Almost a year into the boom ignited by the November launch of ChatGPT, some startups that epitomized the zeal for so-called generative AI are now navigating layoffs and reduced user interest. Investors are unsure whether the new crop of AI startups will be able to survive, especially as tech giants such as Microsoft and Alphabet’s Google solidify their dominance over the technology.
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AI startup buzz is facing a reality check
“We’ve moved from a moment of ‘How big can this be?’ to ‘How do we make it work?’ ” said Sunil Dhaliwal, a general partner at Amplify Partners. Dhaliwal sits on the board of Runway, which builds generative AI tools for content creators, and said about half of his firm’s recent investments have been in AI startups.
