(Bloomberg) — Salesforce Inc. is doubling down on investments in AI startups as it powers its products with new generative artificial intelligence capabilities and looks to emerging technologies to help restore sales growth.
Venture capital funding for the software maker focused on generative AI will be increased to $500 million from an initial $250 million announced in March, the company said in a statement Monday. Additionally, the company’s portfolio of artificial intelligence tools is called AI Cloud, which is on par with other major product lines such as Sales Cloud and Service Cloud.
After OpenAI’s introduction of ChatGPT sparked strong interest from companies across a wide range of industries, all major technology companies are adopting generative AI and trying to add new tools. Ahead of the AI-focused Salesforce event, the company announced security standards for its technology, including preventing large-scale language models from being trained on customer data.
“This was the number one concern for every client we spoke to,” said Adam Kaplan, senior vice president of AI, about the potential exposure of sensitive information through the use of these models. increase.
Large language models are programmed to learn through trial and error using large amounts of text and data. One type of these models is used for generative AI that creates text and images from user conversation prompts.
After a difficult six months that included job cuts, executive departures and public pressure from activist investors, Salesforce has regained the trust of many shareholders, with the stock up 62% by the end of Friday this year. . But investors are concerned about sales growth, especially after the company forecast on May 31 that sales for the current quarter will rise 10% year-over-year. This is the slowest rise on record and would be a significant drop from the days when 30% gains were the norm.
Executives talk about the potential for AI to drive expansion. Like cloud computing and mobile apps before it, generative AI “will trigger a massive new technology buying cycle,” CEO Marc Benioff said in a recent post-earnings call. Stated. Underscoring the company’s decision to prioritize AI is its decision last month to appoint Clara Shih as CEO of Salesforce AI. Shih previously led Service Cloud, Salesforce’s most profitable product segment.
Customers will pay extra to use the new generative AI capabilities across the company’s software suite, Kaplan said. He said Salesforce is still testing pricing levels, including whether it should be based on a flat-rate subscription or usage. The AI tools will be generally available in products for sales and customer support this summer, and will be rolled out across the portfolio in the coming months, the company said.
Salesforce previously introduced several generative AI tools using technology from OpenAI. This includes chatbots for tasks such as Slack business communication units and customer service draft responses.
Bloomberg Intelligence analysts estimated earlier this month that generative AI could generate $1.3 trillion in sales of hardware, software, services and other tools by 2032.
Previously, Caplan oversaw Salesforce’s Web3, blockchain and cryptocurrency efforts. He said the application of generative AI is much clearer than Web3, and customers have shown great interest.
Deutsche Bank analyst Brad Zelnick said in an investor note on Friday that Salesforce’s access to massive amounts of customer data could be a factor in the success of the highly touted new technology. Stated. “We believe that major platforms like his Salesforce, rich in trusted high-quality data, connected processes, strong brands, distribution and ecosystems, are the natural winners in the world of generative AI. I think it is.”
