Last week I told you that AI is set to be our civilization’s greatest accomplishment (so far at least).
The excitement around AI is palpable and investor dollars are pouring into the space – doubling between 2020 and 2021. While we’re still early in our global AI boom, we’re starting to see the tech rolled out into daily life for businesses and consumers. We even have sightlines to greater adoption in the next decade.
The benefits of adopting AI are going to be bigger than we can imagine.
To illustrate how big, I recently had an interview with the famous journalist, John Burke. You can watch that here.
In a recent report, the consulting firm McKinsey estimated that the benefits of AI adoption will add up to $13 trillion to the global economy by 2030… amounting to 1.2% of additional GDP growth per year.
To put that in perspective the Gross Domestic Product (GDP) of the U.S. economy is $21 trillion.
If $13 trillion doesn’t rock your boat, PWC released a similar report recently estimating that the global gains from AI adoption by 2030 could be as high as $15.7 trillion!
The huge economic gains from AI adoption are going to affect every sector of the economy. But, there are a couple of areas where AI adoption is going to have an outsized impact and I want to walk through three of these this week.
Autonomous Vehicles: Better Than Flying Cars
Back in the 1950s and 1960s every book and movie imagined flying cars as the future of transportation. While flying cars might very well be part of our future, (with multiple startups working on development) the truth is that autonomous vehicles – also known as “self-driving cars” – are going to be far more transformative.
Experts estimate that the broad-based adoption of autonomous vehicles will result in as much as $800 billion in gains in the U.S. economy alone.
Aside from the economic gains, there are benefits to human life.
Did you know that over 40,000 people die in the United States every year and over 1.3 million globally in road accidents? Another 4-plus million people globally are injured significantly enough in road accidents to need medical attention.
Autonomous vehicles could eventually significantly reduce those numbers.
Dozens of startups are working on building autonomous vehicles for use everywhere… from agricultural fields to highways and in the air. In fat, at Wavemaker Labs we are building three different autonomous vehicles companies:
- Graze: Building an autonomous lawnmower for the commercial landscaping industry (check out our crowdfund here)
- Abundant Robotics: Building an autonomous harvesting robot for the apple-picking industry (check out our crowdfund here)
- Future Acres: Building an autonomous robotic harvest companion for making crop transport in fields more efficient
While there is much work left to still do before we can safely put autonomous vehicles out into the world en mass, the technology is developing rapidly.
Excitingly there have already been some major exits for startups in this space… like Intel’s mammoth acquisition of Mobileye for $15.3 billion and General Motors acquisition of Cruise for a rumored $1 billion.
Computer Vision: Teaching Computers to See
When most people think about AI, they imagine intelligent computers with personalities that can talk to them like Siri or Jarvis (from the Ironman movies). While there one day might be consumer AI products like this, the reality is that AI often looks very different than that slick image.
One of the most exciting areas of AI is “computer vision” – teaching computers how to see.
It turns out teaching computers to detect, identify, and classify objects and phenomenon in videos and images is a technology with far-reaching consequences.
But my personal favorite example of AI at work is from Miso Robotics – a company I helped co-found. Our Flippy 2 robot wouldn’t be able to flip burgers and work a deep fryer without highly accurate and precise computer vision tools. It just wouldn’t be possible at all.
The applications for computer vision are vast and we’ve just now seeing the tip of the iceberg of the real-world benefits of this skill. Given that, it’s no wonder the computer vision industry is expected to grow from $9.5 billion as of 2020 to $41-plus billion by 2030. That’s more than 4x in a decade!
There are hundreds of computer vision startups in the world, some worth billions of dollars. However, when it comes to exits for computer vision startups, it will be a few years before we start seeing them given how fresh the technology is!
AI in Business: Greater Productivity
AI is going to have huge impacts on businesses around the world.
The information technology (IT) and internet revolutions were both transformative for how we do business and how businesses operate. Within a few decades businesses went from operating in paper, literally, to functioning on spreadsheets… from communicating by phone and fax to emails and instant messages.
This digitization brought huge gains in efficiency and productivity (and unbearable amounts of email at times).
AI is going to be a similar leap forward in productivity. In fact, it’s estimated that AI will increase labor productivity by as much as 40% in advanced economies in the next 15 years.
The emerging category of Enterprise AI companies working to build and deploy AI tools for businesses to use in their daily operations is growing steadily. The demands of businesses when it comes to AI tools is nearly unlimited in its variety and complexity.
Businesses in different industries, of different sizes, with different internal capabilities will all demand different types of AI tools to deploy as part of their business workflows. Today there are already hundreds of startups in this category.
Like with autonomous vehicles there have been some very promising early exits in the space such as C3.AI’s multi-billion dollar IPO and Microsoft’s $19.7 billion acquisition of Nuance Communications.
The widespread adoption of AI is going to bring trillions of dollars of economic benefits around the world.
No sector of the economy will be left untouched by AI.
Our excitement about AI at Wavemaker Labs runs deep and we’re building several companies in the space across agriculture, food tech, and autonomous vehicles.
I’ve been investing in AI for years but I know that this is just the beginning and there are going to be so many more great startups for me to invest in over the next decade.