“There is simply no area of technology or business that is more important today than artificial intelligence,” says Jon Medved, CEO and founder of OurCrowd, the Jerusalem-based funding platform, announcing the launch of a dedicated OurCrowd AI Fund for accredited investors.
“It’s transforming the way we do everything,” Medved says. “Whether it’s how we’re entertained, how we learn, how we socialize, how we even grow our food, or manage our finances, or secure our data, AI is changing it all.”
Of the 81 AI companies in OurCrowd’s existing portfolio, eight have been acquired or had an IPO.
“Our advantage is that we’ve been investing in AI companies for 10 years,” Medved says.
Israel looks set to punch above its weight in the global AI ecosystem, earning a place of prominence as one of the leading centers of excellence.
“Israel will play a huge role in AI development,” Sam Altman, CEO and founder of OpenAI, said during a visit to Israel in June. Meanwhile, Nvidia recently announced that it is building one of the world’s fastest generative AI supercomputers in Israel.
OurCrowd’s presence in Israel gives it early access to emerging local startups before anyone abroad has heard of them.
“The application of AI to each business vertical will shape the economies of the future. The impact of AI is likely to be comparable to the introduction of computerization and, before that, electricity,” Medved says.
AI is the world’s fastest-growing investment sector. The rush of interest in ChatGPT and similar generative AI platforms has triggered a global wave of funding for the new technology.
“Artificial intelligence may be one of the biggest technological leaps in history. It is poised to unlock new business models, transform industries, reshape people’s jobs, and boost economic productivity,” Goldman Sachs says in a special report.
The AI and machine learning market reached $197.5 billion in end user spend in 2022 according to Pitchbook. Generative AI will become a $1.3 trillion market by 2032, rising at a compound annual growth rate of 42%, says Bloomberg Intelligence.
“The next wave of investment in AI will be in companies applying this new core technology to specific industry verticals that are likely to be revolutionized as a result,” Medved says. “There will be huge opportunities for investment which are not yet fully appreciated and are still valued at fractions of their potential.”
OurCrowd was an early investor in Hailo and NeuReality, two Israeli companies specializing in AI microchips that are now gaining serious traction. One of today’s AI startups could become the next Nvidia, which provides the heavy-duty microchips required for AI processing and whose share price has more than tripled in the past year to reach a market cap of more than a trillion dollars.
But for most people, there is no way to invest in startups directly. That’s where OurCrowd comes in. Through the platform, founded a decade ago, accredited investors can join funding rounds of individual startup companies from as little as $10,000. This enables OurCrowd members to invest alongside pension funds, institutions and industry leaders – giving access to opportunities that previously were not available to smaller investors.
OurCrowd also has dedicated funds that invest in a range of companies in order to diversify an investor’s portfolio and spread the risk, with participation from as little as $50,000.
The new AI Fund will invest in AI startups in Israel and abroad, with an additional focus on companies developing generative AI, also known as GenAI, across multiple sectors.
“50 years ago, we were looking at relatively straightforward automation – software that operates without human intervention – as a proxy for outsourced manual labor,” says Cali Chill, OurCrowd’s head of investment funds and chief legal officer. “About 20 years ago, development of AI became more prevalent, with software that learns and applies patterns, as a proxy for outsourced cognitive labor. The most recent GenAI trend introduced software aimed at creating new content, based on data. Companies have begun developing this most innovative tech as a proxy for outsourced creative labor.”
“Incorporating AI and GenAI tools within business processes will become a must, for all businesses,” Chill adds. “Be it an AI voice assistant that answers customer questions, AI-powered recruitment tools that support HR’s efforts to review resumes and screen candidates, or an AI ‘agent’ that analyzes procurement performance and cost optimization – adoption of machine learning and AI will become the new normal. Those who fail to explore the new wave of AI technologies will simply fall behind.”
OurCrowd recently opened Integrated Data Intelligence, a company in Abu Dhabi that provides AI technology for businesses, a $60 million joint investment with the Abu Dhabi Investment Office.
“We believe that the AI revolution is just getting started,” Medved says. “Whether it’s for infrastructure or for applications like AI for medicine, drug discovery, food, cybersecurity, fintech, legal tools and many other applications, we think that there are going to be some incredible companies that are being born now and our investors have the opportunity to invest early.”
For more information about the OurCrowd AI Fund, click HERE: