TLDR:
- Investment in AI start-ups surged to $24 billion in the second quarter of the year.
- Total start-up funding increased 16% sequentially to reach $79 billion in the same period.
With artificial intelligence (AI) becoming more integrated into everyday life, the demand for AI start-ups has seen a significant rise. Data from Crunchbase shows that investment in AI start-ups reached $24 billion from April to June, as reported by Reuters. This surge in funding has been attributed to the success of OpenAI’s chatbot and personal assistant ChatGPT, leading to increased competition in the AI sector.
The total start-up funding in the most recent quarter saw a 16% increase to reach $79 billion, with AI investments surpassing other sectors for the first time, followed by biotech and healthcare. Several start-up funds specifically focusing on AI have emerged, such as the OpenAI start-up fund, which invests in early-stage AI-related businesses in fields like education, law, and research.
One recent example is Hebbia, an AI start-up that raised $130 million in a Series B round led by Andreessen Horowitz, with participation from Index Ventures, Google Ventures, and Peter Thiel. Hebbia uses AI to analyze digitized documents and data sources, assisting in contract analysis by extracting and interpreting key information.
In India, the government has been prioritizing AI through its IndiaAI Mission, allocating over Rs 10,300 crore to empower AI start-ups and expand access to compute infrastructure. Some Indian AI start-ups include Krutrim, Sarvam AI, Mad Street Den, and Wysa.
