A new benchmark for AI investment: Swift Ventures unveils system to separate talk from action

Swift Ventures has unveiled a brand new artificial intelligence company index at the moment, creating the primary systematic scoring system to establish public corporations making real investments in AI expertise quite than simply speaking about it in earnings calls.

The enterprise capital agency developed the index by fine-tuning massive language fashions to research 1000’s of earnings transcripts, hiring information, and analysis contributions. The evaluation revealed that whereas corporations talked about AI over 16,000 occasions in final quarter’s earnings calls, solely a small fraction are making substantial investments within the expertise.

“Everybody sees that the world’s altering — AI is altering the world, however most individuals, they simply don’t have a option to partake within the upside,” mentioned Brett Wilson, cofounder of Swift Ventures, in an unique interview with VentureBeat. “They’ll’t spend money on non-public corporations like I do as a VC, and it’s simply not simple to seek out true AI corporations past simply shopping for Nvidia or the Magnificent Seven.”

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The index at the moment tracks roughly 90 corporations and makes use of three main metrics: funding in AI analysis and open-source contributions, AI expertise density, and income derived from AI operations.

Corporations that meet the standards for inclusion within the index have demonstrated exceptional market efficiency, with the index displaying 37% annual development over the previous three years, considerably outperforming each the Nasdaq’s 12% and the S&P’s 19% development throughout the identical interval.

Maybe most hanging is the correlation between analysis funding and profitability. Wilson famous, “After we checked out corporations which might be usually contributing to AI analysis and open-source fashions, you see it mirrored of their profitability. These corporations have a median gross revenue of one thing like double common tech corporations that don’t — 55% versus 25%.”

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The index reveals a stark expertise hole in public markets. In accordance with Swift’s evaluation, solely about 200 public corporations preserve greater than 1% of their workforce in AI-specific roles, regardless of widespread claims about AI adoption. This metric has develop into more and more necessary because the U.S. Bureau of Labor Statistics initiatives unprecedented demand for AI engineers.

“You’ll be able to’t simply discuss AI and be an AI firm,” Wilson emphasised. “It’s about making investments in AI expertise and infrastructure and analysis and contributing to the neighborhood.”

Inside Swift Ventures’ game-changing plan to rework AI funding

The index has recognized a number of under-the-radar corporations making vital AI investments, together with Doximity, which develops AI-powered medical writing purposes, and Leidos, which focuses on defense-oriented autonomous programs. These corporations are “rising over 50% per yr,” in response to Wilson, suggesting a broader AI transformation past well-known tech leaders.

Swift Ventures plans to make the index accessible at no cost with quarterly updates and is contemplating launching an ETF in early 2025 if investor curiosity materializes. The agency’s strategy represents a big shift from present AI funding autos, specializing in programmatic scoring quite than particular person inventory selecting.

“We don’t wish to appear to be one thing like a Kathy Wood‘s car, the place somebody’s cherry-picking sure shares,” Wilson defined. “Our intention was to make use of sort of a programmatic standards to select corporations, and have the system do it.”

The index launch comes at a crucial second for AI funding, as public market buyers wrestle to distinguish between corporations making meaningful AI investments and people merely adopting AI terminology. It additionally arrives as non-public AI corporations like Databricks, Scale AI and Anthropic put together for potential public choices within the coming years, suggesting the AI firm panorama might shift dramatically.

This new methodology has the potential to develop into a normal benchmark for evaluating AI investments, doubtlessly influencing how corporations allocate assets to AI improvement and the way buyers measure AI capabilities in public markets.

For company leaders, the index supplies clear metrics for what constitutes real AI funding. As Wilson famous, “Actual AI funding means that you’ve got a preponderance of AI folks, that you simply’re investing in AI analysis, contributing it to the neighborhood, and that your income is essentially affected by these AI investments.”