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Small Investors Pile In to AI Start-Ups Amidst Tech Titan Competition ChatGPT


The competition between tech titans Alphabet (Google’s parent company) and Microsoft to secure leadership in the next big driver of growth has caused small investors to pile into small-cap firms that employ artificial intelligence.

The viral success of ChatGPT is a sign of the growing focus on AI on Wall Street, reminiscent of the blockchain hype from a few years ago when shares of companies remotely associated with the technology surged.

According to Vanda Research, $3bn (€2.8bn) AI software firm C3.ai was the fifth most actively traded on Fidelity’s platform for small investors this week and drew record daily retail inflows worth $31.4m. This has caused many people to wonder why such an influx is happening now, and what it means for tech giants like Alphabet and Microsoft who are competing for the lead in this area.

Small-cap firms investing in AI are a much larger part of their business than larger ones, according to Matthew Tuttle, chief executive officer of Tuttle Capital.

With more money pouring into these smaller companies, there is a greater chance for them to grow and gain prominence in the industry. This means that they are not only able to compete with tech titans but also have more resources available to develop new technologies and products that could surpass those offered by their larger competitors.

The rise of AI start-ups has been met with equal skepticism as well as enthusiasm; while some believe that they will be able to outpace their larger rivals, others feel that they may be too small and inexperienced to be truly competitive in the long run.

That being said, there is no denying that small investors are confident about this sector, as evidenced by their willingness to pour large sums into these companies despite their size.

It is clear that small investors have high hopes for AI start-ups amidst intensified competition between technology titans Google parent Alphabet and Microsoft for leadership in the next major driver of growth AI technology by pouring millions into these companies despite their smaller size compared to their giants rivals.