A recent AI paper was released by postdoctoral scholars at MIT Sloan about how startups can be more successful in AI

The paper and subsequent article by MIT Sloan magazine were really useful. The key points were:

• 92% of large companies are realising a return on their AI investments, and the same percentage is increasing their AI spending.
• To gain from AI, businesses must make substantial investments. Reduced investment does not affect revenue growth.
• The firms that increase AI expenditures by 25% see considerable gains
• Companies that invest less than 25% see very little growth.
• It requires time to see the economic benefit.
• There is a correlation between AI implementation and revenue expansion. The majority follow a J-curve, beginning slowly and steadily before growing substantially.
• Companies that invest less will find it more difficult to generate a profit, and it takes time to see a return.
• Smaller companies led by founder-CEOs with entrepreneurial experience are more likely to invest more capital.
• Bigger organisations and spinoffs from other businesses are less likely to embrace AI extensively.
• Investing in other complementary technologies, such as big data and infrastructure, contributes to achievement.
• The AI should be close to the product or service’s core offering. This will affect the company’s strategy for research and development.
• If development is not a company’s primary focus, it should investigate external opportunities.

Key thinking and insights

To make substantial returns, startups ideally need to invest sufficiently in AI. If there is less investment, there is considerably less chance of a gain. Companies should look at AI that adds value to their business and does not let them deviate away from their core objectives.

More information

• Paper on AI
• Article on AI

Please note

I have no affiliation with the companies/technology/people mentioned, and it is designed to highlight the thinking. This analysis is 100% independent for the benefit of the data/business community.

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