The real value of AI, beyond the hype

Technological innovation tends to be so forward-thinking that it could be argued that many companies place the cart before the horse — but that’s really the idea, isn’t it?

The hype around artificial intelligence (AI) can feel the same, and it’s resulting in the sector being reported as a bubble, like the crypto currency or dot com bubbles. But it’s not, let me explain why.

AI is an underpinning technology that’s already delivering value throughout daily life for most of the world’s population, from banking to aviation to the Alexa you may have asked about the weather forecast this morning (yes, that Alexa, created by none other than Unlikely AI’s founder) — other voice assistants are available of course…

Trading in the pony ??

Excitement about technology often peaks long before it delivers results.

Speaking of the horse and cart, cars didn’t immediately replace horses as people’s preferred mode of personal transport when they first emerged. They were less ground-breaking (literally) but still revolutionised travel over time.?

In fact, one of the first mass-produced cars, the Ford Model T, didn’t enter production until 1908, 23 years after Karl Benz took to the road in the first motor car, the ‘Benz-Patent-Motorwagen’ in 1885 (but Ford did go on to sell over 15 million by 1927).

Open Source or Open Sauce?

While companies like Meta are taking an open source approach to its AI development, it’s not the best option for those that want to protect their intellectual property (IP).

The issue is that “open source” AI is defined by The Open Source Initiative (read: the self-appointed body of what it means to be open source) as AI that “can be used for any purpose without the need to secure permission, and researchers should be able to inspect its components and study how the system works”.

There goes your secret sauce.

Real innovation in AI

Large Language Models (LLMs) are just one type of foundational model. The AI hype, especially post-ChatGPT, has overshadowed innovation happening in the sector. Here’s a couple of examples:

• Secondmind are helping automotive engineers design better cars, faster, with the world’s first decision-making platform using Gaussian processes, a probabilistic AI technique that can generate accurate predictions from low volumes of historical data. The company has a multi-year partnership with Japanese automaker Mazda, and was recently featured in Bloomberg as one of 25 top UK startups to watch in 2025.
• Altana uses federated machine learning to help governments and enterprises gain supply chain visibility without sharing underlying data, helping the company achieve a valuation of over $1 billion recently.

Good for your health

Governments are adopting AI to improve public services. The NHS in the UK is set to use AI tools recommended by The National Institute for Health and Care Excellence to assist clinicians, such as spotting broken bones and detecting early signs of breast cancer, easing the burden on the healthcare system.

Not to burst your bubble

Real innovation was never part of the supposed AI bubble to begin with – it’s just that digitisation and compute power have enabled training of very large models!

Remember this when you read another headline about AI speculation: it took Ford 19 years to sell 15 million Model T’s, and they didn’t even start selling them until 23 years after the car was invented. That’s 42 years from invention to mass market adoption.

We’ll continue to invest in AI companies for many years to come.

?? Amelia Armour - Partner

Roundup

?? In the wake of the UK Government’s Autumn budget announcement, our CEO and co-founder, Anne Glover, had her say in Startups Magazine. ?

??William Tunstall-Pedoe, the inventor behind Amazon’s Alexa and founder of Unlikely AI, believes many companies attempting to use AI are getting it wrong.?

??The Riverlane team released ‘The Quantum Error Correction Report 2024’ in partnership with Resonance.

??Secondmind featured in Bloomberg’s list of the top 25 UK startups to watch for 2024.

??Not one, but six of our portfolio companies including Riverlane , Healx , PhoreMost Ltd , Nu Quantum , and Xampla featured in an article covering Cambridge deals worth $22.5 billion in the past year.

??We announced our involvement in the European Innovation Council’s Trusted Investors Network to co-invest with venture capital funds on deep tech startups.

??The University of Cambridge listed Phoremost as one of 10 spinouts changing the story of cancer.

??Nu Quantum announced a partnership with CERN, adopting its White Rabbit Technology to create highly synchronised, data centre-scale quantum computing networks.

Upcoming events

Women’s Venture Capital Summit Europe

December 3 - Amadeus Partner, Manjari Chandran-Ramesh will be speaking at the summit on the ‘Deep Tech: Will Investors’ Efforts Yield Worthy Returns?’ panel.