Startups in the field of artificial intelligence It’s been a wild ride in 2023. Everyone and their grandmother have tried some sort of AI tool, startups in the space have raised valuations in 2021, and there has been High-profile closuresAnd, at the end of the year, we witnessed all the drama surrounding Sam Altman and OpenAI — as well as the New York Times’ lawsuit against the company.
With so much in the rearview mirror, it’s hard to predict what will happen to AI startups in 2024. But some people, like investors, make a living from smart bets, so TechCrunch+ recently asked more than 40 investors what they think about investing in AI. Like 2024.
Most investors told TechCrunch+ that they expect the current wave of funding to continue but are optimistic that the industry is moving beyond the initial hype cycle and moving toward a more sustainable business. They also believe that 2024 could see the beginning of a second wave of more vertical, sector-focused AI startups that move away from building layers on top of technologies from companies like OpenAI and Google.
Lisa Wu, a partner at Norwest Venture Partners, expects opportunities in the AI vertical to be particularly attractive this year. She believes there may be less risk in investing in these startups, as they are unlikely – or easily – replicated by legacy companies such as Microsoft and Google.
“These AI applications have deep fundamental knowledge of end-user workflows and access to industry-specific training data to make employees and teams more productive,” Wu said. “For example, law firms that make effective use of AI will be able to deliver their services at a lower cost, with greater efficiency, and with a higher likelihood of achieving positive outcomes in litigation.”