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- 🥇Underdog Leads AI Patents Race
🥇Underdog Leads AI Patents Race
PLUS: AI fuels US VC funding surge
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Key Points
Venture capital funding in the U.S. soared to $55.6 billion in the second quarter, marking a 47% increase from the $37.8 billion raised in the first quarter of the year.
Some insiders expect the M&A market for AI startups to become more active in the second half of the year.
👨🏻💻Context of the news - The excitement around AI technology, ignited by OpenAI's ChatGPT, has led to a rebound in venture capital funding. Investors are betting heavily on startups, hoping that AI adoption will generate substantial returns.
☕News - According to PitchBook, U.S. venture capital funding soared to $55.6 billion in the second quarter, the highest in two years. This is a 47% increase from the $37.8 billion raised in the first quarter, driven mainly by large investments in artificial intelligence companies, including $6 billion for Elon Musk's xAI and $1.1 billion for CoreWeave.
🕵🏻♂️A closer look - After peaking at $97.5 billion in Q4 2021, U.S. venture capital funding had been declining, hitting a low of $35.4 billion in Q2 2023 due to high interest rates and a sluggish exit market. However, the recent surge in investments in AI startups has reversed this trend, with investors focusing on AI foundation models and applications like code generation and productivity tools.
Despite the rise in deal activity, exits remain challenging. Small deals generated $23.6 billion in exit value in Q2 2023, down from $37.8 billion in Q1, and the IPO market has struggled, even with companies like Rubrik going public.
👨🏻💼What does an insider think? Andrew Harrison, CEO at VC firm Section 32, believes that large tech companies like Nvidia and Databricks, which have been investing in AI startups, are now more focused on acquiring key components as they identify emerging winners in the sector. Some expect the M&A market for AI startups to become more active in the second half of the year.
Key Points
China's lead in generative AI inventions from 2014 to 2023 amounted to 38,210, significantly surpassing the U.S. (6,276), Republic of Korea (4,155), Japan (3,409), and India (1,350).
Of over 50,000 patent applications filed in the last decade, a quarter were submitted in 2023 alone.
📒News - China has emerged as the global leader in generative AI innovations like chatbots, surpassing even the United States by a wide margin in patent filings.
Data from the UN World Intellectual Property Organization revealed that China filed more than 38,000 GenAI patents between 2014 and 2023, whereas the United States filed 6,276 patents during the same period.
Christopher Harrison, WIPO's Patent Analytics Manager, highlighted that Chinese patent applications covered a wide range of sectors, including autonomous driving, publishing, and document management.
🤓What's more?
Generative AI patents currently account for 6% of all AI patents globally, as per the report.
The report pointed out a notable increase in generative AI inventions, with over 50,000 patent applications filed in the last decade, a quarter of which were submitted in 2023 alone.
Top applicants included TikTok owner ByteDance, Chinese e-commerce giant Alibaba Group, and Microsoft.
According to the data, South Korea ranked third with 4,155 patents, followed by Japan with 3,409 patents, and India with 1,350 patents, with India showing the fastest growth rate.
WIPO noted the likelihood of another wave of patent filings soon and plans to release a future data update, potentially using generative AI to illustrate the trend.
🙆🏻♀️What else is happening?
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