June 18, 2024
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Mercado: Region’s AI scene highlights diversity among tech companies

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A lot of the focus on the technology scene along the Central Coast this year has been on biotechnology — and rightfully so given the sprawl we are seeing pop up in the Conejo Valley.

But something that isn’t quite so obvious on the surface is the amount of artificial intelligence you could find up and down the tri-county area.

It shouldn’t come as such a surprise — after all, it feels more and more like a necessity that any type of technology company has to have an AI component it could tout to investors rather than it being the cherry on top.

Jorge Mercado

No, AI platforms, and the investments being made into the industry, are becoming the whole sundae for technology companies.

But it’s important to see the positives, the negatives and the overall trend we are seeing here on the Central Coast from this AI investment strategy that seems to be taking over the market.

Now when people hear AI nowadays, I think the thing that instantly pops into their heads is ChatGPT and similar platforms in which users can enter prompts and receive a ton of information back in a matter of seconds.

AppFolio is a good example of this. 

A software company for the entire real estate industry, AppFolio has been heavily investing in its AI platform for years.

In its most recent earnings call, the company said it would be leading the charge on a new conversational interface powered by large language models that will allow customers to engage and, in a perfect world, make their job easier.

Private companies like Santa Barbara-based Invoca also have a similar story. The company is a leader in AI-powered conversation intelligence for revenue teams and those investments have driven that company beyond a unicorn valuation of $1 billion.

But it’s also important to note just the amount of AI that is in the area and the slight differences between companies.

For AppFolio and Invoca, their AI language platforms make life easier for users.

But for a company like Cognixion, its ÅI platform literally gives a voice to the voiceless.

Cognixion, a Santa Barbara-based company, has developed a product, Cognixion One, which is an assisted reality device that leverages artificial intelligence, augmented reality and assistive technology to help people with severe motor impairments communicate and interact more effectively and independently with the world around them.

The device is able to read the user’s brain activity while sending control signals back to the augmented reality application, allowing users to communicate hands-free and voice-free — a truly life-changing device that will hopefully come to market soon.

And over at UC Santa Barbara, we saw they recently received a heavy investment to form an AI cybersecurity team. 

Our Mike Harris noted that UCSB will be leading a multi-university project to develop artificial intelligence solutions to enhance cyber security to protect the nation’s infrastructure from malicious actors.

The point being AI is good for more than just chatbots, it quite literally can change entire lives.

Google’s Quantum Computing Lab in Goleta proves just that.

Quantum Computing — in the simplest of terms that still might make the average person’s head spin — is a rapidly-emerging technology that harnesses the laws of quantum mechanics to solve problems too complex for classical computers.

When it comes to fruition, the entire status of economics, drug development, supply chain issues could become a thing of the past — or at least take on a new form.

And it would be scientists at the Goleta facility that played a huge role in that.

And while this has mostly felt Santa Barbara-focused, the fact is new startups are popping up regularly along the Central Coast with an AI component.

Our Jake Piazza recently spoke with Beacon Economics practice lead Samuel Maury-Holmes — an article that is a must-read for any of you.

But to quickly summarize, at least 14 tri-county AI and machine learning companies have received venture capital funding since the start of 2022 — the key word there being at least.

Even a company that’s relatively unknown, Snappt in Ojai, raised $100 million in Series A funding. 

Similar companies in the region like Theta Lake raised $51.5 million and in total, we saw AI companies on the Central Coast raise about $176.5m last year. 

That means even in a venture capital market where we see investors being a bit more conservative, AI companies are still able to take home a big piece of the pie. 

Now one of the problems with AI — beyond the fear that The Terminator’s plot will become reality — is job security.

The World Economic Forum projects artificial intelligence will replace some 85 million jobs by 2025.

While not confirmed, it has been heavily noted that AppFolio’s 62 layoffs this year were due to its AI platform becoming so good, the workers were no longer needed.

So far, that’s the only possible example that we have seen along the Central Coast, but with rapid technological advancement always comes the possibility that the workforce will adapt and change.

We will see how these investments to AI along the Central Coast will transform the arena.

Jorge Mercado covers technology for the Pacific Coast Business Times. He can be reached at jmercado@pacbiztimes.com.