The world of startups have witnessed a revolution driven by Generative Artificial Intelligence (GenAI, its acronym in English) which, as in other areas of the economy, has played a prominent role.
According to a recent report from Accel, a venture capital firm, GenAI companies have been crucial in the emergence of unicorns — startups valued at more than $1 billion.
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Surprisingly, 60% of new startups that have reached this milestone in recent times are powered by GenAI.
The United States currently leads the way in investing in GenAI startups, with more than $14 billion invested in the last 12 months.
However, it is important to highlight that a substantial part of this funding was directed to OpenAI, owner of ChatGPT, with a contribution of US$ 10 billion.
As funding stabilizes between the US and Europe, we are likely to see a scenario more balanced and promising for GenAI, shaping the future of startups and how we interact with technology.
Philippe Botteri, partner at Accel, noted: “A very limited number of companies have attracted a disproportionate amount of capital… the investment going into fundamental models — we’ll see about that to decrease".
A highlight of the report is the growing role of Europe and Israel in the GenAI landscape.
Funding for GenAI startups in Europe and Israel has reached around $1 billion over the past 12 months, indicating significant growth in these regions.
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Furthermore, Europe has surpassed the United States in the area of GenAI research, producing 50% more publications with a comparable citation rate.
Botteri, partner at Accel, foresees a balanced future in GenAI funding, in which the focus will shift to application development.
According to him: “In the future, money will be directed more towards application development, so we will reach a more normalized balance, in which we expect a two-to-one ratio between the US and Europe”, he explains.
Furthermore, technology giants such as Microsoft and Nvidia are reaping the rewards of AI's potential.
Over the past 12 months, these companies have added an incredible $2.4 trillion to their market capitalization, demonstrating the substantial impact GenAI is having on the business world.
As funding stabilizes between the US and Europe, we are likely to see a scenario more balanced and promising for GenAI, shaping the future of startups and how we interact with technology.