AI startups are creating high value across a wide variety of industries.
What’s new: CB Insights, which tracks tech startups, published the latest edition of the AI 100, its annual list of 100 notable AI startups. The list includes companies in healthcare, retail, transportation, finance, construction, media, and manufacturing. (Disclosure: The list includes Landing AI, where Andrew Ng is CEO, and Bearing.ai, a portfolio company of AI Fund, the venture studio that he leads.)
Early-stage stars: The authors considered 7,000 private companies headquartered around the world. They selected outstanding entries based on the factors that include number and types of investors, research and development activities, market potential, sentiment analysis of news reports, plus a proprietary score related to the startup’s target market, level of funding, and momentum.
- The authors divided the list into companies that serve a particular industry, multiple industries, and other AI developers. The largest number of companies, 10, serve healthcare. Seven companies are in the finance and insurance, and six are in retail.
- The companies have raised a total of $12 billion since 2017. Several have raised over $1 billion alone including autonomous vehicle firm Nuro and pre-trained model provider SambaNova Systems. Thirty-nine are in an early, pre-Series B stage.
- The list contains startups headquartered in 10 countries, including 73 in the U.S. The UK and Canada come in a distant second and third, with 8 and 5 entries, respectively.
Blasts from the past: Many of last year’s AI 100 continue to gain momentum. They’ve raised $6 billion in aggregate since April 2021. Six are valued at over $1 billion, and nine were acquired or offered shares to the public. (See The Batch’s coverage of the AI 100 in 2021 and 2020.)
Behind the news: CB Insights’ recent State of AI report highlighted trends among AI startups during the first quarter of 2022.
- AI firms raised around $15 billion between January and April — less than in any quarter in 2021 but still more than in any prior quarter. U.S. companies more than $9 billion, companies headquartered on the Asian continent nearly $4 billion, and European companies raised most of the rest.
- Most of the total funding went to Series A rounds or earlier. Later-stage startups, however, proceeded through Series C and D rounds more quickly than at any time since 2018.
- This year’s first quarter saw 52 exits, significantly fewer than in any of the previous three quarters.
Why it matters: The AI 100 confirms that AI is finding valuable applications beyond the technology’s stronghold among consumer-internet companies. It also highlights hot sectors for both entrepreneurs and funders. Healthcare and finance are perennial favorites among investors, while automation for warehouses and logistics receive steadily growing attention.
We’re thinking: Investors, take note: U.S. companies received the lion’s share of AI startup funding, but the rest of the world is a rich source of talent for both existing startups and those yet to be formed.