By Kyle Wiggers
By 2025, more than 75% of venture capital and early-stage investor executive reviews will be informed by AI and data analytics. In other words, AI might determine whether a company makes it to a human evaluation at all, de-emphasizing the importance of pitch decks and financials. That’s according to a new whitepaper by Gartner, which predicts that in the next four years, the AI- and data-science-equipped investor will become commonplace.
Increased advanced analytics capabilities are shifting the early-stage venture investing strategy away from “gut feel” and qualitative decision-making to a “platform-based” quantitative process, according to Gartner senior research director Patrick Stakenas. Stakenas says data gathered from sources like LinkedIn, PitchBook, Crunchbase, and Owler, along with third-party data marketplaces, will be leveraged alongside diverse past and current investments.
“This data is increasingly being used to build sophisticated models that can better determine the viability, strategy, and potential outcome of an investment in a short amount of time. Questions such as when to invest, where to invest, and how much to invest are becoming almost automated,” Stakenas said. “The personality traits and work patterns required for success will be quantified in the same manner that the product and its use in the market, market size, and financial details are currently measured. AI tools will be used to determine how likely a leadership team is to succeed based on employment history, field expertise, and previous business success.”
Continue reading… “Gartner: 75% of VCs will use AI to make investment decisions by 2025”

