A year ago, Silicon Valley was swamped. Shares of major tech companies were falling, the cryptocurrency bubble had burst, and a wave of layoffs had begun to sweep the industry.
And then came artificial intelligence.
Venture capitalists have been pouring money into AI startups by the bucketload since then, investing more than $11 billion in May alone, according to data firm PitchBook, an 86 percent increase over the same month last year.
Too many companies from Moderna to Heinz have reported AI initiatives. Artificial intelligence is one of the only areas where companies are still hiring and seem to be paying huge wages for the expertise. Workers are retrained to specialize in the field.
Tech stocks are rallying across the board, a swift return to growth when global analysts said a 10-year run of growth was coming to an end.
In 2022, the Nasdaq 100, a stock index dominated by the biggest tech companies, lost a third of its value, plunging 33% in a massive wipeout of wealth built up over the past decade. So far in 2023, the Nasdaq 100 is already up 31%… Start-ups are back to optimism again, at least those focused on artificial intelligence.
"VCs (venture capital firms) are competing for access to hot AI deals, shunning unprofitable conventional software companies," said PitchBook analyst Brendan Burke.
"AI startups experience founder-friendly conditions that don't extend to the rest of the tech ecosystem." About $12,5 billion in investment has gone into AI startups this year so far, compared to just $4,5 billion invested in the sector in all of 2022, Burke said.
Calling NVIDIA an “artificial intelligence chipmaker,” the article points out that on Friday NVIDIA's stock market valuation was $971,4 billion."
NVIDIA is now "one of the few companies in the world to reach $1 trillion in value."
