Category: AI

Is Big Data Still a Thing? (The 2016 Big Data Landscape)

 

In a tech startup industry that loves its shiny new objects, the term “Big Data” is in the unenviable position of sounding increasingly “3 years ago”.   While Hadoop was created in 2006, interest in the concept of “Big Data” reached fever pitch sometime between 2011 and 2014.  This was the period when, at least in the press and on industry panels, Big Data was the new “black”, “gold” or “oil”.  However, at least in my conversations with people in the industry, there’s an increasing sense of having reached some kind of plateau.  2015 was probably the year when the cool kids in the data world (to the extent there is such a thing) moved on to obsessing over AI and its many related concepts and flavors: machine intelligence, deep learning, etc.

Beyond semantics and the inevitable hype cycle, our fourth annual “Big Data Landscape” (scroll down) is a great opportunity to take a step back, reflect on what’s happened over the last year or so and ponder the future of this industry.

In 2016, is Big Data still a “thing”? Let’s dig in.

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The Power of Data Network Effects

In the furiously competitive world of tech startups, where good entrepreneurs tend to think of comparable ideas around the same time and “hot spaces” get crowded quickly with well-funded hopefuls, competitive moats matter more than ever.  Ideally, as your startup scales, you want to not only be able to defend yourself against competitors, but actually find it increasingly easier to break away from them, making your business more and more unassailable and leading to a “winner take all” dynamic.  This sounds simple enough, but in reality many growing startups, including some well-known ones, experience exactly the reverse (higher customer acquisition costs resulting from increased competition, core technology that gets replicated and improved upon by competitors that started later and learned from your early mistakes, etc.).

While there are various types of competitive moats, such as a powerful brand (Apple) or economies of scale (Oracle), network effects are particularly effective at creating this winner takes all dynamic, and have been associated with some of the biggest success stories in the history of the Internet industry.

Network effects come in different flavors, and today I want to talk about a specific type that has been very much at the core of my personal investment thesis as a VC, resulting from my profound interest in the world of data and machine learning: data network effects.

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The Astounding Resurrection of AI [Slides]

A few days ago, I was invited to speak at a Yale Entrepreneurship Breakfast about about one of my favorite areas of interest, Artificial Intelligence.  Here are the slides from the talk — a primer on how AI rose from of the ashes to become a fascinating category for startup founders and venture capitalists.  Very much a companion to my earliest post about our investment in x.ai.   Many thanks to my colleague Jim Hao, who worked with me on this presentation.

x.ai and the emergence of the AI-powered application

AI is experiencing an astounding resurrection.  After so many broken promises, the term “artificial intelligence” had become almost a dirty word in technology circles.  The field is now rising from the ashes.  Researchers who had been toiling away in semi-obscurity over the last few decades have suddenly become superstars and have been aggressively recruited by the largest Internet companies:  Yann LeCun (see his recent talk at our Data Driven NYC event here) by Facebook; Geoff Hinton by Google; Andrew Ng by Baidu.  Google spent over $400 million to acquire DeepMind, a 2 year old secretive UK AI startup. The press and social media are awash with thoughts on AI.  Elon Musk cautions us against its perils.
What’s different this time? As Irving Wladawsky-Berger pointed out in a Wall Street Journal article, “a different AI paradigm emerged. Instead of trying to program computers to act intelligently–an approach that hadn’t worked because we don’t really know what intelligence is– AI now embraced a statistical, brute force approach based on analyzing vast amounts of information with powerful computers and sophisticated algorithms.”  In other words, the resurgence of AI is partly a child of Big Data, as better algorithms (in particular, what’s known as “deep learning”, pioneered by LeCun and others) have been enabled by larger than ever datasets and the ability to process those datasets at scale at reasonable cost.

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The State Of Big Data in 2014: a Chart

Note: This post appeared on VentureBeat, here.

It’s been almost two years since I took a first stab at charting the booming Big Data ecosystem, and it’s been a period of incredible activity in the space. An updated chart was long overdue, and here it is:

(click on the arrows at the bottom right of the screen to expand)

A few thoughts on this revised chart, and the Big Data market in general, largely from a VC perspective:

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