Can artificial intelligence reverse the tech recession? Startups are hiring for the next big thing.

Applications of AI

John Swarts

Millennials wanting to join the AI ​​”gold rush” are heading to San Francisco’s “Cerebral Valley” and other tech hubs across the country.

In San Francisco’s Hayes Valley neighborhood, known as the “Cerebral Valley” of artificial intelligence, more than 200 artificial intelligence experts gathered in late March to discuss the technology and how to build a business around it. We talked.

Evan Buhler, co-founder and CEO of Generative Counsel, a San Francisco-based startup, said:

“I moved from Florida to the Bay Area in January to be a part of something special,” Buhler told MarketWatch. It has the potential to be a spiritual center, and Cerebral Valley has this community and is where the flow is, which gives it an edge over everywhere else.”

Chooch, a startup that released a mobile AI app this week, said it has hired 15 people in the past three months, mostly from outside California and some from outside the United States.Emrah Gultekin, CEO of Chooch told MarketWatch Chooch now employs 73 people after months of shrinking market valuations, falling advertising spending, layoffs, high interest rates, a turbulent economy and the self-immolation of a Silicon Valley bank. .

And artificial intelligence isn’t just driving a return to San Francisco. Millennials are drawn to AI tech hubs across the country, looking to be part of the next big thing. Venture capital firms and big tech companies are pouring billions of dollars into AI technology. He had nearly 800,000 AI-related job openings in California last year, led by 142,000, according to data collected by Stanford University’s Human-Centered Artificial Intelligence Laboratory, and the pace is accelerating. There seems to be

Meanwhile, 53,000 residents in the San Francisco Bay Area died last year, according to data released last week by the U.S. Census Bureau, less than a third of the number who will leave in 2021.

Garry Tan, CEO of startup accelerator Y Combinator, said on Thursday that more than 80% of his company’s latest batch of startups are based in San Francisco, and many of them are working on AI.

Despite a significant drop in venture funding and deals in the first quarter of 2023, AI continues to prove attractive to investors. Last month, his $150 million investment in startup, led by his venture capital firm Andreessen Horowitz (better known as a16z), made the startup worth his $1 billion.

Based on nine deals tracked by PitchBook through March 29, median pre-money valuations for generative AI companies have surged from $42.5 million in 2022 to $90 million in 2023.

“The settlers are competing for 40 acres of land. [of digital land]Charley Moore, CEO of Rocket Lawyer Inc., a longtime Silicon Valley participant and observer, said: was all the rage in the tech industry and recently sparked its own Randhi rush before it cooled off. )

California isn’t the only destination for aspiring AI entrepreneurs. Texas, New York and Florida are other big hubs, according to the Human-Centric Artificial Intelligence Lab.

Appian Corp. (APPN), a cloud company that provides AI apps in Tysons, Virginia, plans to hire 600 to 700 employees this year after adding 800 last year, bringing its total headcount to will be 2,300. And AI startup All Turtles, which moved from San Francisco to Arkansas in late 2020, continues to hire steadily, his CEO Phil Libin told MarketWatch.

Still, the surge in AI development has brought some of the millennials who left during the pandemic back to the Bay Area. “This has been talked about a lot,” said Muddu Sudhakar, chief executive of AI startup Aisera, at his SXSW tech conference in Austin, Texas, in March. told MarketWatch. “People were saying he’d be part of the AI ​​revolution back in the Bay Area.”

“ChatGPT was talked about in every session, every discussion, and young people wanted to be in the middle of it all. It was like a gold rush.”

Also Read: Biden Meets With Advisors About “Risks And Opportunities” Of AI Tech

“AI is everywhere,” said John Chambers, former CEO of Cisco Systems Inc. (CSCO), whose JC2 Ventures is backing a dozen AI startups. “This is his third major frontier while I’m in tech, and his first in the internet and cloud will be bigger than two.”

According to Debasish Biswas, chief technology officer at Columbus, Ohio-based AI data platform Aware, applications for engineering jobs are in the hundreds, triple the number from last quarter. Many of them are job seekers based in the Seattle area and Silicon Valley or at the parent companies of Google, Alphabet (GOOGL) (GOOGL), (AMZN.), Salesforce Inc. (CRM), and Facebook. All companies that have announced layoffs in recent months, including one Meta Platforms Inc. (META).

“People would rather work on solutions used by top brands than layers and layers away from activity,” Biswas told MarketWatch.

Read also: US economy added jobs again in March. Is this your last chance to board the ship?

Kira Makagon is Chief Innovation Officer at RingCentral Inc. (RNG), a cloud software company, leading the company’s AI efforts. She said recent layoff rounds and the current economic crisis are pushing tech talent to “do and do something fun” at fledgling AI startups. rice field.

In fact, the AI ​​fever — the CEOs of nearly every major tech company have embraced the technology over the past few months, often during their quarterly earnings calls with analysts, touting their own products. It’s been advertised — adds to the atmosphere of the three circuses that seem to concentrate on the following areas: San Francisco Bay Area.

Appian CEO Matt Calkins told MarketWatch: “There’s a classic hype cycle and trust debate going on here. AI is a tool, not a replacement. It’s going to be a roller coaster ride for at least six months.”

Read also: The “explosive” AI trend continues.These stocks are ready for profit

And “Should we risk losing control of our civilization?” Elon Musk, Steve Wozniak and other tech leaders call for AI development to stop in petition

– John Swartz

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04-08-23 1426ET

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