Generative AI market could reach $98.1Bn by 2026
CALIFORNIA, UNITED STATES — The generative artificial intelligence (AI) market is forecasted to reach US$98.1 billion by 2026, with a compound annual growth rate (CAGR) of 32%.
According to data from the capital market firm PitchBook, more deals are being made between AI firms and venture capitalists eager to invest in generative AI technology despite the drop in startup funding in 2023.
As of March 29, the median pre-money valuation for generative AI firms soared to US$90 million, significantly higher than the market’s US$42.5 million total value in 2022.
David Beisel, cofounder and partner at NextView Ventures, said that generative AI “is where the outliers are happening right now.”
He added that the market’s value is even more pronounced as it is “juxtaposed not with a hot market, but a cooler [investment] market.”
PitchBook Senior Emerging Technology Analyst Brendan Burke added, “On the whole, AI valuations are still coming down for the bulk of legacy vendors that haven’t adapted to the latest techniques… like those who commercialized the more classical machine learning techniques and those that use off-the-shelf models instead of developing their own.”
