For AI startups, more funding is often not the answer

One of the hottest areas for VC investment at the moment is AI/machine learning -- that includes artificial intelligence algorithms, related machine learning systems, neural networks, and back-end processing to produce insightful and self-learning applications. As Nvidia's CEO recently said: VC investment in AI has risen from $3.2 billion in 2014 to $9.5 billion for the first five months of 2017 annualized, with the number of funding rounds nearly doubling since 2015 to over 1,200 on an annualized basis so far this year. Investors piling into a space aim for multiple exits worth hundreds of millions of dollars. However, the pattern of AI exits is the opposite. Most successfully-exited AI companies sell for below $50 million after raising only a small amount of money.