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Decoding Google’s AI Ambitions (and Anxiety)

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Infographic breaking down Sundar Pichai's recent Google AI letter

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Decoding Google’s AI Ambitions (and Anxiety)

Anyone who’s experimented with ChatGPT can get a sense of the potential of generative AI—even in the technology’s earliest stages.

The hype around AI was rising throughout 2022, and has reached a fever pitch today.

ai search interest chart

We’ve seen hype cycles swell around specific technologies before. Blockchain, Metaverse, NFTs, the list goes on. It remains to be seen what tangible value is created after the heat dies down, but in the meantime, some of the world’s biggest companies are taking it very seriously.

Google—which internally reoriented itself around AI years ago—is at the forefront of this movement, so the recent letter published by Google CEO Sundar Pichai is consequential.

After all, billions of people use Google Search to learn about the world, and Alphabet is one of the world’s most valuable, powerful tech companies. But before we “read between the lines” of the letter, it’s worth revisiting the larger context that this letter addresses.

OpenAI Has Entered The Chat

Artificial intelligence has been chalking up a number of wins in recent months, but it was DALL-E Mini and ChatGPT that really allowed generative AI to burst into the public consciousness. In fact, ChatGPT became so popular in a short amount of time, that Google declared an internal “code red” to address the issue. Leaders at Google were well aware of the disruptive power of conversational AI because they were already testing their own models internally.

Microsoft recognized the potential as well, and invested $10 billion in OpenAI, which runs ChatGPT as well as a number of other publicly-accessible AI tools. Microsoft’s intention was to bring the magic of ChatGPT over to their Bing search engine—and perhaps steal market share away from Google.

This sets the stage for what we’re seeing today. Essentially every big tech firm is singing AI’s praises, and Microsoft and Google appear to be entering into an AI race.

The AI Race is Heating Up

If there were any questions about how seriously Google was taking Microsoft’s new partnership with OpenAI, recent messaging should remove all doubt. The letter above, by Sundar Pichai speaks volumes while never straying far from official talking points. First, here is the high-level messaging in Pichai’s letter:

  • Google has already been in the AI game for years now
  • Bard is going to make Google search more ChatGPT-like
  • Google is only late to the party because they’ve been careful

On this last point: a message from the CEO, which reaffirms the company’s commitment to AI would normally coincide with a product launch, not one that will be released to the public “in the coming weeks”. This messaging highlights a key barrier that Google is facing. Fearing the “reputational damage” that could come from rolling products out prematurely, the company has been forced to move slower than the market now expects.

Google has already endured a painful misstep after reporters discovered an incorrect answer in a promotional video touting the conversational AI service, Bard. This simple mistake cost Alphabet $100 billion in market value—demonstrating how high the stakes are now that Big Tech’s AI progress is under the microscope.

The timing of this letter is also very telling. The letter was published the day before Bing rolled out new AI-enabled features to the public.

Let the jockeying for position begin.

Nobody Wants to be Left Behind

Google and Microsoft may be the biggest players battling it out in the AI space, but there are indicators all over that AI represents a massive technological shift that will impact a number of industries. From Fiverr’s “Open Letter to AI” to Baidu’s recent AI chatbot announcement, it seems that every day brings fresh news that fuels AI hype.

One thing’s for sure: AI will be integrated into digital tools in more noticeable ways. And for better or worse, we’ll all be participating the experiment.

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Ranked: The Top Startup Cities Around the World

Here are the global startup ecosystem rankings, highlighting the scale and maturity of major tech hubs worldwide.

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This bar chart shows the top startup ecosystems in the world in 2024.

The Top Startup Cities Around the World

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

A richly connected network of founders, venture capital firms, and tech talent are some of the key ingredients driving a startup ecosystem.

As engines of growth, these tech clusters are evolving on a global scale. While the world’s leading startup cities are concentrated in America, several ecosystems, such as Beijing and Seoul, are growing in prominence as countries focus on technological advancement to spur innovation.

This graphic shows the best startup cities worldwide, based on data from Pitchbook.

The Global Startup Ecosystem Rankings

To determine the rankings, each city was analyzed based on the scale and maturity of their startup ecosystem over a six-year period ending in the second quarter of 2023.

Among the inputs analyzed and used to calculate the overall development score were fundraising activity, venture capital deals, and exit value:

RankCityDevelopment ScoreCapital RaisedDeal CountExit Value
1🇺🇸 San Francisco90$427.6B19,898$766.3B
2🇺🇸 New York76$179.9B13,594$171.7B
3🇨🇳 Beijing76$161.2B8,835$279.2B
4🇨🇳 Shanghai73$130.3B7,422$186.8B
5🇺🇸 Los Angeles71$144.6B9,781$181.4B
6🇺🇸 Boston70$117.0B6,044$172.8B
7🇬🇧 London64$99.0B11,533$71.9B
8🇨🇳 Shenzhen63$46.4B5,020$66.3B
9🇰🇷 Seoul61$31.1B6,196$71.0B
10🇯🇵 Tokyo60$26.2B5,590$28.0B
11🇨🇳 Hangzhou59$50.7B3,361$88.7B
12🇺🇸 Washington D.C.55$43.7B2,706$28.2B
13🇺🇸 Seattle54$31.7B2,693$35.6B
14🇸🇬 Singapore52$45.7B4,507$38.0B
15🇺🇸 San Diego52$33.5B2,023$44.7B
16🇺🇸 Austin52$26.4B2,636$22.9B
17🇨🇳 Guangzhou52$24.7B1,700$24.0B
18🇮🇱 Tel Aviv51$21.0B1,936$32.2B
19🇺🇸 Denver51$26.8B2,489$29.9B
20🇩🇪 Berlin50$31.2B2,469$15.9B

San Francisco dominates the pack, with $427.6 billion in capital raised over the six-year period.

Despite a challenging funding environment, nearly 20,000 deals closed, highlighting its outsized role in launching tech startups. Both OpenAI and rival Anthropic are headquartered in the city, thanks to its broad pool of tech talent and venture capital firms. Overall, 11,812 startups were based in the San Francisco Bay Area in 2023, equal to about 20% of startups in America.

Falling next in line is New York City, which raised $179.9 billion over the same time period. Crypto firm Gemini and machine learning company, Hugging Face, are two examples of startups based in the city.

As the top-ranking hub outside of America, Beijing is home to TikTok’s parent company, ByteDance, which is one of the most valuable private companies in the world.

In recent years, much of the startup funding in China is being driven by government-backed funds. In particular, these funds are focusing heavily on “hard tech” such as semiconductor-makers and electric vehicle companies that align with the government’s strategic long-term goals.

Another leading tech hub, Singapore, has the highest venture capital funding per capita worldwide. In 2023, this was equal to an impressive $1,060 in venture funding per person. By comparison, venture funding was $345 per person in the U.S., the second-highest globally.

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