How Companies Are Actually Spending Money on AI Now
Jan 23, 2025
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Eric Glyman, co-founder and CEO of Ramp, shares insights on corporate AI spending trends. He breaks down how major companies are directing funds towards AI giants like OpenAI and Anthropic, revealing the balance between expectation and reality. Glyman discusses AI's role in revolutionizing expense management and enhancing productivity across various sectors. He also highlights the transformative impact of AI on job roles, stressing the need for evolving skills amid these technological shifts.
Corporate investment in AI has surged significantly, with companies transitioning from experimentation to embedding AI into core operations for improved productivity.
The spending patterns on AI reflect a shift towards essential tools rather than experimental software, indicating deeper integration into business workflows.
Diverse sectors, including traditionally conservative ones like healthcare, are increasingly adopting AI technologies, reshaping job roles and required skills in the workforce.
Deep dives
AI as a Business Priority
A significant emphasis is placed on artificial intelligence (AI) as a primary focus among business leaders, with 89% indicating its importance according to recent research. Companies are investing heavily in AI, which is becoming a pivotal element in the market landscape. This investment is expected to correlate with actual productivity gains; however, the current level of overall productivity improvements has raised questions about the sustainability and effectiveness of such spending. Leaders are contemplating whether the hype surrounding AI will translate into tangible outcomes for companies, shaping future investment decisions.
Rising AI Spend and Market Trends
There is a noted increase in corporate spending on AI, with some firms reporting up to four times more expenditure on AI-based products compared to previous years. Companies are moving from experimental use to operationalizing AI technologies, integrating them into core processes. Insights from spending management platforms reveal that growth in AI investment is not just about upgrading current systems but adapting to new operational realities. This shift indicates businesses are increasingly recognizing the value that AI brings to productivity and efficiency.
Shifts in AI Software Usage
Analysis of expenditure data shows a shift in the nature of AI products being purchased, moving from experimental software to essential business tools. For instance, the likelihood of firms maintaining subscriptions for AI services has increased dramatically, reflecting a trend where companies are now embedding AI tools more deeply into everyday operations. This change is leading to enhancements in productivity across various departments after initial trials become effective integrations into workflows. As businesses find effective use cases for AI, they are more likely to sustain spending on these tools well into the future.
Sectoral Insights on AI Adoption
Different sectors are experiencing varied rates of AI adoption, with technology firms typically leading the way, followed by unexpected sectors like newsrooms and sales teams. These industries are leveraging AI for tasks such as automating call notes and analyzing market signals to improve efficiency. Surprisingly, even traditionally conservative industries such as healthcare are beginning to embrace AI solutions in response to economic pressures. This trend highlights a fundamental change in how businesses across diverse sectors view and implement AI technologies.
The Impact of AI on Job Roles and Skills
The integration of AI into various business operations is also reshaping job roles and required skills across the workforce. While AI can automate lower-value tasks, it allows employees to focus on more complex and engaging activities, ultimately enhancing job satisfaction. The long-term implications of AI on job markets are uncertain, with a possibility of redefining roles as businesses become more efficient. There is an ongoing conversation about how the workforce will adapt to these changes and what skills will be necessary in an increasingly automated landscape.
In theory, all of this AI spending has to deliver some kind of return. Companies (or other end users) will have to get tangible value from its outputs in order to justify the billions spent on research, chips, energy, and more. So what's actually happening at the corporate level? On this episode, we speak with Eric Glyman, who is the co-founder and CEO of Ramp, which helps corporations manage their expenses. As such, he has front row visibility in terms of what's actually being spent and who is actually getting the money. We talk about trends he's seeing in terms of spending going toward companies like OpenAI and Anthropic, as well as how AI tech is affecting the operations of his own business.
