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Menlo's 2024 Enterprise AI Report -- hot off the press! 🔥 Enterprise AI spending is continuing to grow - up 6x now from 2023 at a staggering $13.8B. To call out a few findings 🔎 - AI's scope has broadened to every department. Enterprises note the most valuable use-cases are in code copilots, support chatbots, enterprise search / data extraction, and meeting summarization. While every department has received a chunk of the enterprise AI budget (IT, support, marketing, sales, etc.), the technical departments still command the largest share of generative AI spend. - With all this spend, enterprises need something clearly valuable and relevant. Decision-makers rank having 'easily quantifiable ROI' and 'customizability' as the top 2 factors when selecting generative AI tools. - 2024 is the year of vertical AI applications. Healthcare, legal, financial services as well as media and entertainment continue to see a number of vertical AI applications tailored to their needs. - Foundational models continue to make-up the bulk of AI investments, especially as enterprises move toward multi-modal approaches. Read more about it here: https://lnkd.in/gamn_YG6 CC Tim Tully, Derek Xiao, Joff Redfern, Claude Sonnet 3.5 😊 🚀

At Menlo Ventures, we’ve witnessed the enterprise AI landscape transform at breakneck speed. Generative AI, once a frontier technology, is now a foundational business tool driving real-world impact across industries. Our latest report, The State of Generative AI in the Enterprise, highlights key insights and trends: 🚀 AI Spending Takes Off Enterprise AI spending surged to $13.8 billion in 2024, up from $2.3 billion in 2023—a testament to the shift from pilot projects to production-grade implementations. ⚙️ Top Use Cases Driving ROI From code copilots and chatbots to enterprise search and meeting summarization, generative AI is transforming workflows and boosting productivity. 📈 Applications and Infrastructure on the Rise The application layer saw $4.6 billion in investment this year, while the modern AI stack continues to evolve with multi-model strategies, RAG, and agentic architectures. These shifts aren’t just theoretical—they’re tangible, transformative, and happening now. Across our portfolio—companies like Anthropic, Benchling, Eleos Health, OpenSpace, Harness, Pinecone, Typeface, Vilya, and Xaira Therapeutics —we’re seeing the impact of AI on industries from healthcare to manufacturing, security, and beyond. At Menlo, we backed the infrastructure that made this possible. Now we're doubling down on applications that will reshape entire industries. The opportunity to build transformative AI companies has never been better. For more details on what is happening in AI, where the industry is headed, and three predictions for what happens next, read: https://lnkd.in/grj-_bYD Authored by Tim Tully, Joff Redfern, and Derek Xiao with a little bit of help from Claude Sonnet 3.5 #AI #GenerativeAI #EnterpriseAI #VentureCapital #MenloVentures

We’re excited to share our latest research, the 2024 State of Generative AI in the Enterprise. Our report dives deep into how businesses are adopting and investing in AI + our predictions for what lies ahead. Some highlights: - AI spending jumped to $13.8 billion in 2024, up 6x from what we reported in 2023 - 72% of leaders expect accelerated adoption - Enterprise spending for AI-native applications surged to $4.6 billion in 2024, an almost 8x increase from the $600 million spend we reported in 2023 - Key sectors leading adoption: Healthcare (captured $500M in spending), Legal Services ($350M), Financial Services and Media gaining momentum ($100M each) Take a look at the full report 👉 https://lnkd.in/gJi-88hE We're excited about founders and products addressing the app-layer and infrastructure stack. Reach out if you're building something here or ideating!

