The State of AI Venture Landscape & Investment Opportunities in 2024
Key Takeaways and Insights from Our 2024 State of AI Event
2024 got off to a fantastic start with Untapped Ventures! This past month, we hosted our first in-person event of the year: The State of Artificial Intelligence (AI) Venture Landscape & Investment Opportunities in 2024, in partnership with the City of Burbank and Upstart Valley. It’s safe to say that the event was a huge success, and we couldn’t be more thrilled with the participation and insights shared by the phenomenal group in attendance.
At Untapped Ventures, our mission is to uplift humanity by investing in early-stage AI startups. This is precisely why we partnered with the city of Burbank – to bring some of the brightest minds in the entrepreneurial world together to dive deep into everything AI and accelerating business outcomes. It was a spectacular event and I was moved to meet so many passionate entrepreneurs who were excited to use the tools gained from our event to make the world a better place through efficient technologies.
Check out the 2 min recap video to get a sense…
I’d like to take a moment to delve into the core insights and discussions from our event, showcasing the undeniable momentum of AI in reshaping our world and the ways in which we can collectively harness this technology for a brighter future. Whether you're an investor, founder, or simply fascinated by the transformative power of AI, you'll find this recap not just informative but also a beacon guiding the path to unparalleled opportunities in the AI venture landscape of 2024 and beyond.
The Growing Tech Boom in Artificial Intelligence
Naysayers might not see the value in AI or question whether this trend is just for the time being. However, the numbers paint a different picture. Take, for example, ChatGPT, which reached over 100 million users in just two months after launching.
Artificial intelligence is rapidly overtaking the venture capital landscape. Over $25B was raised by AI companies in the first half of 2023, representing 18% of global funding. 2024 is the year to invest in AI opportunities, yet determining the right deal or fund in this massive landscape can be confusing. More than a third of venture capitalists surveyed by Pitchbook believe that artificial intelligence has the greatest growth potential across all sectors. Finally, median pre-money valuations for early-stage rounds of generative AI companies have increased by 16% in 2023. If that hasn’t convinced you to start investing or starting AI companies, take a look at Microsoft’s recent bent on AI, which saw its stock rise roughly 46% since the beginning of 2023.
AI is only getting bigger. And the time to get started investing in AI technologies is right now. In our event, we aimed to demystify the world of investing in AI, providing participants with the tools to navigate the ever-evolving AI venture capital landscape. Here’s a brief recap of what we learned together in our event.
Generative AI 101: What is it?
AI models have come a long way since its beginnings with Alan Turing in the 1950s. Broadly speaking, AI is a specialized topic in computer science that focuses on creating machine-powered abilities to replicate human intelligence and problem-solving. Many have questioned whether the powerful AI applications out there have thoughts, feelings, or emotions. Some types of AI, like generative AI, use natural language processing to use inputs to generate new feedback. Generative AI products have become so sharp and fast at its responses that they almost mirror human-like sentience.
At the moment, there are four big language learning models that exist. First, ChatGPT, which is powered by GPT-4. It is the primary tool for organized research, questions and answers, and the use of plugins to make sense of complex datasets. Another big LLM out there is Google Gemini, powered by a family of AI models - Gemini Nano, Gemini Pro, and Gemini Ultra. Gemini not only generates text like an LLM, it’s also natively able to handle images, audio, video, code, and other kinds of information. Pi is another major LLM-powered AI chatbot, which is powered by Inflection-1. It is an empathetic chatbot for human intelligence and intuitive brilliance. Finally, Claude, powered by Claude 2, is focused on ethics and security in fields like education and healthcare.
Principles of Investing in AI: How to Get Started
We broke down how to get started with investing in AI by diving into the three main aspects for successful returns on investing in AI.
Initial Screening
We walked participants through the principles of AI investing, emphasizing the importance of a quick initial screening process. Three key questions guide this stage: the company's position in value creation, the defensibility of its competitive advantage, and the mission's significance.
Defensibility Criteria
Investors were advised to look for defensibility through a Killer Go-to-Market (GTM) strategy, proprietary data moats, and creating customer "stickiness" via seamless workflow integration. Investors should focus on startups that address real problems in substantial markets, offering 10x or even 100x better experiences.
Due Diligence
The due diligence process involves both technical and business aspects. Technical considerations include data, computing costs, competency, and model specifics. On the business side, scalability, business model viability, team competency, and ethical data practices are essential.
Looking Ahead and Next Step
We were moved to hear rave reviews from attendees of the event, who brought valuable insights and stories of their own investing journeys. Although AI technologies are powerfully moving at rapid speed, there is nothing quite that compares to the energy of an in-person event. As the AI landscape continues to evolve, Untapped Ventures remains committed to guiding investors through the complexities of this transformative technology. We look forward to continuing our partnership with the city of Burbank for future events.
If you’re a founder building in AI, we’d love to hear from you! Pitch us here.
If you’re beefing up your investments in AI and/or use of AI in your company and would like to chat, book a call with me here.