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Investments in generative AI startups reached $3.9 billion in the third quarter of 2024

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Is OpenAI worth $100B?

Not everyone seems to be convinced about the return on investment in generative artificial intelligence. But many investors do, judging by the latest data from funding tracker PitchBook.

According to PitchBook, in the third quarter of 2024, VCs invested $3.9 billion in generative AI startups across 206 deals. (Not counting OpenAI’s $6.6 billion round). $2.9 billion of this financing went to U.S.-based corporations across 127 deals.

Big winners in the third quarter included coding assistant Magic ($320 million in August), enterprise search provider Glean ($260 million in September) and business intelligence company Hebbia ($130 million in July). Chinese company Moonshot AI raised $300 million in August, and Sakana AI, a Japanese startup focused on scientific discoveries, closed a $214 million tranche last month.

Generative AI, a broad cross-section of technologies that features text and image generators, coding assistants, cybersecurity automation tools and more, has its detractors. Experts query the reliability of this technology and – in the case of generative artificial intelligence models trained without permission on copyrighted data – its legality.

However, VCs are effectively betting that generative AI will gain a foothold in large and profitable industries and that the challenges it faces now is not going to impact its long-term development.

Perhaps they’re right. AND The Forrester report predicts 60% of generative AI skeptics will use this technology – consciously or unconsciously – for tasks starting from summarization to creative problem solving. This is a rather rosier result than Gartner’s forecast earlier this 12 months that 30% of generative AI projects can be abandoned after proof of concept by 2026.

“Large customers are deploying production systems that use startup tools and open source models,” Brendan Burke, senior emerging technology analyst at PitchBook, told TechCrunch in an interview. “The latest wave of models shows that new generations of models are possible that can excel in scientific domains, data mining and code execution.”

An enormous obstacle to the widespread adoption of generative AI is the enormous computational requirements of the technology. Bain analysts project in a recent release test that generative AI will drive corporations to construct gigawatt data centers – data centers that devour 5 to twenty times more energy than the average data center today – putting strain on an already strained labor and electricity supply chain.

There is already a requirement for data center power powered by generative AI extension life of coal power plants. Morgan Stanley estimates that if this trend continues, global greenhouse gas emissions by 2030 could possibly be thrice higher than they might be without the development of generative AI.

Several of the world’s largest data center operators, including Microsoft, Amazon, Google and Oracle, have announced investments in nuclear power to offset growing demand for non-renewable energy. (In September, Microsoft announced that it will draw power from the infamous Three Mile Island nuclear power plant.) But it could take years before these investments bear fruit.

Investment in generative AI startups shows no signs of slowing down – negative externalities be damned. ElevenLabs, the viral voice cloning tool, is reportedly searching for to lift $3 billion in funding, while Black Forest Labs, the company behind the notorious X image generator, is reportedly in talks for a $100 million funding round.

This article was originally published on : techcrunch.com
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Perplexity is reportedly planning to raise $8 billion in funding

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Perplexity AI logo is seen on a smartphone and on a PC screen.

AI search engine Perplexity is in fundraising talks and hopes to raise around $500 million at a valuation of $8 billion, according to the Wall Street Journal..

If the deal goes through on these terms, Perplexity’s valuation might be greater than double what it was at its $3 billion valuation obtained from SoftBank over the summer. According to WSJ, the corporate currently receives about 15 million inquiries a day and generates about $50 million in annual revenue.

Perplexity uses artificial intelligence to help people search the Internet using a chatbot-style interface. Some news publishers have accused the corporate of unauthorized web crawling and plagiarism, and The New York Times even sent Perplexity a cease-and-desist letter, but CEO Aravind Srinivas said he wants to work with publishers and has “no interest in being anyone’s business here.” antagonist.”

Fundraising talks began after OpenAI announced it had raised a $6.6 billion round at a $157 billion valuation. While products like OpenAI’s ChatGPT have blurred the road between chatbot and search engine, the corporate is moving more directly into search with SearchGPT.

Perplexity didn’t immediately respond to TechCrunch’s request for comment.

This article was originally published on : techcrunch.com
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DJI is suing the Department of Defense over the company’s listing as a Chinese military company

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DJI Mini 3 Pro drone

Drone manufacturer DJI filed a criticism lawsuit Friday against the US Department of Defense over its inclusion DoD list “Chinese military companies”.

A DJI spokesman said the company filed the lawsuit after “attempting to contact the Department of Defense for over sixteen months” and decided it had “no alternative but to seek relief from federal court.”

“DJI is not owned or controlled by the Chinese military, and the Department of Defense itself acknowledges that DJI produces consumer and commercial drones, not military drones,” the spokesman said.

The Chinese company was included on the Department of Defense’s 2022 list, following similar actions by other government agencies – in 2020 DJI was included on the list Department of Commerce Entity List this essentially prevented American corporations from selling it, and the following yr it was placed on the Treasury Department’s investment block list because of DJI’s alleged involvement in surveillance of Uyghur Muslims. (The company said it had “nothing to do with the treatment of Uyghurs in Xinjiang”).

In its lawsuit, DJI claims that as a result of the listing, it “suffered ongoing financial and reputational harm, including loss of business, and employees were stigmatized and harassed.”

The company says the Department of Defense report justifying the listing “contains a scattered set of claims that are completely inadequate to justify the designation of DJI.”

The lawsuit argues: “Among numerous deficiencies, the report applies improper legal standards, confuses individuals with common Chinese surnames, and relies on outdated facts and weakened ties that fail to establish that DJI is a (Chinese military company).” It also says that founder and CEO Frank Wang and three early-stage investors “collectively own 99% of the company’s voting rights and approximately 87.4% of its stock.”

The Department of Defense didn’t immediately reply to TechCrunch’s request for comment.

This article was originally published on : techcrunch.com
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Former OpenAI CTO Mira Murati is reportedly raising funds for a new artificial intelligence startup

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OpenAI CTO Mira Murati unveiling ChatGPT

Mira Murati, CTO of OpenAI, who announced her departure last month, is raising VC funds for a new AI startup, in accordance with Reuters.

According to reports, this startup will deal with constructing AI products based by itself models and will raise over $100 million on this round.

After her departure, Murati wrote in X that in its recent releases, OpenAI “has fundamentally changed the way AI systems learn and reason through complex problems.” She said: “I’m leaving because I want to create time and space for my own exploration,” but didn’t provide details of her plans.

Before joining OpenAI as vice chairman of applied artificial intelligence and partnerships in 2018, Murati worked at Tesla and Leap Motion. She was promoted to CTO in 2022, and was even named interim CEO through the transient ouster of co-founder and CEO Sam Altman.

Murati is considered one of several OpenAI executives who’ve recently left; OpenAI’s director of research and vice chairman of research announced their departures a few hours afterward. Per week later, OpenAI announced that it had raised $6.6 billion in the most important VC round of all time.

This article was originally published on : techcrunch.com
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