Rare species

Startup unicorns remain a rare species in the current business environment, with the number of tech upstarts valued at $1 billion or more having fallen from its peak in 2021.

For example, Orlando has but one unicorn, Stax Payments, which achieved its sky-high valuation on March 8, 2022. If the merger of Falcon’s Beyond and FAST Acquisition Corp. II works out later this year, it will be Orlando's second unicorn.

However, the next tech startup to hit this milestone might be one of the artificial intelligence-driven companies growing in the region. That's because of the 20 North American startups to raise funding at a $1 billion-plus valuation in 2023, half are artificial intelligence (AI) firms, according to data shared by Pitchbook Data Inc., a firm that tracks venture funding totals across the country.

The continued investment in AI startups in 2023 follows last year's hot streak for AI firms amid a general downturn for much of the rest of the tech industry. For example, generative AI, the type of artificial intelligence that creates text, images and other content in response to prompts, saw a record year for investment in 2022, according to a recent report from business-analytics platform CB Insights.

Winter Garden AI company gets funding

Winter Garden-based Orson, an AI-driven content creation startup, announced June 20 that it has raised $3 million from private funding sources to deepen its investment in generative AI and the science of video storytelling to help users build meaningful human connections, bringing its total of funds raised to $8 million since launching in 2020. 

The company’s primary offering, StoryStrip, features an AI director asking the user questions to elicit a story. Once the user is satisfied with the takes, the application makes AI-driven edits and incorporates pre-loaded visuals and music to produce a final cut.

CEO John Ehrhard said his company’s products, which will be sold as elements to be incorporated into existing social and professional platforms, have personal and professional uses: “I started creating Mother's Day videos with my kids for my wife and doing life documentaries of my 96-year-old grandmother and father-in-law before they passed away, and I got to see the impact of that in everyday life. Others noticed the impact, too, and wanted me to do the same thing for their families, and I soon realized I needed to figure out a way to democratize this so everybody could have it.”

In addition to social uses, Ehrhard envisions professional teams creating videos that help them connect with and better understand their colleagues. Stories also can be created and shared for marketing purposes.

“People generally suck at communicating and are terrible storytellers, but they have been equipped with technology to capture their stories digitally and share them with the world,” Ehrhard said.

In a prepared statement, Eli Weinstock-Herman, Orson’s CTO and technical co-founder, explained how and why Orson will use the new funding: “This funding helps us continue to expand from our beta last fall, adding new storytelling capabilities, expanding to more audiences, and continuing to develop AI capabilities for our automated director.”

Generative AI may be the hottest trend, but AI factors into product and service development in many ways. 

AI-powered business consulting in Orlando

Orlando-based SplusM is a versatile company that develops models informed by machine learning and AI, with innumerable applications in the business world.

Founded in 2021, the firm’s office is at the UCF Business Incubator at Research Park, a community of early-stage innovation companies led by a tight-knit team. The new firm has found support for its business operations and development as it focuses on transportation and mobility.

"We have been seeing early-stage companies with innovative uses of AI for several years now," said Carol Ann Logue, director for all eight incubator and innovation district locations (soon to be nine when the Eustis branch opens later this year). "The application of AI has accelerated, however, across a wider range of areas. We have clients developing AI-based solutions for smart transportation, location tracking, simulation and training, energy management and medical diagnostics. It will only continue to grow."

SplusM Technical Project Manager Sam Mahdavian explained that the core of the firm's work is to analyze data, make models to understand patterns and help businesspeople make better decisions informed by AI models. 

Dual-use solutions derived from a buffet of technologies

C2 Technologies, another client of the UCF incubator, similarly harnesses a variety of technologies including AI to develop solutions in more than one space. Technologies and their applications are emerging and morphing so rapidly that the company unlocks relevant new opportunities and quickly staffs up to capitalize on them as needed. 

For example, the company recently teamed up with Orlando-based AVT Simulation to form ATSP Joint Venture and win a piece of a $32.5 billion, multi-award, indefinite-delivery/indefinite-quantity contract that involves other businesses. In layman’s terms, the U.S. Air Force has access to ATSP Joint Venture and the other businesses for the next 10 years whenever it has a need for products and services relevant to training, engineering, software development, analysis, design, development, production, installation, integration, testing, sustainment and instruction. 

C2 Technologies is headquartered in McLean, Virginia, but CEO Dolly Oberoi said, “all that work will be done out of Orlando. It's designed to be that way. We look forward to hiring 100 or even 200 people, because these are large contract awards.” 

A view of the unicorn landscape reveals that the AI companies with the designation have a focused deliverable or clearly defined activity, typically in the content space. Jasper is an AI writer and art generator. Stable Diffusion is a deep learning text-to-image generator. Runway is an applied AI research company shaping the next era of art, entertainment and human creativity. Cohere powers interactive chat features, generates text for product descriptions, blog posts and articles, and captures the meaning of text for search, content moderation and intent recognition.

Time will tell whether AI-driven businesses that don’t emphasize content can populate the unicorn universe the way content companies do. 

Either way, regarding the sky-high valuations AI companies have garnered, revenue appears to be optional — at least for now. AI startup Rewind raised capital at a $350 million valuation in May with only $700,000 in revenue, according to The Information. LangChain, another AI startup, raised funding at a $200 million valuation with only "minimal" revenue, according to Business Insider.

Emerging AI areas

Below is a list of emerging trends in AI and machine learning compiled from Analytics Vidhya, a community-based knowledge portal for Analytics and Data Science professionals:

Natural language processing

Computer vision

Deep learning

Explainable AI

American Inno's National Editor Jim Dalke contributed to this report.

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