The new fund will invest in early-stage artificial intelligence (AI) startups and other firms focusing on cutting-edge science, known as “deep tech.” “Our focus will be on the U.S. and Israel,” co-founder Jeff Herbst told Reuters. He said GFT will help its investments to scale by connecting them to prominent global players that can provide technology, market access, and growth opportunities for their businesses.
Founded by former Nvidia and Samsung executives, GFT is one of several new venture funds that have raised capital for frontier technology startups. These investors see the sector as a potential driver of future economic growth. “It’s a very high-growth area; it has the potential to create huge companies and jobs,” Herbst said. He added that automating tasks could also help companies develop products more efficiently and potentially save time and money.
But the sector is already expensive and crowded, with valuations on some AI firms reaching what venture capital investors politely call frothy levels. That hasn’t deterred some large companies, including Salesforce, SAP, and China’s Baidu, from putting big dollars into AI funds. Earlier this month, Luxembourg-based Lux Capital Management raised $1.1 billion across two funds focused on investing in these companies.
In the United States, venture capital firms focus on AI and other technologies, transforming industries and changing consumer behaviors. New Mexico is positioned for growth in those sectors because of emerging innovation at the state’s national labs and research universities, said the State Investment Council director, overseeing the fund that will back GFT.
Last November, the SIC invested $100 million in the America’s Frontier Fund, a private equity program that funnels SIC money into venture funds that commit to investing in New Mexico companies. It also committed another $97.5 million to two funds managed by Playground Global and Lux Capital Management to invest in “frontier technology” like advanced computing and artificial intelligence, SIC Director of Private Equity Chris Cassidy told members of the state’s Senate on Tuesday.
The SIC’s commitments for these funds come from the $135 million the SIC invested in two other technology-focused venture firms in November. Its investment in the AFF and these two funds, combined with the SIC’s other private equity programs, puts it at the forefront of funding for New Mexico technology.
In an in-depth interview with Global Venturing, Herbst discussed his views on AI ecosystem development and other frontier technology investment themes.
