VCs bet big on AI application startups
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«In the compute layer, in GPUs, we're not seeing any companies yet,» said Rajan Anandan, managing director at Peak XV Partners that has made investments in more than 30 companies in the AI space. «We have invested in semiconductors, but not AI chips. In the US, we are seeing a fair bit happening even in that layer.»
Specialised chips and GPUs are key to process huge amounts of data and carry out complex computing involved in AI workloads. While India has a lot of catching up to do here, it is a highly capital-intensive area, limiting the scope for startups that are instead focusing on the application side of how AI tools interact with users.
Abhishek Prasad, managing director of Cornerstone Ventures, said GPU is the hardest layer in the AI ecosystem to crack. “It’s also a tough one for startups to be able to make a dent simply given the capital requirements," he said. «The market leader (almost unchallenged) is Nvidia, and it’s near impossible to challenge them in this space.»
It is a different story in the application space.
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