By Penny Crosman
Published December 26 2017
American Banker
Artificial intelligence
Some venture capitalists have become bearish on artificial intelligence, considering it overhyped and a crowded field.
“We’ve recently passed on a couple of AI companies,” Michael Steinberg, general partner at Reciprocal Ventures, said at a recent conference. “It’s a gigantic opportunity, obviously, but there are also significant challenges for AI firms today.”
One is intense competition. “There was a study done about last quarter’s conference calls where the count of the number of times companies said ‘artificial intelligence’ in their calls was 800, up 25% quarter over quarter,” Steinberg said. “When you’re competing with 800 companies, it’s probably a difficult experience.”
And for AI systems to work well, they need to be trained on data, which is expensive to acquire, he said.
Putting aside such challenges, applying AI to tasks such as fraud monitoring and monitoring large transaction volumes is compelling, Canaday said.
“As we see more data distributed between entities, you’ll need something that will be able to analyze across these transaction sources to make sure you’re monitoring for fraudulent or suspicious activity,” he said.
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