AI Hype, Data Strategy and Future Rules of Tech Startups

TECH BRIEF

AI Hype, Data Strategy and Future Rules of Tech Startups (16 minutes read)

The AI hype cycle continues to evolve as early-stage generative AI startups hold high valuations. The launch of OpenAI’s ChatGPT initiated momentum in the gen AI space, with 92% of Fortune 500 firms adopting the tool. Foreseeing potential regulatory hurdles, as noted in the EU AI Act and President Biden’s Executive Order, and understanding cybersecurity implications are essential for startups. The most critical success factor is high-quality data, suggesting enterprises should focus on data strategy rather than gen AI strategy. The quality and quantity of training data will distinguish future AI models.

OpenAI Mulls Over Benefit Corporation Structure, Prompting IPO Speculation (1 minute read)

OpenAI CEO Sam Altman has indicated there may be changes in governance structure, steering the AI company towards a for-profit benefit corporation, in line with rivals Anthropic and xAI. Such a change could potentially lead to an IPO for the currently privately-valued $86 billion company.

Apple's Gradual AI Intelligence Feature Rollout Extends to 2025 (22 minutes read)

Apple plans a gradual rollout for its Intelligence features in an attempt to avoid the issues that have troubled other AI systems in the past. Features of Apple Intelligence include prioritizing notifications and summarizing webpages, voice memos, emails, and meeting notes. Available languages and regions will be limited, with global availability expected to take years. Apple's new approach means new technology won't follow a strict timeline, giving developers more time to support new app capabilities. The staged launch also allows adjustments for possible 'AI hallucination.'

Wells Fargo's Flashy Fintech Venture Bleeds $10M Monthly Amid Renegotiation (6 minutes read)

Wells Fargo's partnership with fintech startup Bilt Technologies to launch a credit card enabling fee-free rent payments with rewards has reportedly cost the bank as much as $10 million monthly. Upon relaunching in 2022, the innovative card drew a million users in the initial 18 months. However, flawed revenue predictions, such as cardholders carrying balances, have led to financial losses. The consequent renegotiation process urged Wells to discontinue bidding on co-branded credit card programs and to focus more on creating standalone credit cards.

Microsoft and Nvidia Lead Investment Surge in AI Startups (10 minutes read)

Tech giants Microsoft and Nvidia, along with their venture arms, are leading in investments in AI startups, with companies like Google and Databricks following closely. Nvidia participated in major funding rounds for Scale AI, Figure, and Mistral AI. Microsoft made notable investments in OpenAI and UAE-based AI firm G42. However, potential regulatory scrutiny from the Federal Trade Commission and the Justice Department could cause these corporations to pause their AI investments.

McDonald's Halts AI Drive-Thru Test, Future May Still Hold Voice-Ordering Solution (2 minutes read)

McDonald's will discontinue its AI drive-thru ordering partnership with IBM by 2024. The program was tested in 100+ locations, and despite an unclear exit reason, McDonald's sees AI voice ordering as a future feature.

QUICK

Tempus AI Climbs 15% in Nasdaq Debut, Pushing Valuation to $7B - AI-focused healthcare diagnostics firm Tempus AI's stock rose 15% in its Nasdaq debut, raising $410 million at an implied $6 billion valuation. The company leverages AI to offer more accurate medical treatments and anticipates achieving cash flow and EBITDA positivity within a year.

Duolingo's Winning Streak in Tech: Hooking Users with Daily App Engagement - Duolingo leverages well-timed notifications and streaks to keep users engaged, contributing to the company's success and $8.5 billion valuation. The language learning app's careful reminder system encourages over 30 million daily active users to maintain daily habits.

South Africa Slams Higher Import Duties on Shein and Temu: A Bid for Fair Competition - South Africa's Revenue Service to enforce higher import duties on Shein and Temu's clothing orders from July 2024. The taxation reform addresses local retailers' claims of Chinese firms' unfair competition advantaged by a tax loophole.

OpenAI Retains Microsoft as Primary Cloud Partner Amid Oracle Deal—OpenAI reassures Microsoft of its primacy as its cloud partner amidst its new deal with Oracle. Microsoft's Azure AI platform expands to Oracle's infrastructure for certain tasks, keeping its lead role in advanced model training.

Samsung Galaxy Ring to Charge with Earbud-Like Case, Launching Soon - Samsung is set to introduce the Galaxy Ring, which will utilize an earbud-like case for charging. The new device is expected to launch on July 10.