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VCs said AI Companies Require Proprietary Data To Stand Out From The Group

AI companies venturing capital dollars in 2024 and raised more than $100 billion. This increase is more than 80% in comparison to the 2023 record. It encompasses nearly a third of the total VC dollars which is invested in 2024. This is undoubtedly a lot of money funneling into a lot of AI companies.

 The AI industry has swelled up so much within the last two years and it become filled with overlapping companies. Startups are still using the AI just for marketing. Investors also have to work out for them when it comes to finding the startups that have the full potential to be the category leaders.

The latest survey results of 20 VCs give the ideas of the enterprise for the AI startups. Making it different compared to its peers. More than half of the respondents said this thing will give the AI startup an edge in the quality or rarity of the proprietary data.

Paul Drews, a managing partner at Salesforce Ventures, stated that it’s really hard for AI startups to have a moat because of the changing landscape. He also added that he looks for startups that have a variety of differentiated data, technical research like innovation, and multiple compelling user experiences.

Jason Mendel, a venture investor at Battery Ventures, then agreed that the technology moats are diminishing.

“I’m looking for companies that have deep data and workflow moats,”. “Access to unique, proprietary data enables companies to deliver better products than their competitors, while a sticky workflow or user experience allows them to become the core systems of engagement and intelligence that customers rely on daily.”

Having proprietary reach data becomes increasingly important for companies to build all kinds of vertical solutions. Scott Beechuk, a partner at Norwest Venture Partners, stated that the companies can hone in on their unique data. They have the startups with the most long-term potential.

Andrew Ferguson, a vice president at Databricks Ventures, stated that having rich customer data, and data creates a feedback loop in an AI system. These qualities make it more effective and can help startups.

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Avijit Sah

Avijit Sah is a digital marketing expert specializing in SEO, social media, and content strategy. With a passion for helping businesses grow online, Avijit Sah uses data-driven tactics to boost visibility and engagement. Follow Avijit for the latest digital marketing tips and insights.

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