While generative AI chatbots have been dominating the headlines since the launch of ChatGPT in late 2022, the future of AI is expected to move in a different direction. What some refer to as “screen AI” will evolve and lean more on “physical AI” which is AI embedded in robotics, IoT devices, on mobile phones, in laptops and at the edge. In essence, AI everywhere.
In this way, AI will follow the same pattern as other technologies throughout the history of computing – moving from a centralized to a decentralized structure, much like how the advent of supercomputers and mainframes gave way to PCs, laptops, and mobile devices over the last several decades.
Due to growing power demands and increasing latencies in the cloud, highly centralized AI is not sustainable for all types of computing. Thus, the future of AI will be highly distributed and highly decentralized, and founders must have this in mind as they develop not only their technologies, but also their product-market-fit and go-to-market strategy as they look to unlock the next round of funding.
AI is Different, Real and Happening Now
So, what are VCs looking for in a startup as they make decisions about how to invest with this vision of the future of AI in mind?
VCs we’ve spoken with recently agree that the rise of AI is fundamentally different from past tech boom and bust cycles, and that AI is here to stay. VCs note that AI, as a technology and as a game-changing moment, is different, real, and happening now.
AI has the ability to process massive amounts of data quickly, but VCs say to become valuable and profitable as a business, startups need to pair their AI technology with proprietary, or semi-proprietary data. Early-stage investors tend to favor startups geared towards fields such as healthcare and financial services rather than those directed at verticals like legal, accounting and sales development because without proprietary data, a startup’s product-market-fit and future success in these areas is more difficult to determine.
Putting the Founder Forward
One of the central pillars of the Intel Ignite program is helping founders tell their stories and develop their narratives of their companies and themselves. VCs place a great deal of importance on storytelling for startups too, and they urge entrepreneurs to remember to put themselves forward and talk about what makes them uniquely qualified to build a business in their specific space. To many VCs, two things matter – market and team, and being able to communicate the founding team’s unique insight is key to getting buy-in from investors and to building the team’s product, bringing it to market and eventually, to scaling the company.
VCs also urge founders not to focus too much on their product, because, put simply, the product is not the company. What does this mean in practical terms? Instead of spending most of their pitch describing their product, VCs advise founders to put their product in the context of the problem being solved and describe the best product-market-fit for their platform.
Seed to Series A: Build a Machine That Sells
Another central aspect of the Intel Ignite program is helping founders get from Seed to Series A. It’s a move that entrepreneurs often find challenging because doing this requires a radical shift in mindset for founders.
The difficulty that founders face, even in the best of economic times, is to make the transition from selling to trying to build a machine that sells. In other words, startups run on acts of individual heroism, while businesses run on systems and processes that produce predictable outcomes, and there comes a point as startups scale, when founders must make that transition, and most of the time, it can be a difficult one.
As a founder, thinking systematically about the way you execute your strategy and tasks can help with this change – it’s a necessity for founders at Series A to have predictable systems and processes that enable them to scale their revenue line. Otherwise, they’re simply pouring water into a leaky bucket.
Almost Every Company is Going to Need AI
AI may be the hottest thing in tech right now, but its importance and impact in industries other than tech cannot be overstated either. Not every problem needs AI to be part of its solution, but sooner or later, almost every company is going to need AI and some component of its solutions.
So, for founders, the opportunities are there and will continue to multiply but having insight into how your potential VC partners are approaching the technology, is invaluable.
For more on how Intel Ignite helps companies rapidly scale and evolve, check out Roseman Labs’ journey with us. We also invite you to help us ignite the future of world-changing tech. Follow us on social media – on LinkedIn here and on X @IntelIgnite.
