Vladimir Kokorin: "The World is just beginning to discover all the possibilities of AI"

Founder of the British company BCCM Group, Vladimir Kokorin*, on why investor interest in AI-based technologies is growing and what future these investments hold.

Artificial intelligence has long since ceased to be something out of science fiction. It has been successfully functioning in reality for quite some time and, naturally, has become a huge platform for profit and investment. For instance, Wall Street analysts believe that today’s leaders in AI will achieve higher profit growth rates than those expected from dot-com leaders in the 2000s.

Indeed, Nvidia, which has become a symbol of the AI boom, is now worth more than Amazon and Alphabet. Microsoft, betting on a partnership with OpenAI, is experiencing a true renaissance. Meta, after unsuccessful experiments with the metaverse, is back in the game thanks to its advancements in AI, including the Llama language model, generative AI for advertisers, and the MART vulnerability protection system.

Despite some skepticism and concerns about overvaluation in this field, investors continue to actively invest in AI technology development. Why is interest in this field so resilient? To help us understand this, we turned to Spanish venture IT investor, founder of the British consulting company BCCM Group, and co-founder of the international corporate travel service Tumodo, Vladimir Kokorin.

Explosive growth of the investment market

“Undoubtedly, the artificial intelligence industry is showing rapid development dynamics, —  states venture investor Vladimir Kokorin. — According to some forecasts, the market volume could reach nearly a trillion dollars by 2027. This is one of the main reasons why investors value the potential of this field so highly.”

According to Goldman Sachs, global investments in AI amounted to $110.2 billion in 2023. The upward trend continued into 2024, marked by notable capital infusions into the sector. Apple acquired Canadian AI startup DarwinAI, Microsoft announced $2.9 billion in AI infrastructure development in Japan and invested $1.5 billion in the UAE-based company G42. Nvidia acquired the Israeli startup Run:ai for $700 million. Meta will spend $10 billion on AI projects, and Google plans to invest over $100 billion in artificial intelligence systems over the next few years.

Just a month ago, it was announced that BlackRock and Microsoft, along with Abu Dhabi-based investment firm MGX, are establishing the Global AI Investment Partnership fund, valued at $30 billion.

Industry experts note that 40% of venture investments in cloud technologies go to generative AI, and artificial intelligence dominates discussions about cloud technologies on both public and private markets.

IT investor Vladimir Kokorin observes: “Constant innovations in the U.S., China’s drive to become the world leader in the industry, Saudi Arabia’s multi-billion-dollar investments, and technology development in other countries show that the AI race has gone global. This opens up huge opportunities for investors ready to think globally and consider promising projects regardless of their geographical origin.”

Transformative Potential Across All Industries

Artificial intelligence is becoming a key factor in attracting investment due to its ability to significantly improve efficiency and reduce costs. For example, a McKinsey study shows that integrating AI into financial processes alone can increase a company's efficiency by 20-30%. In the banking sector, applying generative AI solutions can boost annual profits by 2.8-4.7%.

AI is making its way into nearly every industry, along with startups attracting millions in investments to develop revolutionary technologies.

Here are just a few examples. In healthcare, Xaira Therapeutics received $1 billion this year to create an AI-based platform for drug discovery. Insitro raised $643 million to use machine learning for identifying promising treatments.

In robotics, Figure AI increased its valuation to $2.6 billion after securing $675 million from Jeff Bezos, Nvidia, Microsoft, and OpenAI to develop a commercial humanoid robot powered by AI.

Defense technology startup Anduril, founded by Oculus VR’s Palmer Luckey, raised $2.8 billion for its flagship software “Lattice,” which uses AI to nearly autonomously control drones and cameras for territorial security.

In tourism, Hopper and FLYR raised hundreds of millions of dollars to develop services that predict ticket prices using machine learning.

“The scope and potential of AI for further progress are enormous, — explains Kokorin. — From optimizing businesses with more accurate forecasting and analytics to new technologies in healthcare and energy, we are just beginning to understand what is possible with this technology.”

Data Center Boom

Investments in the AI sector are not limited to software and algorithm development alone. Significant funds are being directed toward the infrastructure necessary for the functioning of AI systems. In an interview, Mark Ganzi, CEO of DigitalBridge Group, noted: “The most effective way to benefit from the spread of artificial intelligence is to invest in the infrastructure that supports this rapidly developing technology.”

Industry giants such as Intel, Microsoft, Google, Meta, Nvidia, and AMD have long been involved in developing open standards for AI clusters and data centers to increase the efficiency and resilience of AI platforms.

 As AI applications grow, so does the demand for powerful computing resources. According to forecasts by analytics firm ABI Research, the number of public data centers worldwide will reach nearly 5,700 by the end of this year and could exceed 8,400 by 2030.

“The rapid growth in the number of data centers clearly indicates AI’s increasing infrastructure demands, —  explains Kokorin. — It’s possible that investments in AI infrastructure could prove to be as profitable as investments in the technologies themselves.”

Vladimir Kokorin: Balancing technological vanguard and fundamental principles

According to leading analytical agencies, the artificial intelligence market will undoubtedly continue its growth. The impact of AI on the global economy is expected to be colossal. According to PwC, AI could contribute up to $15.7 trillion to the global economy by 2030, with $6.6 trillion generated from increased labor productivity and $9.1 trillion from consumption-related effects.

Larry Fink, CEO of BlackRock, recently noted in an interview that mobilizing private capital to build AI infrastructure will unlock “multi-trillion-dollar opportunities”  for long-term investments. This view is shared by analysts at Bank of America, who predict that 75% of companies implementing AI will feel a positive impact within the next five years.

Vladimir Kokorin concludes: “It’s essential to remember that success will increasingly depend on identifying companies capable of turning AI potential into tangible business results. The winners will be those who can skillfully balance between the technological vanguard and the fundamental principles of the financial market.”

* Vladimir Kokorin, a Spanish venture IT investor of Russian origin, founder of the British consulting company Business Capital Consulting & Management Partners LLP, and co-founder of the digital platform for corporate travel Tumodo.

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