Generative AI investments hit a record high of $3.9 billion in Q3 2024, according to new figures from PitchBook. Venture capitalists are pouring money into startups developing generative AI technologies, with US-based companies attracting the majority of funding.
Despite concerns over reliability, copyright issues, and environmental impact, many investors believe generative AI will become integral to industries such as business analytics, creative services, and automation. Analysts predict that 60% of current skeptics will eventually embrace generative AI, even if they don’t realize it.
The rapid expansion of Generative AI is being driven by notable funding rounds, including Magic, a coding assistant startup secured $320 million in August, and Glean, an enterprise search company, which raised $260 million in September. Other investments include Hebbia, a business analytics firm, which drew $130 million in July.
However, the growth of generative AI also poses significant challenges, particularly regarding energy consumption. Companies deploying AI at scale will require massive data centers, consuming up to 20 times more power than traditional data centers. This could strain global electricity and labor markets, with greenhouse gas emissions projected to triple by 2030 if the trend continues unchecked.
In response, tech giants like Microsoft, Amazon, and Google are turning to nuclear energy to offset their environmental impact. Despite these efforts, investor interest in generative AI remains high, with companies like ElevenLabs and Black Forest Labs seeking funding for their projects.
Source: https://www.techradar.com/pro/AI-investment-isnt-slowing-down