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A forecast for investments in AI startups.

A forecast on investments in AI startups

By the end of 2026, more than USD 10 billion will have been invested in AI startups that rely on foundation models – large AI models trained on huge amounts of data, market research firm Gartner forecasts.

The company says that a recent poll of more than 2,500 executive leaders found that 45% reported that the hype around Generative AI ChatGPT prompted them to increase AI investments. 

70% said their organization is in investigation and exploration mode with generative AI, while 19% are in pilot or production mode.

Top trends impacting the future of data science and machine learning (DSML), including the focus shifts towards generative AI investments, according to Gartner:

Trend 1: Cloud Data Ecosystems
Data ecosystems are moving from self-contained software or blended deployments to full cloud-native solutions. 

By 2024, 50% of new system deployments in the cloud will be based on a cohesive cloud data ecosystem rather than on manually integrated point solutions.

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Trend 2: Edge AI
Demand for Edge AI is growing to enable the processing of data at the point of creation at the edge, helping organizations to gain real-time insights, detect new patterns and meet stringent data privacy requirements. 

More than 55% of all data analysis by deep neural networks will occur at the point of capture in an edge system by 2025, up from less than 10% in 2021.  

Trend 3: Responsible AI
Responsible AI makes AI a positive force, rather than a threat to society and to itself.

Gartner recommends organizations adopt a risk-proportional approach to deliver AI value and take caution when applying solutions and models. Seek assurances from vendors to ensure they are managing their risk and compliance obligations, protecting organizations from potential financial loss, legal action and reputational damage.

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Trend 4: Data-Centric AI
The use of generative AI to create synthetic data is one area that is rapidly growing, relieving the burden of obtaining real-world data so machine learning models can be trained effectively. 

By 2024, 60% of data for AI will be synthetic to simulate reality, future scenarios and derisk AI, up from 1% in 2021.

Trend 5: Accelerated AI Investment
Investment in AI will continue to accelerate by organizations implementing solutions, as well as by industries looking to grow through AI technologies and AI-based businesses. 

By the end of 2026, more than USD 10 billion will have been invested in AI startups that rely on foundation models – large AI models trained on huge amounts of data.

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