In a report by venture capital firm Accel, it is highlighted that Generative Artificial Intelligence (GenAI) companies have become the primary catalyst for the emergence of unicorn startups, constituting 60% of new unicorns.

According to the venture capital firm Accel, GenAI startups are the primary force behind the emergence of unicorn companies

In this image captured on June 23, 2023, you can see artificial intelligence (AI) symbols or characters arranged on a computer motherboard

The report also reveals that funding for GenAI startups in Europe and Israel reached nearly $1 billion in the past year, in contrast to the over $14 billion in the United States, although this figure is influenced significantly by a $10 billion investment in OpenAI.

“A significantly small group of companies have garnered a disproportionate share of the funding… the investment in the fundamental models is expected to decrease,” commented Philippe Botteri, a partner at Accel, during an interview.

AI foundational models, which are created by entities like Microsoft-backed OpenAI and Meta, possess the ability to generate text, images, or various media formats in response to specific requests.

The report indicates that Europe, where AI startups like Synthesia and Stability AI are thriving, is already generating 50% more AI-related publications than the United States while maintaining a comparable citation rate.

“In the upcoming years, there will be a shift in funding towards companies like Synthesia, focusing on application development. This will lead to a more equitable distribution, where we anticipate a two-to-one funding ratio between the United States and Europe,” commented Botteri.

As per the report, by the end of the third quarter, tech behemoths like Microsoft and Nvidia had collectively accumulated $2.4 trillion in market capitalization over the past year, primarily driven by the promise of AI.

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Botteri anticipates that AI applications tailored for specific fields such as cybersecurity, healthcare, construction, and the legal sector will become increasingly popular.

Reported by Supantha Mukherjee in Stockholm, edited by Deborah Kyvrikosaios Our Standards: The Thomson Reuters Trust Principles

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