state	space	has	
computational	cost
Symbolic	Approach:	Problem	Solving
Source:	Daniel	Valana,	Jared	Bouchier,	Xin Yuan,	University of	Adelaide	Student Wiki.
Blind	search:	brute	force
• Backward	search:	
starting	from	the	solution
• Backtracking:	error	/	obstacle	
->	go	to	previous	step
• Depth	first	(LIFO,	queue)	
Vs	breadth	first	(FIFO,	stack)
Heuristic	search:	based	on	
knowledge
Symbolic	Approach:	State	Space	Search
Source:	William	H.	Wilson,	University of	New	South	Wales,	http://www.cse.unsw.edu.au/~billw/
Natural	Language	Processing
NLP:	Interaction	between	machines	and	
human	languages,	with	tasks	regarding	
syntax,	semantics,	discourse	and	speech
Structure:	Mix	of	techniques	from	
traditional	symbobolic-linguistic	to	deep	
learning
Examples	of	corporate	APIs:	Google	
Cloud	Natural	Language	API,	IBM	
Watson,	Amazon	Lex,	Microsoft	
Cognitive	Services,	Facebook's	DeepText
Applications:	Translation,	Chatbots,	
Automatic	summarization,	Antispam,	
Information	extraction/classification	
Source:	Natural	Language	Toolkit	http://www.nltk.org/
Rules	Vs	Learning
Learning	is	the	key	to	intelligence	acceleration
?
• Machine	learning:	mix	of	connectionist,	
statistical,	genetic	and	analogical	paradigm.	
Between	data	science	and	AI
• Why:	Automatizes	automation,	accelerates	
progress,	human	programmer	and	
instructions	no	more	as	a	bottleneck
• Example:	Go	game,	n° of	potential	moves	is	
10170, higher	than	the	number	of	atoms	in	the	
universe	1080	
• Applications:
• Basket	analysis	in	ecommerce:	learnin associations	
with	conditional	probability
• Credit	scoring	in	finance:	learning	classifications:	if	
income	>	X	AND	savings	>	Y	=>	Low	risk	(grafico)
• Medical	diagonosis:	pattern	recognition
• Predictions	in	financial	markets
• Bioinformatics
• Games	
Machine	Learning
Classification	Vs	Regression	Analysis
Classification Regression
Sources:	http://www.whatissixsigma.net/ and	https://jaxenter.com/machine-learning-an-introduction-for-programmers-122135.html
Classification: Separate	data	finding	discrete	category	/label	
Regression:	Find	coefficients	of	the	line	that	minimize	distance	between	
observation	points	and	prediction	line
Supervised	Vs	Unsupervised	learning
Supervised:	Learning	a	class	from	labeled	examples
Source:	-
Reinforcement	learning
Source:	Berkeley’s CS	294:	Deep Reinforcement Learning		by	John	Schulman &	Pieter Abbeel
Example:	Gaming,	Robotics,	Self	Driving Cars
Overfitting:	Model	with	low	generality	and	too	much	tied	to	a	specific	
training	set
Solution:	Less	variables	and	larger	training	set
Overfitting	Vs	Underfitting
Source:	http://www.turingfinance.com/regression-analysis-using-python-statsmodels-and-quandl/
Connectionist	Approach:	Neural	Netowrks
Source:	Wikimedia Commons.
