🏄The Next 12 Months in AI

An AI-focused VC's 10 prediction for the near future of AI

Author

Marc Csuzi
October 18, 2023

Hello Surfers🏄! 

Today we look into the glass bowl of a VC and try to see the future of AI. Let me know your predictions, I would love to hear what you envision unfolding in the next year.

Here’s your two minute of AI news for the day:

ONE PIECE OF NEWS

📈An AI focused VC predicts the next 12 months in AI

Air Street Capital, a VC specializing in AI investments, just dropped their 6th annual State of the AI report. They've made ten bold predictions for the next 12 months in AI.

Let’s dive into what future headlines will be all about, according to experts:

  1. Generative AI in Film: A Hollywood-grade production makes use of generative AI for visual effects.

  2. AI Misuse:A generative AI media company is investigated for its misuse in the 2024 US election circuit.

  3. AI Agents: Self-improving AI agents crush current ones in a complex environment (e.g., AAA game, tool use, science).

Meaning: AI agents that can teach themselves without human assistance will surpass the current best-performing models or methods in playing games like Minecraft or GTA-V, helping scientists find breakthroughs, etc.

  1. Tech IPO Surge: We see at least one major AI-focused company (e.g., Databricks) go public.

  2. Expensive AI Training: The scaling race between LLMs will push through the $1B price tag to train a single large-scale model.

  3. Regulatory Investigation: The US or the UK will investigate the Microsoft/OpenAI deal for potential antitrust concerns.

  4. AI Governance: We see limited progress on global AI governance beyond high-level voluntary commitments.

  5. GPU Debt Funds: Financial institutions launch GPU debt funds to replace VC equity dollars for compute funding.

Meaning: Instead of tech companies giving away equity to fund their computational needs, they might borrow money via GPU debt funds. Investors in the debt fund earn returns based on the interest from the borrowed amount. This could be an innovative way to finance the growing computational needs of the AI sector.

  1. AI Music:An AI-generated song breaks into the Billboard Hot 100 Top 10 or the Spotify Top Hits 2024.

  2. AI Hardware Acquisition: As AI processing demands grow, a significant AI company, possibly OpenAI, will buy a company that specializes in AI-optimized hardware.

Based on these predictions Air Street Capital expects that regulators will try to keep AI on the straight and narrow, but they seem to be skeptical about progress on global regulation. I'm on the same page here. The possible gains outweigh the risks for countries right now, so the global race will only intensify.

The investment scene is getting a makeover. Smaller AI entities might start seeing a cash influx, and startups could ditch equity deals for straight-up loans to fuel their AI dreams. However, this largely depends on the global financial markets and whether inflation and interest rates finally start to decline.

The most important prediction and main breakthrough would be the predicted progress on AI Agents. If they blow past today's benchmarks in gaming, tools, and science, it could herald a seismic shift in technology.

What are your thoughts on it? 

I’m thinking about sharing my own list of predictions, but I would love to hear what yours are. Hit reply and let me know and I might highlight the best answers.

ONE MORE THING

The US escalates tech battle by cutting China off from AI chips

As predicted in last Thursday’s newsletter. In a sweeping move, the US has rolled out an updated AI chip ban, barring Nvidia from shipping its GPU’s to China.

But this isn't just about China. The reach of the new regulation stretches way beyond, now covering mainland China and Macao, and extending its grip to 21 additional countries. The list includes nations under the US arms embargo, with notable mentions being Iran and Russia.

US chipmakers felt the tremors immediately after the announcement. Nvidia's stock took a hit, closing 4.7% down, while Intel slipped 1.4% and AMD shares ended 1.2% lower.

⌚ If you have one more minute:

  • How Generative AI Will Change the Way You Use the Web, From Search to Shopping - WSJ

  • AI Chatbots Can Guess Your Personal Information From What You Type

  • YouTube launched Spotlight Moments: AI-powered ad solutions

  • GPT-4 is Getting Faster

AI Art of the day 🎨

Funny toy ideas by ChatGPT and DALL-E 3 user u/Status-Shock-880.

The prompt was: “Let’s do an image of a toy package of a product that could never exist, with people on the front using it and a funny product name”

🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄🌊🏄

That’s it folks!

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