The recent insights from Menlo Ventures highlight a remarkable shift: generative AI is moving beyond pilots to become a cornerstone of enterprise innovation. Budgets are flowing into departments across IT, product, and even customer-facing teams, showing the vast potential of AI to reshape operations. https://lnkd.in/grj-_bYD At IQLUS, we are already collaborating with organizations to bring generative AI into their core workflows - enhancing efficiency, enabling smarter decision-making, and addressing domain-specific challenges. For instance: 🔹 Vertical AI Applications: Generative AI solutions tailored to healthcare, financial services, and other industries are delivering immediate value by streamlining complex, high-stakes processes. https://lnkd.in/dqbfGNgu 🔹 AI Governance & Security: As Menlo Ventures points out, ensuring robust data governance and mitigating risks like prompt injection attacks are critical to responsible adoption. https://lnkd.in/dMa9CmfV Generative AI is no longer just a buzzword - it’s a powerful tool for tackling real-world challenges. For enterprises, this is the moment to think strategically about scaling AI with a focus on security, compliance, and measurable ROI. 𝐇𝐨𝐰 𝐢𝐬 𝐲𝐨𝐮𝐫 𝐨𝐫𝐠𝐚𝐧𝐢𝐳𝐚𝐭𝐢𝐨𝐧 𝐢𝐧𝐭𝐞𝐠𝐫𝐚𝐭𝐢𝐧𝐠 𝐀𝐈 𝐢𝐧𝐭𝐨 𝐢𝐭𝐬 𝐰𝐨𝐫𝐤𝐟𝐥𝐨𝐰𝐬? 🚀 #GenerativeAI #EnterpriseInnovation #AITransformation #IQLUS

Interesting report Menlo Ventures. The application layer is heating up, and a tremendous greenfield opportunity exists. 12x YOY increase in spending on vertical AI is the highest among all categories. The top two selection criteria for Gen AI tools by enterprises are "Quantifiable ROI" and "Customizable Gen AI".

In 2024, generative AI became mission-critical for enterprises, with spending surging to $13.8 billion—over six times that of 2023. This significant investment indicates a shift from experimentation to execution, as 72% of decision-makers anticipate broader adoption of AI tools. However, more than a third lack a clear vision for implementation, highlighting that many are still navigating this large-scale transformation. Enterprises are integrating AI into core strategies, with 60% of investments from innovation budgets and 40% from permanent allocations. The application layer is experiencing rapid growth, attracting $4.6 billion—almost eight times last year's amount. Top use cases delivering tangible ROI include code copilots, support chatbots, enterprise search, data transformation, and meeting summarization. Organizations prioritize value and industry-specific customization over price when selecting AI tools. Vertical AI applications are gaining traction in sectors like healthcare, legal, financial services, and media. The modern AI stack is stabilizing, with enterprises adopting multi-model strategies and focusing on design patterns like retrieval-augmented generation (RAG). OpenAI's market share decreased from 50% to 34%, while competitors like Anthropic gained ground. Predictions for the future include the rise of agentic automation driving the next wave of transformation, increased startup disruption of incumbents, and an intensifying AI talent shortage. Menlo Ventures is actively investing in this transformative landscape, supporting companies that leverage AI to reshape industries.

One trend stands out in the latest State of Generative AI in the Enterprise report from Menlo Ventures: the emergence of AI agents. 2024 marks the year that generative AI became a mission-critical imperative for the enterprise. AI spending surged to $13.8 billion this year, more than 6x the $2.3 billion spent in 2023—a clear signal that enterprises are shifting from experimentation to execution, embedding AI at the core of their business strategies. Key takeaways: 1. Significant Increase in AI Investment: Enterprise spending on AI surged to $13.8 billion in 2024, a substantial increase from $2.3 billion in 2023. This sixfold growth indicates a shift from experimental phases to the integration of AI into core business strategies 2. Transition from Innovation to Core Budgeting: Currently, 60% of generative AI investments are sourced from innovation budgets. However, the remaining 40% comes from core budgets, with 58% of that redirected from existing allocations, demonstrating a commitment to AI as a fundamental business tool 3. Emergence of AI Agents: The report highlights the rise of AI agents capable of complex reasoning and multi-step actions, moving beyond traditional bots to enable end-to-end process automation. As we look to the future, it's clear that AI agents will drive the next wave of enterprise transformation. At Clinch AGI, we're at the forefront of this transformation. They have the potential to disrupt not only the $400 billion software market but also make significant inroads into the $10 trillion U.S. services economy. How is your organization preparing for this shift? Let's discuss the future of work and how we can harness the power of AI to create more efficient, innovative, and productive businesses. https://lnkd.in/ejX8vGcZ #AIAgents #EnterpriseAI #FutureOfWork #AITransformation #MenloVentures #GenAI #ClinchAGI

A good study by Menlo Ventures how Generative AI is moving from experimental pilot programs to production in enterprises, with 2024 marking significant adoption. AI spend jumped to $13.8 billion, driven by its integration into business strategies and productivity-enhancing applications like coding assistants, chatbots, and enterprise search tools. Enterprises continue to prioritize ROI and customization, with both startups and incumbents competing to address growing demands. Emerging trends include the rise of autonomous agents and domain-specific AI applications. Despite rapid progress, challenges like talent shortages and technical integration with legacy systems persist.

