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AI Trends That Matter To A VC

Every decade a technology arrives that fundamentally changes the way we live and work. The 90’s brought us the internet, which unlocked new ways to communicate, seek information and do business, and ultimately jumpstarted a period of economic prosperity rarely seen. We witnessed the same with the introduction of smartphones 10 years ago.  Now, we’re seeing more evidence to prove that Artificial Intelligence (AI) will be the fundamental technology of this decade and perhaps even our generation.

Early breakthroughs have demonstrated how AI will change the way we live and work. For example, computer vision and control systems have become so precise that they can drive cars for hundreds of thousands of miles free of accidents. Speech recognition technology now enables machines to hear and transcribe speech better than humans can. Not to mention, machines have developed evolving and intricate strategies to beat human experts at games requiring intuition and intelligence, like Go and Starcraft.

Still, we’re only scratching the surface of what’s possible in AI – many new problems and applications are discovered every day that could represent a significant opportunity for the companies that solve them. Understanding and reasoning about written documents and unstructured data remains one such opportunity. For example, imagine a corporate law firm that employs a machine comprehension system to assist with a difficult contract law case. Such a system could rapidly digest the full history of relevant rulings and then answer human questions about precedents. This type of application represents a massive opportunity when you consider that 80% of an enterprise’s data is recorded by humans, for humans—that is, in unstructured, natural-language text which cannot be analyzed by existing enterprise analytics products. Fortunately, startups and major technology companies like Google and Facebook have just started to tackle this key AI problem. In fact, a company we invest in, Maluuba, has seen early success in solving this fundamental challenge by building systems that can read Harry Potter books and the scripts of Game of Thrones to answer arbitrary questions about them.

Through these emerging AI trends, we have a general idea for where this market is heading. In the short term, AI technology for sight and hearing will approach and surpass human-level competence. Some of this technology will be incorporated into commercial products like self-driving cars. Natural language technologies will evolve to be as good as today’s vision and audition systems, reading books of increasing length and complexity like a child progressing through grade school. Within the next three to five years, AI will become ubiquitous in our day-to-day lives, with virtually all the products and services we use being powered by some form of AI technology. Beyond that, all the basic human capabilities—vision, audition, understanding and communication through language—will be mastered and we’ll see products that incorporate multiple AI systems to solve challenging problems. We’ll soon get to a point where society will have adapted to this AI future, with laws settling long-standing concerns about how we, as humans, relate to AI.

While we haven’t seen any AI companies emerge as unicorns, there’s plenty of evidence to suggest it’s only a matter of time before this occurs. Still, there are rumblings of AI concepts that sound promising but are far from a reality. Futurists argue that by 2030 machine intelligence will surpass human intelligence—that we’ll enter a world where machines do our jobs and we will no longer need to work. However, this vision for the future is unrealistic based on the state of the art in AI and where the field is heading. While it is true that AI is increasingly capable of mundane daily tasks like driving a car, the broad skills and capabilities of humanity far outstrip even the most optimistic trajectories for the field. We don’t know yet how to teach AI systems to mimic many of the qualities that make us human, like creativity, consciousness, and morality—partly because we don’t yet understand these qualities scientifically.

Artificial intelligence has captured the attention of the media, with Fortune 500 companies making significant investments in the space. General Motors’ $1 billion acquisition of AI company, Cruise Automation, is one recent example of the incumbents making big bets. Clearly, AI is more than simply another technology fad that will fade away in due course. It is a paradigm that will fundamentally change the way we live and work, now and well into the future.

It’s these opportunities that make me excited to be an investor in the AI space.

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