Companies with exclusive and high-quality data sets have an advantage in developing accurate and specialized AI models.
Corporate venture capital plays a crucial role in the AI industry by validating new technologies and creating competition.
Thorough due diligence and understanding emerging trends are necessary for successful AI investments.
Deep dives
Bank of America's expansion in Paris following Brexit vote
Vanessa Holtz, CEO of Bank of America Securities Europe SA, ensured seamless service to European clients as the bank expanded in Paris after the Brexit vote. The bank aimed to be a one-stop shop and bring Bank of America's full range of services to clients.
The impact of AI on investment in the tech industry
The interest and investment in AI technology continues to grow, with companies investing in AI internally and investors looking for AI-related opportunities. The arrival of AI has disrupted the traditional tech industry, changing the way businesses operate and the skills that are in demand.
The importance of data and proprietary data sets in AI
In AI technology, reliable and proprietary data sets have become invaluable. Companies with exclusive and high-quality data sets, such as banks, insurers, and healthcare systems, have an advantage in developing accurate and specialized AI models. These data sets are essential for training and inference in AI applications.
The Importance of Corporate VC in the AI Space
Corporate venture capital (VC) plays a crucial role in the AI industry. By investing in early stage companies, corporate VCs help validate new technologies and create competition. This benefits both the founders and independent VCs by driving up valuations and increasing the chances of successful exits. For example, the company Runway ML, which uses cutting edge models to generate videos, received a $140 million investment from Google, Nvidia, and Salesforce. This not only validates their technology but also sets up a competitive dynamic for future acquisitions.
Navigating the AI Investment Landscape
Investing in AI requires thorough due diligence and an understanding of emerging trends. While competition in the AI space is fierce, finding the next wave of opportunities is key. This involves looking for founders with credibility in academic research and published papers and evaluating the potential of their technology. Application-focused companies, beyond those offering mere features, are particularly attractive. Additionally, investing in infrastructure companies like Cloudflare, which hosts AI models at the network edge, can be a lucrative strategy. It is important to stay ahead of the curve and identify emerging trends before they become fully priced in the market.
We're in the midst of an AI mania of sorts. In public markets, investors are placing bets on the companies perceived as being the winners of this new wave of computing. Companies that aren't even in "tech" are touting their AI bonafides. And of course, in private markets, every venture capitalist suddenly seems to be pivoting to AI in some way or another. But who will actually win? Will it be the big incumbents? Can those incumbents be disrupted? Will it be the companies who have access to unique datasets? Or will it be whoever has the most computing power? On this episode, we speak with Josh Wolfe, co-founder of Lux Capital, who has been investing in the space for several years, long before it was trendy. He talks about where he's placing his bets and how he's thinking about identifying winners.
