Annual list of promising BI startups includes key trend: AI

In today’s issue, we take a look at our annual list of the most promising startups.

But first let’s be honest, this is something promising.

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Big story

Novices

Harlem Capital; Boldstart Ventures; Kimberly White/Getty Images for TechCrunch; Chelsea Jia Feng/BI

Remember these names.

Business Insider spoke with dozens of venture capitalists to develop their annual list of the most promising startups.

We identified 85 young companies that are on the rise based on recommendations from 50 top VCs. Investors highlighted companies from their portfolio and startups with which they had no financial ties.

Surprise! AI-focused startups made up the majority of the list. Leena Rao, who curated the list and leads the VC and BI startups team, estimated that about 80% of the startups included are AI-focused.

But there’s a subtlety amid the AI frenzy. Instead of big-language models or universal AI tools, these startups are focusing on specific sectors. From co-working spaces to weather forecasting and military defense, they’re looking to leverage AI in niches.

Beyond AI, some familiar faces remain. Healthcare and fintech continue to attract even as AI has overtaken the startup community.

iStock;BI

While AI startups strive to be diverse, the market is undoubtedly saturated.

This is the norm in the startup world. When investors are willing to throw a ton of cash at an idea, people try to replicate it.

Hype builds until there are too many startups and too little market share. Then consolidation happens. A new trend emerges. Rinse and repeat.

But unlike previous trends—the social media apps of the late 2000s or the personal finance tools of the 2010s—AI comes with a hefty price tag. Running AI models isn’t cheap. Nor is it immediately clear how they can generate revenue.

Traditionally, the technology industry has been comfortable spending money on growth and innovation, but times have changed.

We are no longer in the zero interest rate phenomenonand the world’s largest companies are having trouble convincing investors that investing in artificial intelligence is worth it.

Even though the revolution only began two years ago, cracks are starting to appear in the AI ecosystem.

That’s not to say AI is over the top. The technology will have a huge impact on the world. But the industry will have to navigate difficult waters in the meantime.

It’s hard to say who will emerge unscathed, but these startups have a better chance than most.

3 things in the markets

GettyImages; Chelsea Jia Feng/BI

Wow, we’re halfway there! Solving a very popular carry trade that was based on the Japanese yen it will still take some timeaccording to JPMorgan. Arindam Sandilya, co-head of global FX strategy at the bank, said speculative traders exiting the trade are “50% to 60% complete.”
The speculative bubble surrounding artificial intelligence may soon burst. Panic selling of stocks could mean the beginning of the end of the AI craze among investors, said market strategist Paul Dietrick. He drew similarities between the recent sell-off and the dot-com crash.
Some Wall Street strategists smell blood in the water. While some investors are panicking, strategists at firms like UBS and Oppenheimer I see great growth potential for US stocks“Such sell-offs can be an opportunity to ‘catch the babies thrown out with the bathwater,’” wrote John Stoltzfus, chief investment strategist at Oppenheimer.

3 things in technology

GettyImages; Jenny Chang-Rodriguez/BI

Prosecutors used AI tool to send man to prison for life. Now the person who created it is under scrutiny. Adam Mosher claimed that his AI-powered crime-fighting tool Cybercheck had helped police and prosecutors in thousands of cases. But There were serious questions about the program and its reliabilityand Mosher is currently suspected of making false statements.
YouTube’s biggest star is embroiled in terrible scandals. Jimmy Donaldson, the creator known as MrBeast, is at the center some serious controversies in the workplaceContestants on his reality show claim they neglected set conditions, and his former employee is accused of sending inappropriate messages to a minor.
Big Tech reform is coming, but Washington won’t be the one to deliver it. Congress can’t or won’t act, so people who want big tech companies to change their approach they are trying to do it through the courts. But it is unclear whether the complaints filed in court will have any real or lasting impact.

3 things in business

GettyImages; Alyssa Powell/BI

Panic! On the job market. A weaker-than-expected jobs report sent an unpleasant wake-up call amid fears of an imminent recession the danger is much closer than we thoughtThis means that employees may have to prepare for brutal layoffs and Say goodbye to your dream of a four-day work week.
Uber is gaining popularity. After years of losses, the company reported better than expected results for the second quarter on Tuesday. Its core business, ride-sharing, is booming, and its delivery bets are paying off. In addition, Uber the advertising business achieved an annual growth rate of $1 billion — and there is still room for development.
Elon Musk’s war on advertisers has just reached a turning point. X sues a group of advertisersaccusing them of violating antitrust law through an advertising boycott. The platform has lost billions of dollars in advertising revenue since their departure.

In other news

What’s happening today

The Fortune 500 ranking of the world’s largest corporations has been published.
The first batch of Chinese G60 Starlink satellites will reportedly launch today, a venture that would directly compete with the Elon Musk-backed US Starlink.

Insider Today Team: Dan DeFrancesco, associate editor and presenter, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, senior editor, in London. Annie Smith, associate producer, in London. Amanda Yen, fellow, in New York.