Artificial intelligence (AI) has become a solution to tackle some of the world’s biggest challenges such as anticipating cybersecurity threats, detecting natural disasters or treating chronic diseases.
The creation of AI tools such as OpenAI’s ChatGPT and Stable Diffusion has given visibility to AI, which is becoming more and more popular, and, consequently, is changing how all companies do business.
AI in businesses
Artificial Intelligence (AI) focuses on the creation of smart machines that can “imitate” human actions. This way, through AI we could (and we are already) launching efficient and accurate machines or apps that can help us to do a great variety of tasks.
In fact, AI is already present in our everyday lives, for instance, with apps such as Siri or Alexa, but it is also driving us into the future, for example, with the creation of autonomous vehicles. As a result of the development and the potential applications of AI, many tech companies are investing in this field.
Nowadays, a growing number of companies worldwide are applying AI in their businesses to make things more efficient. For instance, from 2015-2019 AI services increased by 270%, and this number is still on the rise.
In Europe, the European Commission promotes AI developments through Digital Europe, which is the latest funding programme launched by the EU that intends to bring digital technology to businesses, citizens and public administrations.
With a budget worth €7.5 billion, it plans to shape the digital transformation of Europe to benefit SMEs. The programme provides support in several areas, being artificial intelligence among them.
AI investments in the last ten years
From 2012 to 2020, investments in AI companies have increased drastically: from $3B in 2012 to almost $75B in 2020, being the US and China the main investors in AI, followed by the EU.
According to Dealroom, $24bn were invested in AI in 2020 in Europe, and $39.2bn in 2021. However, in 2022 only $23.1bn were invested in this field, which has meant a slight decrease in European AI investments. This drop is partly driven by the growing interest of VCs in blockchain technologies, Web3 and metaverse during 2022.
Will 2023 be the year of AI?
Plans for AI in 2023
This year, Google intends to launch an AI chatbox, Bard, and will implement AI in its search engine. It has also invested $300 million in AI startup Anthropic, which shows how heavily Google bets on AI.
Similarly, last month Microsoft announced the launch of an intelligent chatbot that will summarize web pages, compare different sources of information, compose emails, and more. Also, the company has invested several billion dollars in OpenAI after the success of ChatGPT.
In addition, the US and the EU have decided to join forces to boost the use of AI in areas such as agriculture, healthcare, emergency responses, climate forecasting and electricity. Through this deal, data will be exchanged into a common AI model.
In September 2022, the European Parliament submitted the AI liability directive, which is a directive on adapting non-contractual civil liability rules to AI. However, new regulations are taking place in 2023, when the Commission will modernise the EU liability framework to introduce new rules specific to damages caused by AI systems. It intends to establish a common regulatory and legal basis for artificial intelligence in line with EU values, and it will gather specific applications and possible risks for AI.
Top 5 European AI investors in 2022
The EIC has shown an increasing interest in AI since in 2021 it launched a new platform based on Artificial Intelligence (EIC AI-Based Platform) so as to support the EIC Accelerator funding. This platform will make the information between innovators and funders more accessible and easier to understand.
In the last call of 2022, its budget amounted to €470 million of funding to support breakthrough projects. Given the potential applications of AI, in the EIC Accelerator October 2022 call, the EIC provided funding to several AI projects and companies, such as Deep Opinion, Oivi, or Neuron Sandware, among others. In 2022, the EIC funded 43 AI startups.
BpiFrance, France’s public investment arm, provides funding for disruptive SMEs and startups to boost the French economy.
They invest in a great variety of fields, being AI among them. In fact, one of the latest companies they have provided funding to is Previa Medical, a French company that uses AI to detect patients’ complication risks. The funding provided amounts to €2.1M.
In 2022, BpiFrance made 23 investments in AI startups.
The Austria-based VC company Speedinvest made 20 investments in the AI field in 2022. Their latest fund was announced on Dec 13, 2022 and raised a total of €500M. Speedinvest usually invests in seed-stage companies, and their typical ticket size is €700-€1.3M. In pre-seed rounds, they invest up to €1M, in seed stage, €3M.
Innovation Norway’s mission is to boost innovation and technological development in Norway. It has become the Norwegian Government’s most important funding instrument. In 2022, it made 19 investments in the AI field, such as Intoto, Sense task, or Völur.
The Berlin-based VC company btov Partners makes early-stage investments in digital and industrial technology companies.
Their latest fund was announced on Sep 16, 2021 and raised a total of $135M. In 2022, they provided funding to 14 AI companies. Among their investment portfolio, we find some AI companies such as Calvin Risk, Latticeflow or Zeitgold (acquired by Deel).