The Business of AI Startups

Abstract

Increased computing power and advanced machine learning (ML) techniques have accelerated the development and use of “artificial intelligence” (AI). Despite the increased commercial focus on AI, we have limited information about how AI products are developed by resource constrained startups. We collect survey data from startups producing commercial AI products to provide a glimpse in how these product impact labor across industries. This paper chronicles the last five years of AI startup survey data, documenting information about their business models, product, suppliers, partners, and customers. Our descriptive findings add to conversations on whether AI products enhance or replace human capabilities; which algorithms, data protections, and frameworks high-tech startups use to develop their AI products; and which geographies, customer-types, and industries are sales targets.

Keywords: artificial intelligence, entrepreneurship, automation, labor, technology

JEL Classification: O33, J21, L10