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Tuesday April 28, 1:00PM EST
The Flood Gates are Opening for Artificial Intelligence
Dear Startup Investor,
Back in 1950, Isaac Asimov published the science-fiction classic I, Robot.
These short stories paint a future where humans live alongside near-autonomous androids. This futuristic vision was at times a utopian, at other times a dystopian, image of the future of artificial intelligence… now colloquially known simply as AI.
While we’re still not quite at the point of in-home robot housekeepers and cooks (I know, we’re disappointed too), in many ways, the future of artificial intelligence is upon us – and progressing fast.
How prevalent is the use of AI throughout society?
Well, consider the following…
About 33% of consumers believe they use technology that features artificial intelligence. The truth is, 77% of consumers do.
Perhaps it’s the fact that many people assume artificial intelligence must refer to bipedal robots. But that’s far from the case. AI processes are already being used throughout the business world.
In 2021, the global artificial intelligence market was worth $92.53 billion.
Let’s not pop the champagne quite yet…
By 2028, the market will grow to $997.77 billion. That’s a whopping 40.2% compound annual growth rate.
That’s right! Within the next six years, the artificial intelligence market will grow by more than 10X.
By the year 2030, AI is expected to add a mind-shattering $15.7 trillion to the global economy.
One of the reasons for this tremendous growth and value isn’t complicated – it will save businesses an immense amount of money. In fact, it already is doing exactly that.
Since 2016, Netflix indicated that its machine-learning (aka AI) algorithm saves the company $1 billion a year.
These sorts of improvements aren’t restricted to the multi-billion-dollar corporations, either. In 2022, 37% of businesses are currently emoyiplng AI.
That number will continue to rise. As of 2021, 91% of the leading businesses in America say they have investments in AI technology. Of that group, 91.7% are increasing their investment.
The reality is, as processes continually improve, artificial intelligence becomes a more and more feasible proposition for businesses.
In a beautiful inverse relationship, as artificial intelligence becomes more powerful, it simultaneously becomes less expensive.
We seem to finally be reaching the tipping point where AI – and its procedural improvements – is less theoretical for businesses and more applicable.
In that same vein, the decreasing barriers to entry into AI are opening doors for startups even further.
In the past two decades, the number of artificial intelligence startups has grown by 14X. Meanwhile, the amount of money invested in these startups has increased 6X.
In 2021, AI startups recorded a record $59 billion in investment, a steep change from the $28 billion recorded the year before.
As these technologies continue to improve, their value-add propositions for businesses grow alongside. That’s a big reason why we’re seeing more and more acquisitions in the space.
And it isn’t just multinational corporations getting in on the fun. Venture-backed startups spent $8 billion acquiring a total of 72 artificial intelligence developers in 2021 alone, up from 49 in 2020.
As you can see, the current landscape of artificial intelligence in the business – and particularly startup – world is busier than ever before.
So, for angel investors, this is absolutely a sector to not only have on your radar, but pinned to the top of your list.
The Research Team