Researcher ORCID Identifier

0009-0002-5851-3987

Graduation Year

2024

Date of Submission

4-2024

Document Type

Campus Only Senior Thesis

Degree Name

Bachelor of Arts

Department

Economics

Reader 1

William Lincoln

Rights Information

© 2024 Alua Telemtayeva

Abstract

This thesis investigates the behavior of venture capital (VC) investments in artificial intelligence (AI) within the United States from 2019 to 2023, focusing on the implications of the COVID-19 pandemic on investment trends. The study utilizes a comprehensive methodology that integrates quantitative data analysis from databases such as CB Insights and OECD.AI with qualitative insights from industry reports and academic journals to explore the shifts in investment patterns across various industries and investor types.

The research findings demonstrate a significant hike in VC investments in AI in 2021, followed by a subsequent adjustment period. In recent years, data shows an increasing inflow of investments towards AI technologies in sectors including media, social platforms, and IT infrastructure, suggesting a pivot to support digital frameworks and content engagement. The study also highlights a sustained focus on early-stage startups throughout the observed period, with Silicon Valley as the primary driver of VC investments in AI. The analysis also explores the investment behaviors of different investors, namely traditional VC firms, corporate venture capitalists, and corporate investors, offering insights into variations in their approaches and how they adapted to a rapidly changing technological environment.

This thesis contributes to the broader understanding of the relationship between rapid technological advancement and capital inflow, providing an in-depth analysis of the mechanisms influencing VC investment in AI during a period of significant global disruption, particularly focusing on the United States. The findings have implications for investors, industry stakeholders, and policymakers, grounding observations in existing economic theories and aligning them with broader industry trends in a fundamentally digitalized business environment.

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This thesis is restricted to the Claremont Colleges current faculty, students, and staff.

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