How AI is Transforming Every Industry: The Investors Perspective

Kanika MAYAR | 01 Apr 2024

This is adapted from Entrepreneur India

A recent study conducted by IBM revealed that over 59% of India's enterprise-scale companies (over 1,000 employees) actively use AI in their operations. Early adopters are setting the standard, according to the "IBM Global AI Adoption Index 2023," with 74% of Indian firms already using AI and having increased their investments in the technology over the previous 24 months in areas like workforce reskilling and research and development.

During a panel discussion on 'Investors Perspective on AI', at the Tech and Innovation Summit in Bangalore, organised by Entrepreneur Media, various investors came together to share their perspective.

The biggest application of AI nowadays, according to Manoj Agarwal, Co-Founder and Managing Partner of SeaFund, is in customer experience. "The data showed us that about 38% of usage revolved around customer experience. Similarly, in health care and various other areas, the use of AI will grow in applications," he said.

Shubham Sandeep, Managing Director, pi Ventures, feels that ten years ago, cloud computing was a thing. Now every enterprise is a cloud-native company. "In the next five to seven years, every enterprise and every startup will be an AI-native startup."

The US is currently the home of artificial intelligence, claims Kanika Mayar, Partner, Investment, Vertex Ventures. "The majority of founders in India and Southeast Asia look to the US for ideas and inspiration because a large portion of deep tech research has its roots there," she said.

Currently, Sandeep is focusing on three main themes: AI tooling and infra. The second is foundation models, and the third is Edge AI. He emphasised that data security is going to be a challenge. "I think all nations will insist that all data flowing through foundation models reside in local data centres," he said.

Manoj claims that the government is acknowledging AI as a significant advancement. "There was an announcement by the minister for an INR 10,000 crore fund for AI to invest in infrastructure and in technologies, which is a positive sign," he remarked.

As far as the regulations are concerned Mayar sees this as a sign of improvement. According to her, regulation is starting to come in, which is actually a positive sign. "It means that there is enough activity now in the ecosystem that the government needs to think about it. If you look at all the other sectors, whether it's IT services, automotive, or energy, the government has largely been an enabler."

Investors also feel that India has to be careful in terms of what it regulates and what it doesn't. "I think if you try to cuff the hands of founders and enterprises, then a lot of the talent will actually move out and start winning. And we've actually seen that a lot of the infra and tooling companies either move to Singapore or the US," added Sandeep.

AI SaaS, or AI infrastructure, according to Sandeep might be the next big thing that the Indian tech industry exports to the rest of the globe, given the talent that India possesses and the abundance of capital that is chasing these founders.

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