Venture Capital and the future of technology: the race in Artificial Intelligence and Cybersecurity
Forbes recently published an article discussing the race in AI (Artificial Intelligence) dominance. Currently the main competition is thought to center between the world’s top two economies, the United States and China.
The two countries are said to host some of the biggest and well-funded Artificial Intelligence companies in the world. However, the two economic superpowers do not hold absolute dominion in the AI space, the report said.
France, Israel, United Kingdom, and the United States all are equally strong when it comes to AI, with China, Canada, Germany, Japan, and South Korea equally close in their AI strategic strength, the article noted, citing a report from analyst firm Cognilytica.
The Artificial Intelligence Race
Artificial Intelligence is expected to carve out an even bigger role in society over the coming years as its use becomes normalized and integrated deeper into the tapestry of our everyday lives. Industries have already geared up to accept more and more of the technology in its space, with the normalization of smart factories, driverless cars, and the use of wearable technology in the healthcare sector.
A report by KPMG said venture capitalists the world over invested about US$12 billion in Artificial Intelligence, particularly in its use in industries such as healthcare, finance and transportation in 2017. This shows an increase of about 100% from the year-ago figure. For the fourth quarter of 2017, ten of the biggest venture capital deals were evenly distributed between China and the United States, the South China Morning Post reported, citing the KPMG report.
In the same year, China’s State Council released a three-step plan outlining the rationale behind its expectations of AI’s development and deployment. The county aims to build a 1 trillion yuan industry and become the world leader in Artificial Intelligence by 2030, according to a CNBC report.
Fast forward a few years and the United State President Donald Trump released the American AI Initiative in 2019 which sketched out a broad plan for how the country can establish itself as a leader in the AI space. At the time of its release, it was noted that the initiative did not provide new research funds, and while it directs federal agencies to allocate money towards the cause, it did not indicate where the money would come from, according to Harvard Law School’s Jolt Digest.
More recently, the White House Federal agencies, in a bid to foster public trust in AI systems, is said to be establishing guidance for AI development and use across different types of technology and industrial sectors. In January 2020, the White House proposed AI regulatory principles for the use of AI in the private sector.
The Concern Over Cybersecurity
As technology gets more deeply embedded into our everyday lives, the more at risk we become to its vulnerabilities, hence the spate of cybersecurity attacks targeting government institutions as well as the private sector over the years.
The United States government has seen the dangers of cyberattacks such as ransomware and moved to pass the Department of Homeland Security (DHS) Cyber Hunt and Incident Response Teams Act in response to the rising threat.
“Cyber security is continually growing more and more complex, and it is more and more urgent not only for large corporations like banks and large companies, but also for your own personal lives,” said Wilson Lin, head of Cyber NYC, a city initiative of the Economic Development Corporation. “There are new stories every day, every week about some large credit agency or large hotel chain being hacked. People are continually realizing that we are vulnerable, and a lot of our personal data is at risk.”
Just this February, New York City moved to team up with Israeli venture capital firm Jerusalem Venture Partners (JVP) to open a cybersecurity center in Manhattan to drive a $100 million initiative – which includes a $30 million contribution from the city – that aims to create jobs and transform the city into a global leader in cyber innovation.
Jerusalem Venture Partners is said to be working with the mayor’s office and the Economic Development Corporation of New York, according to news sources. JVP Chairman Erel Margalit said that about 30 companies are currently up and running in the center.
A whitepaper on cybersecurity noted that the global market grew from $3.5 billion in 2004 to about $138 billion in 2017 – over 39x in 13 years. It doesn’t seem likely that the sector will halt its upward trajectory, at least not in the near term. The Worldwide Semiannual Security Spending Guide from International Data Corporation said global spending on security solutions will reach a compound annual growth rate of 9.2% over the 2018-2022 forecast period and amount to $133.8 billion in 2022.