However, the sector requires a long-term commitment, with AI investments predicted to reach $200 billion globally by 2025, according to Goldman Sachs. Bloomberg Intelligence estimates the market size to be $1.3 trillion over the next decade, up from $40 billion in 2022. Despite short-term overstatements, the long-term impact of generative AI is understated and will require time to mature and become accurate and safe, according to Tim Guleri, managing director at Sierra Ventures.
Key takeaways:
- Generative AI deals dropped 29% in the third quarter from the previous quarter with total deals valued at $6.1 billion, largely thanks to Amazon’s agreement with language model provider Anthropic.
- Big Tech has dominated the generative AI space, potentially scaring away investors and startups, and even saw a slowdown in dealmaking activities this year.
- There are opportunities in enterprise and arbitrage AI, with investors showing interest in companies focused on enterprise software-based AI and arbitrage AI relating to financial systems.
- AI investments are forecasted to reach $200 billion globally by 2025, and enterprises should be ready for a long-term commitment, with a planning horizon of 5 to 7 years.