Investment in AI Start-Ups Surges to $24 Billion in Second Quarter: Report

With artificial intelligence (AI) being a significant part of our lives, AI start-ups are also in high demand. Data from Crunchbase shows that from April to June, investment in AI start-ups grew to $24 billion. This is as per a report by Reuters. 

After the success of OpenAI’s chatbot and personal assistant ChatGPT, the competition to adopt AI has been increasing rapidly. In the most recent quarter, total start-up funding increased 16 per cent sequentially to reach $79 billion, according to the report. 

This is mostly due to investments in artificial intelligence (AI), which for the first time surpassed all other sectors in terms of size, followed by biotech and healthcare. 

To add to it, several start-up funds solely focusing on AI have also come up. One such example is the OpenAI start-up fund; it's a venture fund. It invests in early-stage, usually AI-related businesses in the fields of education, law, and research. The tagline of the company says, “Investing in start-ups with big ideas about AI.” 

One of the recent fundings for an AI start-up is that of Hebbia, which raised $130 million at a valuation of $700 million. As per TechCrunch, the Series B round of the start-up was led by Andreessen Horowitz, a venture capital firm. It also saw participation from Index Ventures, Google Ventures, and Peter Thiel. 

With the help of AI, the start-up analyzes several digitized documents, data sources, and others. As per Cruchbase, “Hebbia assists in analyzing contracts by extracting and interpreting key information.” 

Now, if we shift our focus to India, the government has been focusing on AI with its IndiaAI Mission. Under the mission, the government also approved over Rs 10,300 crore to empower AI start-ups and expand compute infrastructure access. Some of the Indian AI start-ups are Krutrim, Sarvam AI, Mad Street Den, Wysa, and others.