In the first quarter of this year, AI media generation startups received close to 90% more venture-capital (VC) funding. PitchBook, a financial data firm, says that while big tech giants make content generation the cornerstone of their AI initiatives startups are raising record amounts to bring AI-generated images to enterprise clients.
“These startups are solving specific business needs, from helping retailers edit product photos to allowing sales teams create personalised videos for potential customers.”
According to PitchBook, the deal value for AI visual, a subsegment within generative AI, increased by nearly 90% to $402.7M in Q1 from the $212.7M total in the previous quarter.
The report notes that the deal value spiked in mid-2023. The report notes that the deal value increased in mid-2023.
PitchBook warns that the push by big tech into the field will threaten consumer-facing startups who have ridden a wave of adoption in recent years.
Apple Intelligence is a localised AI assistant that can create unique emojis and art, as well as images of your contacts. Google unveiled Veo in May at its I/O presentation, a video-generation application that runs on a specialised platform, as well as Imagen 3, a text to image generator .”
“Consumer AI media generation startups are facing a tough time as competition increases.”
Legal concerns have also plagued this space. Artists who claim that Stability and Midjourney used their work for training their respective models are suing the popular text-to image creators. PitchBook reports that both companies deny any wrongdoing.
“While many are worried about the impact of big tech’s entrance on their bottom line, others have welcomed the competition.”
“This is good news for us,” says Yair Adato, CEO and co-founder of Bria, a startup that creates images for advertising and other commercial purposes. “Companies such as Apple are increasing awareness about the potential of AI media generation which helps companies like Bria.”
Adato stated that startups play a key role in keeping the AI eco-system open and accessible.
“Big Tech Companies having a Monopoly on AI Models and Technology cannot go Unchallenged.”
“The innovation will die the day enterprise and developer teams don’t have access to foundation models’ source code.”
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