The report also notes a shift from acquisitions to investments due to regulatory scrutiny, with these companies participating in 208 VC deals in 2023. In 2024, they invested $24.8 billion in VC deals, surpassing the UK's annual venture investments. The focus of investments is shifting from infrastructure and foundational models to the application layer and applied AI. The ultimate goal for these companies is to be the first to achieve Artificial General Intelligence (AGI). However, their energy demands are increasing, rivaling those of small countries, necessitating investments in sustainable energy.
Key takeaways:
- The 'Magnificent Seven' tech companies (Google/Alphabet, Microsoft, Amazon, Nvidia, Meta, Apple, and Tesla/xAI) are heavily investing in AI and cloud infrastructure, with a combined annual investment of $400 billion.
- Regulatory scrutiny on M&A is shifting the focus to venture capital, with these companies participating in 208 VC deals in 2023 alone.
- There is a shift in investment focus from infrastructure and foundational models to the application layer and applied AI, with massive opportunities in sectors like healthcare, media, and manufacturing.
- The energy demands of these tech giants are so high that they are expected to consume up to 19% of the US national power usage, indicating a need for investment in sustainable energy sources.