Artificial intelligence startups 2023 has been a wild ride. Everyone and their grandma has tried some kind of AI tool, new startups in the space have raised funding at 2021 valuations, there have been high-profile closures, and then to end the year, we’ve got the buzz surrounding Sam Altman and OpenAI — and the New York Times’ lawsuit against the company.
With so much in the rearview mirror, it’s difficult to predict what will happen in 2024 for AI startups. But some people, like investors, make a living from smart bets, so TechCrunch+ recently asked more than 40 investors what they think AI investing will look like in 2024.
Most investors told TechCrunch+ they expect the current wave of funding to continue, but are optimistic the industry is moving beyond the initial hype cycle and toward a more durable business. They also believe that by 2024, a second wave of AI startups may begin to emerge that are more vertical, focused on specific areas, and no longer based on the technology building layers of companies such as OpenAI and Google.
Lisa Wu, a partner at Norwest Venture Partners, predicts that opportunities in vertical artificial intelligence will be particularly attractive this year. She believes investing in these startups may be less risky because they are less likely (or easily) copied by legacy companies like Microsoft and Google.
“These AI applications have deep understanding of end-user workflows and can access industry-specific training data to improve employee and team productivity,” Wu said. “For example, law firms that effectively utilize artificial intelligence will be able to provide services at lower costs, with greater efficiency and with a higher chance of litigation outcome.”
