The trend: AI startups are still amassing money in spite of the economic downtown, though investment interest seems to be narrowing within the subsector.
- Top trend: Investors are steering funds toward AI startups building accounting software.
- Globally, AI-driven accounting software garnered $233.3 million in VC capital between January and the end of March, which exceeds the $210.2 million received for all of 2021, per Wall Street Journal.
Top five AI startups to watch: The explosion of AI interest has translated into more entrepreneurs dreaming up how to apply the technology in new ways. But with a shaky economy, it’s becoming essential that startups find an AI niche with the most immediate market potential.
- Clari: This accounting AI startup is trying to help organizations get better revenue forecasting accuracy and shed light on deal progression. Clari just acquired Wingman to help customers spot revenue leaks based on recorded conversations.
- Databricks: For companies wielding messy data from multiple sources, this startup’s data lake allows users to input data in any format and get analytic insight outputs with efficiency. Databricks unifies data storage and AI on a single platform.
- Dataminr: This startup helps identify areas of risk for companies by digging through social media, blogs, information sensors, and the dark web to deliver alerts. It recently added geovisualization and intuitive crisis response features for customers who want to take action on risk alerts.
- AI21 Labs: An Open AI rival, this natural language processing (NLP) startup offers an AI-as-a-service platform where users can create virtual assistants, chatbots, content moderation apps, and other tools in high demand. In August, it also added a pay-as-you-go feature for developers.
- You: This startup built an alternative search engine that harnesses AI to understand search queries, rank results, and translate queries into different languages, including programming languages. It also offers information summaries discovered in searches and offers built-in apps for conducting searches on specific platforms like Twitter.
The bigger picture: With the economy weighing on people’s minds, AI startups aimed at helping boost revenue and slashing expenses will get an initial boost in investor interest.
- With growing awareness about the increasing role AI will play across industry operations, startups applying AI to robotics, healthcare, agriculture, and marketing will likely gain investor confidence.
- A downtick in AI startups devoted to vehicle automation may be on the horizon as AV companies shift away from robotaxi deployment to the trucking industry.
- Given economic uncertainty, startups could take a nimbler approach and be ready to tweak the focus of their AI applications as needed.
Further reading: Discover more action in the AI world in our new Top Startups in AI 2022 report.