The Business of AI Startups

42 Pages Posted: 3 Dec 2018 Last revised: 31 Jul 2023

See all articles by James E. Bessen

James E. Bessen

Technology & Policy Research Initiative, BU School of Law

Stephen Michael Impink

HEC Paris

Lydia Reichensperger

Technology & Policy Research Initiative, BU School of Law

Robert Seamans

New York University (NYU) - Leonard N. Stern School of Business

Date Written: July 25, 2023

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

Suggested Citation

Bessen, James E. and Impink, Stephen Michael and Reichensperger, Lydia and Seamans, Robert, The Business of AI Startups (July 25, 2023). Boston Univ. School of Law, Law and Economics Research Paper No. 18-28, Available at SSRN: https://ssrn.com/abstract=3293275 or http://dx.doi.org/10.2139/ssrn.3293275

James E. Bessen (Contact Author)

Technology & Policy Research Initiative, BU School of Law ( email )

765 Commonwealth Avenue
Boston, MA 02215
United States

Stephen Michael Impink

HEC Paris ( email )

1 rue de la Liberation
Jouy-en-Josas Cedex, 78351
France

Lydia Reichensperger

Technology & Policy Research Initiative, BU School of Law ( email )

765 Commonwealth Avenue
Boston, MA 02215
United States

Robert Seamans

New York University (NYU) - Leonard N. Stern School of Business ( email )

44 West 4th Street
Suite 9-160
New York, NY NY 10012
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
3,425
Abstract Views
10,810
Rank
6,428
PlumX Metrics