AI Index Shows Global Investment in AI Development Soaring

Financial investment in artificial intelligence is an essential contributor in progressing AI research and development. With the Stanford Institute for Human-Centred Artificial Intelligence (HAI) releasing their annual AI Index last month, graphs show the investment trends in AI development for 2021 and where money is being focussed and where it is coming from.

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The report shows that overall global investment in AI development has continued to skyrocket as has been the case over the past few years. Private investment has by far and away bolstered this rise in funding, investing a total of $93.5 billion last year. That figure is more than double from 2020,showing the biggest increase since 2014. The second largest amount of funding came from mergers and acquisitions at $72 billion, 3.3 times more than in 2020.

Not only do the stats indicate the number of investments in AI development have grown, but the amount of money being invested in these transactions has also increased massively. Companies in 2020 disclosed investments averaging around $50-$100 million. In 2021, these investments were more frequently somewhere between $100-$500 million. That’s an increase of 81.1%in a year!

However not all is on the up across the board. The number of newly funded AI companies has dropped from a total of 762 companies in 2020down to 746 in 2021. These figures form part of an ongoing trend since 2018 of falling numbers of investments in new AI companies.

Graphs included in the report demonstrate that geographically the United States received the most private investment in AI companies at a staggering $52.9 billion, over three times the amount received by China who comes in second place with $17.2 billion. In third position was the United Kingdom who received a total of $4.65 billion from private investment.

Focus areas receiving the majority of these investments were data management, processing, and cloud followed by Medical and Healthcare.

The figures show that funding in AI research and development is booming and now is an excellent time to be on board with these projects. However, continued decrease in numbers of newly funded AI companies suggest it is notsuch a good time to found one.

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