Artificial Intelligence, Virtual Systems and Big Data: Emerging trends for startups

As per my observation of last two years AI and Big Data are not considered as fancy recipe for startup business but would like to share here that almost all giant capital sources keep AI and Big Data as an option for their future investment.

Information technology is going to decide future through innovative approaches called Artificial Intelligence (AI) and virtual system (VS). Almost all top organizations, research centers and academic institutions are participating in it. And since 2009 all such groups have invested trillion dollars in these sectors.

One year old AI & Computer Vision startup from Chennai, Mad Street Den(MSD) has raised $1.5M (9cr.) from Reservoir Investments’ Exfinity Fund and GrowX ventures. Launched at MobileSparks 2013, MSD offers AI and Computer Vision as a plug and play solution to businesses around the world.

This year Silicon Valley fund invests Rs 84 crore in Indian artificial intelligence startup Capillary, Capillary builds artificial intelligence technology that helps retailers such as Benetton, Nike, Puma and restaurant chain Pizza Hut, understand and predict customer purchase behavior. The six-year-old company firm has now raised total funding of over Rs 180 crore from investors including Sequoia, Norwest and Qualcomm Ventures.

Infosys, long considered conservative when it comes to spending its substantial cash chest, has created a $500 million fund to invest in firms working in newer domains such as automation and artificial intelligence. Its recent $200 million acquisition of automation startup Panaya is only the beginning its CEO Vishal Sikka has been quoted as saying.

Infosys’ Bangalore rival Wipro has set up a $100 million corporate venture fund in Silicon Valley. India’s largest IT services provider TCS has screened over 1,000 startups in India, Israel, and Silicon Valley in its hunt for the next big idea, and will eventually choose a few startups’ solutions to take to their biggest customers.

Tata Communications has also co-invested in San Francisco-based artificial intelligence start up Sentient Technologies and become a preferred provider to Sentient for services such as data centre space, managed hosting and network services.

SAP, the $20-billion German enterprise software maker, plans deeper engagement with technology startups in India by investing in these firms. Its ‘Startup Focus’ is a global programme to help promising startups in the big data, predictive and real-time analytics space to develop new applications on its HANA technology platform.

Top brands like Microsoft, Apple, Facebook and Google have recruited researchers to join their in-house AI research teams. IBM, Yahoo, Intel, Dropbox, LinkedIn, Pinterest and Twitter have all purchased AI companies since last few years. Dell has also launched Alienware Virtual Agent that provides outstanding visual aid. Private investment in the AI sector has been expanding 62 percent a year on average for the past four years, a rate that is expected to continue. On May 2013 Google, NASA and Universities Space Research Association entered in a joint venture to launch Quantum Artificial Intelligence Lab. On July 2014 Microsoft has informed that it is working on a project called “Adam” to challenge Google brain (an unofficial name for Google’s AI project). Facebook has bought Oculus VR, the virtual reality company for $2 billion, before this IBM’s Watson computer has already surprised us by winning quiz show against human competitors. In March 2012, Amazon.com acquired Kiva Systems for $775 million, the second largest acquisition in its history and Amazon currently uses some 1,000 robots of Kiva Systems in its warehouses, now CEO Bezos has said the number will be closer to 10,000 by the end of this year. The world’s largest manufacturing company, Foxconn, is also investing very heavily in robots. The first 10,000 of its “Foxbots” were deployed around the same time Amazon bought Kiva, and Foxconn has been reported to be working closely with Google’s new robotics effort. Google has also acquired Boston Dynamics — the robotics and engineering company famous for the creation of some of the world’s most advanced robots, including BigDog, Cheetah, Petman, and Atlas. This brings Google’s total number of robot-related acquisitions to eight, and the company now has teams of robotics experts in California and Japan. Following the Boston Dynamics acquisition, Google says that it plans to honor its existing contracts, including the military contract with DARPA (Defense Advanced Research Projects Agency) which means we will see many other surprising projects!!

There is a rapid growth in demand of big data professionals in the market that led most of the B-Schools to include big data related programs in their syllabus, the University of Southern California’s Marshall School of Business began its Master of Business Analytics program, in an interview Amy Hillman, dean at Arizona State University’s W.P. Carey School of Business, said interest in a year-old master’s program in business analytics has spread “like wildfire.”, Northwestern University’s Kellogg School of Management offers several courses in analytics and in India as well many schools have introduced formal courses in analytics. Leading institutes in this field are IITs, SP Jain Institute of Management & Research, Mumbai and the IIM-B, which, jointly with SAS Institute, has floated an executive program on Analytics. According to a recent study by Gartner 4.4 million IT jobs worldwide will be needed to support big data by 2015. That’s a lot of potential employment for the right people.

Because of its strong analytics capabilities the big data is also considered as new and another form of artificial intelligence. In India, there is a good scope for startups dealing with AI, VS and Big Data.