Work

Unlocking funding success for generative AI startups: The crucial role of investor influence

Year: 2024

Type: article

Abstract: • Investor influence plays a significant role in securing funding for GAI startups. • Technological advancements have insignificant impact on funding levels. • Building strong investor networks is essential for the growth and success of GAI ventures. Generative AI (GAI) is transforming industries by enabling autonomous content creation. This study explores the impact of investor and technological influences on the funding of 556 GAI startups from 2010 to July 2024. Using principal component analysis, we find that investor influence significantly boosts funding across all levels, while technological influence is insignificant. The results highlight the crucial role of investor networks in securing financial resources for GAI startups. The study's implications suggest that entrepreneurs and policymakers should focus on building strong investor relationships to support the growth of GAI ventures.

Source: Finance research letters

DOI: 10.1016/j.frl.2024.106203

Authors: Abu Bakkar Siddik, Yong Li, Anna Min Du

Institutions: University of Science and Technology of China, Edinburgh Napier University

Language: English

Topic: Private Equity and Venture Capital

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Industry, innovation and infrastructure

Open Access status: hybrid

Estimated APC paid: $3,350