Enterprises across the globe will likely spend around $150 to $200 billion towards generative artificial intelligence (AI) technology across functions like data analysis and digital operations to grow, stay efficient and relevant, said a report by McKinsey and SaaSBoomi.
In 2023, enterprises spent nearly $15 billion on Generative AI, representing 2% of the overall software spends, which will be around 10% in 4-5 years as per the study presented at the SaaSBoomi annual event on March in Chennai.
"The way Gen AI is growing is phenomenal. Every enterprise will spend or is already spending more on this to keep themselves relevant in the age of AI... There is a lot of opportunity for SaaS firms that are building with AI in this journey, " said Manav Garg, cofounder of Eka Solutions and a founding member of SaaSBoomi during the presentation
The presentation said that enterprises will spend on Gen AI as new technology as well renew their existing services.
The presentation also identified several new and emerging AI-first use cases like drug discovery, agents, co-pilots and vertical LLMs. Areas like high-precision systems and accounting and ERP as AI-resistant sectors.
The presentation also said that areas like human to human interactions and martech as categoroes getting disrupted by AI. Despite a funding winter last year, Generative AI (GenAI) startups remained as investors' sought after segment.
As per an IANS report, Gen AI startups raised $10 billion in venture capital globally in 2023, a huge 110 per cent rise compared to 2021.
Within five months of launch, Sarvam AI raised $41 million in its Series A funding round led by Lightspeed Ventures with participation from Peak XV Partners and Khosla Ventures.
A recent report by SaaS accelerator fund Upekkha also said that SaaS startups will have to upgrade and integrate artificial intelligence, especially generative AI, into their operations to not get obsolete and to also raise funds in 2024.
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