• Imitating	biological	
computation	in	neurons
• Dealing	with	complexity
and	uncertainty
• Non-symbolic	knowledge	
representation
• Learning	capability
• Parallel	computation
Source:	Wikibooks
Connectionist	Approach:	Perceptrons
• Input	on	“dedrites”	then	”cell	body”	compute	weights	
• Output:	0,	1	/	yes-no	after	a	threshold	in	the	“axon”
Connectionist	Approach:	Classification
Source:	Wikimedia Commons
Classification:	the	perceptron	
separates	inputs	in	two	classes	with	
a	linear	boundary	
Boundary:	Straight	line	in	2	
dimension,	plane	in	3	dimensions,	n-
1	hyperplane	in	n	dimensions	(=n	
variables)
Learning:	Inclusion	of	new	elements	
in	the	training	set	increases	accuracy
Limits:	Complex	boundaries,	XOR	
functions
Backpropagation: real	output	confronted	
with	expected	outcome	and	change	weights	
in	neuron	connections
Multilayer	perceptrons:	hidden	layer	beyond	
input	and	output	layers
Complexity:	Classification	/	learning	with	
non	linear	boundaries
Applications	examples: speech	recognition,	
image	recognition,	machine	translation
Gradient	descent:	Analogy	with	loss	function	
finding	local	minimum
Connectionist	approach:	
Multilayer	Perceptrons and	Backpropagation
Source:	Wikimedia Commons
Deep	learning:	multilayer	
perceptron	with	multiple	
layers	inside	->	network	forced	
to	extract	salient	
characteristics
Applications:	NLP,	translation	
vision,	speech	&audio	
recognition,	bioinformatics
Pros:	Learning	of	abstract	
concepts	without	human	
supervision
Cons:	Non-transparent	logic
Deep	Learning
Source:	http://www.kdnuggets.com/2016/01/seven-steps-deep-learning.html
Human	Brain:	Operationally	
flexible	and	algorithmically	
compact	(DNA)
Combination	of	approaches:	in	
part	learning	neural	net,	in	part	
specialized	regions	(visual	cortex,	
cerebellum)
Hierarchical	Order
Reading:	“How	to	create	a	mind”	
R.	Kurzweil,	“On	Intelligence”,	J.	
Hawkins,	S.	Blakeslee
The	Brain	Analogy
Source:	Wikimedia Commons.
Genetic	Algorithms:	first	mentioned	
by	John	Von	Neumann	as	self-
replicating	machines
Structure:
• Set	of	automata	with	casual	variations	
• Fitness	function	to	be	maximized
• Then	mutations	and	/	or	random	
crossover-reproduction
• Selection	of	a	new	generation
• Iteration
References:	Santa	Fe	Institute,	
Melanie	Mitchell
Evolutionist	Approach:	Genetic	Algorithms
Source:	Quantdare	https://quantdare.com/
Local	Minima	problem
Source:	Sebastian	Raschka Blog,	https://sebastianraschka.com/
Algorithm	does	not	reach	the	global	maximum
Dataclism: Explosion	in	data	production,	storage	and	availability
From	data	to	knowledge:	New	power	for	statistical	techniques:
Statistical	Approach:	Data	Explosion
Source:	P Desjardins-Proulx blog,	http://phdp.github.io/blog.html
• Bayesian	techniques:	Use	probability	
theory	and	Bayes	theorem	to	
uptdate existing	knowledge	
incorparating new	data	
• P(A)	=	P	event	#1
• P(B)	=	P	event	#2
• P(A|B)	=	Probability	of	A	if	B	is	true
• P	(B|A)	=	Probability	of	B	if	A	is	true
• “Degree	of	belief”	subjective	/	
theoretical	(Vs	frequentist	/	
experimental)
• Example:	Google’s	antispam	filter
Statistical	Approach:	Bayesian	Reasoning
Markov	Chain:	sequence	of	states	with	
probabilistic	relation	
Example:	In	a	sentence,	if	there	is	the	
word	X	then	there	is	a	probability	P	than	
the	next	word	will	be	Y
Example:	Google’s	Page	Rank	
Hidden	Markov	model:	Hidden	states,	
operates	as	a	dynamic	Bayesian	network
Example:	Apple’s	voice	recognition
Monte	Carlo	Chain:	random	values	from	
probability	distributions,	then	find	
outputs	from	each	set	of	values
->	complex	models	without	complex	
functions
Statistical	Approach:	Markov	Chains
Source:	Wikimedia Commons.
Nearest	Neighbor:	Supervised	learning	
algorithm	based	on	analogy,	measured	on	
the	distance	from	other	data	on	a	
plane/space	
Data: classified	with	the	most	frequent	label	
among	the majority	of	k nearest	training	
samples	
Training->	Distance	measure->Classification
Dimensionality	reduction:	Fundamental	for	
application
Applications:	Pattern	recognition
Analogical	Approach:	
k-Nearest	Neighbor	algorithm
Source:	Wikimedia Commons.