🚀 𝟮𝟬𝟮𝟰: 𝗧𝗵𝗲 𝗬𝗲𝗮𝗿 𝗼𝗳 𝗚𝗲𝗻𝗲𝗿𝗮𝘁𝗶𝘃𝗲 𝗔𝗜 𝗶𝗻 𝘁𝗵𝗲 𝗘𝗻𝘁𝗲𝗿𝗽𝗿𝗶𝘀𝗲 🚀 As we dive into 2024, the landscape of generative AI is evolving at an unprecedented pace! 🌟 Here are some key insights from Menlo Ventures latest report on the state of generative AI in enterprises: 🔹 Massive Investment Surge: Enterprise spending on generative AI has skyrocketed to $13.8 billion, a staggering 6x increase from 2023! 🔹 Widespread Adoption: A remarkable 72% of decision-makers expect broader adoption of these transformative tools, with 60% of investments coming from innovation budgets. 🔹 Top Use Cases: Code Copilots (51%) Support Chatbots (31%) Enterprise Search & Retrieval (28%) Data Extraction & Transformation (27%) Meeting Summarization (24%) 🔹 Emerging Trends: We're seeing a shift towards autonomous AI-powered agents that handle complex, end-to-end processes. Interestingly, the balance between in-house development (47%) and vendor solutions (53%) is nearly even. 🔹 Challenges Ahead: Implementation costs (26%), data privacy concerns (21%), and disappointing ROI (18%) are significant hurdles that enterprises face. 🔹 Industry Leaders: Healthcare leads the charge with a whopping $500 million in enterprise spend, followed by the legal industry at $350 million. 🔹 Infrastructure Insights: Enterprises are deploying multiple foundation models, with OpenAI's market share decreasing to 34%, while Anthropic has doubled to 24%. #GenerativeAI #ArtificialIntelligence #Innovation #EnterpriseTech #DigitalTransformation #AITrends #FutureOfWork https://lnkd.in/grj-_bYD

𝐓𝐡𝐞 𝐒𝐭𝐚𝐭𝐞 𝐨𝐟 𝐆𝐞𝐧𝐞𝐫𝐚𝐭𝐢𝐯𝐞 𝐀𝐈 𝐢𝐧 𝐭𝐡𝐞 𝐄𝐧𝐭𝐞𝐫𝐩𝐫𝐢𝐬𝐞 – 2024 𝐈𝐧𝐬𝐢𝐠𝐡𝐭𝐬 Generative AI is no longer a buzzword—it’s a strategic tool shaping the future of enterprises. A recent report by Menlo Ventures highlights the key trends, challenges, and opportunities in the generative AI space for 2024. Here are some key takeaways: ✴️ Adoption Acceleration: Enterprises are integrating generative AI across functions, from automating repetitive tasks to enhancing creativity and decision-making. ✴️ Code Generation Leads the Way: One of the most impactful applications of generative AI is in code generation, where AI models are transforming software development by accelerating workflows, reducing errors, and enabling teams to focus on higher-value tasks. ✴️ Challenges in Scaling: Many organizations face hurdles in implementing AI models, such as cost management, talent shortages, and ensuring robust data infrastructure. ✴️ Shift Towards Specialized Models: There’s growing interest in domain-specific AI solutions that cater to unique business needs, offering deeper impact compared to generic models. ✴️ Trust and Governance: Concerns around ethical AI, transparency, and regulatory compliance remain at the forefront, pushing enterprises to invest in responsible AI practices. The report emphasizes that while the potential is vast, realizing it requires a focused strategy, effective tooling, and collaboration across teams. As we move into 2024, it’s evident that generative AI is no longer just transforming industries—it’s redefining how enterprises operate and compete. For those of us working in this space, this is an exciting time to collaborate, innovate, and push the boundaries of what’s possible. What’s your take on generative AI’s role in enterprises for 2024? Let’s discuss in the comments! Full report here: https://lnkd.in/eXk6TcMd #genai #productivity #llm