With the onset of the COVID-19 pandemic most tech-firms are claiming to be AI startup to keep pace with the changing technological trends. But if you are planning to invest, it is important to judge the company on the basis of their AI legitimacy.
Since, AI is the most sort after technology in the recent times, most companies deceive about the AI innovations just to attracted potential investors. According to a recent report, 40% AI start-ups do not actually use AI in their core functioning, business processes or even for decision making. The report also reveals that 26% of these companies use AI for chatbots and 21% use it for cyber-attack protection. Though chatbots and fraud-detection involves machine learning and rule-based algorithms, they cannot be termed as hardcore AI. Most companies use the term “AI-powered” just to go with the flow and impress the investors.
But if you are actually interested to put your money in a core AI based company, here are a few important things that you should keep in mind.
The authentic core AI-based companies will offer solutions based on technologies like NLP (Natural Language Processing), computer vision, recommendation engines and so on and not just plug and play AI model.
Keep a note of companies who are known to have human workers to carry our services which actually should be carried out through core AI tec kmhnologies. There are numerous examples, where companies involve human workers to book appointments and answer queries instead of chatbots. So, it is advisable to do a good research before you invest your money.
Many SAAS companies are also using “Artificial Intelligence” for their company though they are using data analytics for building applications and workflows. So, it is imperative for the investors to understand how the companies are implementing their AI models within the company and whether they are going anywhere beyond data analytics.
It is possible that investors may not have sound technological understanding to differential core AI from ordinary automation. To be double sure, before investing, it is important to know about the academic credentials and previous work experiences of the team of engineers currently employed with the start-up.
Before investing a large sum of money it is important to learn about the case studies of the company to find out about the authenticity of the company. This will help in understanding how the company is leveraging AI to solve actual business problems and adding values to their customer’s business.
The investors should also ensure that the AI startup have aimed their innovations to solve the right kind of business problems and they are following the right dimension to aggregate data to train their niche AI models. The investors must find out how transparent their advance machines are and how much human intervention is still required. Remember, the more the human intervention, the less is their AI capability.
No company can claim to be an AI company overnight. Being an investor, it is important to know how the advance their machines are getting augmented and how well they are learning from the data gathered. You can also ask the company about their data usage. A core AI company will be able to share the details about their data usage and about how they have evolved overtime.
Just terming the company as “AI” doesn’t make them authentic AI players. The venture capitalists and angel investors must abide by the above mentioned points to find the right investment options for better ROI generation.