HOW TO CREATE AI STARTUP?
Many experts believe that artificial intelligence is the future. It’s difficult to argue with the rise in AI-enabled chatbots and voice assistants as well as driverless cars. How can you capitalize on this emerging technology?
Although it may seem daunting at first, don’t be discouraged – we have your back. These are some of our top tips for starting an AI startup.
What is the AI Industry’s Size and Who invests the most in AI Startups?
In 2018, the AI market was worth $20.67 billion. This number is expected to grow ten-fold by 2026 and reach $200 billion. Some large tech companies spent a lot of money on their AI innovations and efforts up to 2022. Nvidia is a major player in AI development and profit. In 2018, earned $606 million by selling its AI-based hardware.
Amazon is well-known for its AI-driven voice assistant Alexa. It makes a lot from Alexa alone. According to reports, Amazon’s revenue will rise to $19 billion by 2022 just from the product. Although Amazon is a trillion-dollar company, $19 billion is still a significant amount.
According to the list of companies that spent the most overtime on AI startups, Google has spent $3.9 Billion by 2018. This makes it the market leader. Amazon comes in second with $871 million, and Apple third with $786 million.
This is just a partial list. Intel invested $776 million in AI, while Microsoft “only” spent $690 million. Uber spent $680 million and Twitter $629 million. AOL also invested less than $200m.
Here are the hottest AI trends
Artificial intelligence was a buzzword in the tech world a few years back. Everyone wanted to be a part of the action but no one knew how to use it.
This has changed significantly because AI is now more widely understood by the industry. Among the most successful AI-based startup concepts in recent years are:
AI is currently used in applications that use data and computers to recognize it, such as a CRM system. Human activity can become repetitive, and this will only get worse as computers will eventually be able to outperform humans in almost all tasks. Automating repetitive manual tasks is the future of work.
Here are some steps to take when starting an AI startup
A successful launch of an AI startup requires the right team, including programmers, data scientists, marketing managers, and software engineers. Like any other business venture, success, in the beginning, depends on hiring the right people. It’s not all easy.
We recommend that you read this guide to starting a small business. However, it is important to have a team of skilled workers.
You’ll be needed to fill the most critical roles immediately for basic data science functions. Additionally, at least two to three people are required to build prototypes. Other roles in AI startups include product designers, UX and product managers, as well as user experience experts and marketing support staff.
After you have developed your AI platform, marketing will be the most important part of your business. However, you must first market the product. Your first priority should be to hire data scientists and engineers who are skilled and knowledgeable in order to train your AI platform to learn, interpret, and improve over time. This link outlines the roles of members of an AI startup.
Funding your AI startup
An AI startup has many costs. Data scientists are not cheap. Your average software startup will need more funding to get started. You will need to create a product that is attractive to clients and users, as well as a service to help them implement it.
There are a few options when it comes to funding AI startups.
Self-funding through the bootstrap method
Self-funding offers the benefit of giving you complete control over your business. It can also be a risky option in very rare cases.
Courting venture capitalists
Venture capitalists are also known as angel investors. They may be interested to support your company in return for a seat on the board or a share of your company. A thorough company strategy is necessary to secure financial investment.
Applying for a small business loan
If you aren’t able to raise enough capital but still want full control of your business, a loan might be a good option. A comprehensive business plan for credit unions and banks, with projected costs and financial projections, should be prepared.
You can find success stories from AI startup funding and learn how these companies managed to secure the capital they needed to grow their businesses.
Maintain and develop proprietary data
A valuable asset for any AI startup is high-quality, proprietary data. It will be crucial in determining whether your startup succeeds.
Before you start, make sure to ask questions about data types, data sources and data strategy.
There are many ways to acquire proprietary data. You can either collect the data yourself or use an ML-based algorithm to manually capture data. Third-party providers may also be able to provide data. The second option is the best, as it provides you with accurate and relevant intrinsic data. Although you might face some difficulties when training your machine initially, once you get the details right, you will be able to harness valuable data that will give you an edge.
Real-life solutions for real-life problems
You need to be realistic about the problems it can solve when building an AI-driven solution. You could present a solution that helps sales and marketing or an application-modernization solution. It doesn’t matter what it is, you need to make it real in order to attract many people. This solution should be the driving light for your AI startup.
Startups are flexible and can easily be incorporated into other offerings or products. However, this will only lead to losing sight of the primary goal. Diversification is not a good idea. Instead, focus on consolidating your position with an existing solution.
Hiring staff to support your efforts is a smart move
Palatine Analytics was a place where we emphasized the importance of staff and employees as growth enablers. When I was hired for Genesis AI, that’s what I tried to do. We wanted to hire the best talent for the job with consideration of their qualifications and how they would fit into our culture.
Our focus wasn’t just on technical hiring. We wanted Genesis AI to be as diverse as possible. If you look at the business advisory board, you’ll see leaders from all walks of life, from CEOs to professors, who provide a balanced view on how to proceed.
Communicate in the language of your clients
It is easy to get lost in the details of a startup and lose your subject-matter knowledge. This is when you begin to use jargon and fancy terminologies in order to describe the high-end solution that your AI startup offers — and this is where problems start.
Even if your solution is the best, clients and investors will not be able to understand it. Simply put, communicate your AI startup’s solution using the simplest language possible. To maximize impact, you need to make it as simple and straightforward as possible.
Start small with a pilot project
- Start small before you invest hundreds of thousands of money in your company strategy.
- One example of small pilot projects in AI is the creation of an AI-based email program that can extract important information from messages, such as addresses and dates. Although it might not be a revolutionary technology, it can help you to establish an AI company.
- A larger number of pilot projects could be used to use AI to suggest other products based upon a user’s browsing history or analyze the sentiment on your website to generate positive and negative keywords that will increase sales.
- If you are unable to make accurate predictions or insights from your data, these projects won’t yield a lot of return on investment. However, they can help you prove you’re on track before you spend significant resources on your AI business.
Customer outreach is a method of establishing a digital footprint.
- It is difficult to market your AI startup to a consumer base. First, convincing consumers that they need your product or can’t find it anywhere else. The second challenge is brand advocacy in the digital landscape.
- Many consumers are unable to articulate the purpose of your company. A communications plan is the first step in the process. It outlines how you will use them, what they’ll be interested in, and what information you are willing to share about your tech.
- It can be difficult to establish a startup’s digital marketing strategy. But it is not impossible.
These three strategies will help you get started with digital marketing:
Make a digital footprint or skeleton of your AI startup. Use analytics tools such as Qualtrics or Drossos to identify the data sets and products that your startup will require to create and execute a digital marketing plan. You can review your data sets to find ways to reduce confusion and keep clarity about what you are doing, with whom and why.
- List all channels that you will use to develop a marketing strategy. Which channels are you using? What marketing strategies will you use to build on the existing offerings and services that you have?
- Create an implementation plan. This will outline the steps you’ll take to implement, measure, and execute your digital marketing strategies. To track your progress and performance over time, you will need to establish a strategy.
- You’ll create a digital footprint and set up processes to measure and track your progress. Also, outline how you’ll evaluate and guide your future efforts. This will help you build brand awareness and customer acquisition.
Don’t be in a hurry to sell. Pay attention to what others are saying and ask for comments. You can gradually broaden your network of investors and business entrepreneurs. You’ll need to grasp digital marketing tactics to attract customers. You should set aside money for marketing. Search engine optimization (SEO), email marketing (SEM), and search engine marketing should all be used. At this point, your primary focus should be on marketing.