I recently saw an interesting stat. Crypto fundraising was down 78% in the first half of 2023. If you recall the crypto craze of 2021 with Superbowl ads, celebrity endorsements and 7 figure NFT purchases, the fall in hype resulted in a dramatic fall in funding. Is generative AI headed in the same direction?
Generative AI, on the other hand, seems to be going from strength to strength. But is that really the case? After slowing down its growth rate over the past three months, ChatGPT saw a 9.7% drop in worldwide traffic from May to June, according to Similarweb.
Have we reached generative AI peak?
In addition, a look at Google Trends, shows that consumer search volume is also dropping for terms like ChatGPT, OpenAI, Generative AI, GPT, etc
A recent survey of 2,000 Americans by TheVerge revealed that despite the media attention, fewer than 60% of Americans have heard or tried ChatGPT.
Not so fast
Take Character.ai for example, the company that raised $250M from A16Z to develop LLM chatbots that can act as a specific character.
Character AI attracted 280 million web visits last month, growing 60% month-over-month, with nearly 30 min average session duration.
Interestingly, according to Google Marketing, AI searches are actually growing: “people’s interest in the topic of “artificial intelligence” on Google Search, which has increased by 3.5X year-over-year in the United Kingdom.1“
An in earning calls, “Generative AI” experienced a 129% increase in earning call mentions in Q2 2023 compared to the previous quarter.
So which one is it? Are we on the way up or down in generative AI use and adoption?
Generative AI is still in the early innings
Hype coming down is probably a good thing, but I don’t think generative AI is going away anytime soon. I expect to see many more existing companies incorporating generative AI features in their existing products and services (see Dropbox, eBay, Canva, Adobe, Salesforce etc) as well as new startups working on vertical AI solutions, industry-specific automations and tooling for deploying generative AI safely in the organisation.
A case in point, Dawn Capital published an interesting take on the potential of generative AI startups in Europe. Compared to other tech waves, generative AI is a a space where European (and Israeli) startups have the potential to play a big role at every level: from foundation models (open source) to the tooling and infrastructure of LLMs, to the application layer.