• Support	vector	machines:	
Supervised	learning	with	looking	for	
nearest	points	to	separation	margins,	
with	more	margins	in	“competition”
• Objective:	Maximize	margins,	or	
distance	with	separation	hyperplane
• Kernelization:	Bring	data	on	higher	
dimensions,	where	higher	margin	
exists,	even	if	it	wasn’t	present	in	
normal	dimensionality
Analogical	Approach:	Support	Vector	Machines
Source:	EFDB,		http://efavdb.com/ and	OpenCV http://docs.opencv.org/2.4/index.html
K-Means:	Classification	of	unlabeled	data- clustering	di	dati non	strutturati
K =	n° of	neighbors	to	be	found						Centroid:	Middle	point	in	a	cluster
Set-up:	choice	of	centroid	and	position	data
Calculation:	Reposition	centroids	and	iteret until	threshold
Example:	Face	recognition
Unsupervised	Learning:	K-Means
Source:	http://iancat.tistory.com/6
Problem:	If	training	set	contains	prejudices,	output	will	be	projudiced
Example:	Word	associations	with	minorities
Solution:	Equal	opportunity	by	design	?
Amplifying	Prejudice	?
Source:	https://factordaily.com/dangers-of-artificial-intelligence/
Man-machine	integration
Intelligence	
Analysis
Policy	/	Etiquette	
Enforcement
Automatic	screening	followed	by	human	judgement
Extended	Moore’s	Law
Intelligence	Explosion
Intelligence	Explosion
• Vernon	Vinge
• Hans	Moravec
• Nick	Bostrom
• Elizer S.	Yudkowsky
• Ben	Goertzel
• Ray Kurzweil
Speculation	on	Super-human	AI	
“The	term	“Singularity”	in	my	book	is	comparable	to	the	use	of	this	term	by	the	physics	community.	Just	as	
we	find	it	hard	to	see	beyond	the	event	horizon	of	a	black	hole,	we	also	find	it	difficult	to	see	beyond	the	
event	horizon	of	the	historical	Singularity.	How	can	we	….	imagine	what	our	future	civilization,	with	its	
intelligence	multiplied	trillions-fold,	be	capable	of	thinking	and	 doing?” (Ray Kurzweil)
Maybe	the	Singularity	is	not	near	…...
Or	maybe	we	should	fear	the	Roko’s Basilisk	!
“Roko's basilisk	is	a	thought	experiment	about	the	potential	risks	involved	in	developing	artificial	
intelligence.	The	premise	is	that	an	all-powerful	artificial	intelligence	from	the	future	could	retroactively	
punish	those	who	did	not	help	bring	about	its	existence,	including	those	who	merely	knew	about	the	
possible	development	of	such	a	being.	It	resembles	a	futurist	version	of	Pascal's	wager.”
(Source:	RationalWiki)
Ethics	and	“Friendly”	AI
China:	Rising	innovation	performance
China:	Rising	innovation	performance
Quantum	machine	learning
Google	/	NASA	Quantum	AI	Lab
Online	courses
Andrew	NG
Francesco	
Mosconi
Sakynthala
Panditharatne
Machine	Learning
Zero	to	Deep	
Learning™	with	
Python	and	Keras
Neural	networks	
for	hackers
Books
rmauro@post.harvard.edu
raffa.mauro@gmail.com
Thank	you	!
Raffaele	Mauro,	Ph.D.	
Raffaele Mauro is passionate about technology, policy and global finance.
Now Managing Director at Endeavor Italy, he is focused on high-impact entrepreneurship and venture capital,
providing companies access to smart capital, talent and markets.
Previously he was Head of Finance for Innovation & Entrepreneurship at Intesa Sanpaolo and worked at venture
capital funds such as United Ventures (formerly Annapurna Ventures), P101 and OltreVenture.
Raffaele is a Kauffman Fellow and holds an MPA from Harvard University, a Ph.D. from Bocconi and is alumnus of
the Singularity University Graduate Studies Program at NASA Ames.
Raffaele co-authored the book “Hacking Finance”, an essay on Bitcoin, blockchain and cryptocurrencies, and was
invited speaker at EY EMEIA Accelerate, Wired Money and the Bundesbank. He invested and advised several
companies including Multiply Labs (YC 2016).
Raffaele is also Junior Fellow at the Aspen Institute, member of the Young Leaders group of the US-Italy Council,
member of the “Young European Leaders – 40 under 40” cohort of 2011, member of the scientific committee at
Blockchainlab.it and member of the executive committee at the Global Shapers Hub - Milano, a World Economic
Forum community.
Twitter: @rafr
69

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