How To Create An AI (Artificial Intelligence) Startup

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According to research from IDC, the global spending on AI (Artificial Intelligence) is expected to hit $97.9 billion by 2023, up from $37.5 billion in 2019. This represents a compound annual growth rate of 28.4%.

No doubt, this is an enormous opportunity for startups. “These days, almost every company needs to leverage AI in order to thrive and build a meaningful future,” said Saar Yoskovitz, who is the CEO of Augury. “This is true for younger startups, and it is true for the largest companies, even in the most traditional and nascent industries like manufacturing and insurance. In a sense, AI has become another layer in the tech stack, like databases, and not a business model.”

All this is true. But then again, finding the right product-market fit is extremely challenging. Consider that AI models generally require a lot of customization. In fact, there is often much variation even for companies in the same industry. 

And yes, there must be a high-quality dataset. But of course, this is far from easy for a startup to develop.

“Data creates an interesting chicken-and-egg problem,” said Yoskovitz. “Without a customer, you don’t have data, which means you cannot train your algorithms. Without algorithms, you are not able to provide value to your customers and compete in the market. Therefore you will not have customers to provide data.”

What to do? You can look at forming partnerships, such as with companies that may not have strong AI capabilities. Or another approach is to create a free app that collects data.

Read more: forbes