The rapid growth of artificial intelligence (AI) development companies has attracted investors worldwide, but the sector remains volatile, with high implementation costs and regulatory risks posing significant challenges. Assessing the measurable value of AI investments remains difficult, creating uncertainty about potential returns on investment, according to investment expert Radosław Jodko.

Radosław Jodko is an investment expert who has shared insights on the topic of investing in AI companies. According to Jodko, investors face challenges in assessing the measurable value of AI, leading to uncertainty about returns on investment. He notes that high implementation costs and regulatory risks are frequently cited challenges associated with AI.

Jodko also comments on the dynamic nature of the technology market, particularly in the AI sector, emphasizing that both companies and investors are still learning about this market. He points out the difficulty in determining the benefits of AI investments, which can cause uncertainty regarding investment returns.

Jodko suggests that the AI sector is entering a phase of "real accountability," as investors and companies shift from experimentation towards demonstrating business value[3]. He also observes that investors have reached a point where they want to see results beyond promises, specifically the successful monetization of AI.

What do we expect next? 

The AI market is projected to grow significantly in the coming years. Experts predict substantial expansion, but also suggest a shift towards more practical applications and a "real accountability" phase.

Market Growth Projections:

*   The global AI market is estimated to reach $259.1 billion in 2024 and is projected to increase to $4,726.6 billion by 2033.

*   This signifies a compound annual growth rate (CAGR) of 38.1% between 2024 and 2033.

*   Another analysis estimates the AI products market will grow annually by 40% to 55% for the next three years.

*   By 2025, Goldman Sachs forecasts private investments in AI technologies could reach $158.4 billion.

*   Statista's analysis projects the AI products market to increase from $135.94 billion in 2023 to $415.63 billion in 2027, and potentially $826.76 billion by 2030.

Investment Trends and Focus:

*   Venture capital is highly interested in AI, with funding for generative AI companies reaching $21.8 billion globally in the past year, a fivefold increase.

*   The number of such transactions in 2023 reached 426, which is 265% higher than before the pandemic.

*   Investors are starting to focus on AI applications that offer practical value, such as content summarization, knowledge organization, data management and automation.

*   A market correction is expected in 2025, which will lead to more rational investments and a focus on practical AI applications[6]. This correction is due to key players like Microsoft and Google investing heavily in infrastructure development, but the return on these investments remains limited.

*   The median revenue multiple for AI companies was 25.8x.

Opportunities for Businesses:

*   The expected decrease in the cost of AI services, driven by competition among language model providers and the development of open-source solutions, presents an opportunity for businesses to access advanced tools at more affordable prices.

*   Advancements in edge computing allow companies to develop AI products tailored to specific user needs without relying on large cloud platforms.