* Demand for artificial intelligence technology has been growing over the last five years and is poised to grow even faster due to the COVID-19 crisis, experts say.
* As businesses adapt to major changes caused by the crisis, they'll likely turn to AI technology to streamline operations and become more efficient, analysts and investors said.
* AI technology has helped businesses with tasks like making long-term sales growth projections to automating routine, time-consuming tasks.
* Two VCs say industry-specific AI software is especially poised to see strong growth and increased investment.
* Here are 12 startups that well-positioned to grow in a post-COVID world, including Tempus, Replicant, and Olive.
* Click here to read more BI Prime stories.
Artificial intelligence — once relegated to academic studies and sci-fi nerds — has become one of the hottest technologies, infiltrating every industry.
AI adoption was already accelerating before the COVID-19 crisis, but experts say that demand for AI tools is now is poised to grow even faster.
"The entire industry of AI is getting a huge boost from this unfortunate crisis," David Blumberg, founder and managing partner at Blumberg Capital, told Business Insider in May. "There is a silver lining to this dark cloud that we've all been living in for over two and a half, three months."
Former Cisco CEO John Chambers, who now runs his own venture firm JC2 Ventures, told Business Insider in an interview in May that he expects one to five major AI players to emerge from the current crisis.
AI has helped businesses take on big and small tasks, from making long-term sales growth projections to the automation of routine, time-consuming tasks. A 2019 Gartner survey found that major organizations planned to double their number of AI-related initiatives in the following year, from an average of 4 to 10. But as they pandemic has forced businesses to try to adapt to major changes, like the sudden pivot to remote work and tightening budgets, they're looking for ways to streamline and operate more efficiently.
"AI is best at solving all these really boring meat-and-potato problems," James Cham, a partner at Bloomberg Partners, told Business Insider. Many of the opportunities for using AI involve "straightforward process engineering," he said, where the technology can be used to shorten or streamline a process.
Industries like collaboration, shipping logistics, and manufacturing and warehousing will be particularly keen on using AI, said Sandeep Bhadra, a partner at Vertex Ventures.
Jake Saper at Emergence Capital had a similar prediction, that "vertical" specific AI software will be in more demand.
Here are 12 startups that analysts and investors say are well-positioned to grow thanks to a surge in demand for AI tools:
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Replicant
Funding: $8 million
Major Investors: Atomic, Norwest Venture Partners, Bloomberg Beta
Recommended by: James Cham, partner with Bloomberg Beta (investor)
Replicant develops AI-powered voice chat bots to help businesses handle customer queries and complaints.
The San Francisco-based startup launched in 2017, just in time to catch the surge in demand for customer support technologies, especially with the rise of delivery services companies.
Replicant was growing steadily before the pandemic, but has experienced even stronger demand during the crisis as more consumers turned to delivery services firms, Bloomberg's Cham said.
With many traditional call centers in lockdown, these delivery services companies turned to companies like Replicant to manage customer services, Cham said. There was "a dramatic uptick in demand," he told Business Insider.
Ferrum Health
Funding: $9 million
Major Investors: Blumberg Capital, GSR Ventures, Vulcan Capital
Recommended by: David Blumberg, managing partner at Blumberg Capital (investor)
Ferrum Health developed an AI-powered health monitoring system aimed at minimizing medical errors. The San Francisco-based startup analyzes medical records, such as chest X-rays or MRI scans, in order to catch critical medical details that a health care provider may miss.
Blumberg Capital's David Blumberg said Ferrum Health is helping address medical errors, which is a serious problem in health care. "Even the the best-trained, most well intentioned doctors will miss things," he said.
The COVID-19 crisis has led to the expanded role of technology in health care, highlighted by the sudden widespread use of telemedicine. Blumberg sees AI becoming a key part of that trend.
Cultivate
Funding: $10 million
Major Investors: Trinity Ventures, Bloomberg Beta
Recommended by: James Cham, partner at Bloomberg Beta (investor)
Cultivate helps businesses train better managers and develop a nurturing, employee-friendly environment.
The company's AI system scans and analyzes a company's data, including email and chat communications, and offers feedback on how to improve systems and interactions.
It's a "coaching tool at a scale you just can't imagine," Bloomberg's Cham said. A traditional management coach "isn't going to track my email flows, or note that you have an increasingly negative tone with Mary."
Replicant's tool has become even more valuable during the crisis when managers must offer guidance and leadership to employees working from home, he added.
"Managers don't know how to manage in this environment," he said. "This is such a different, complicated way of working. So managers are looking for any kind of guidance possible to say give me some feedback on how to do it."
Slync.io
Funding: $15.9 million
Major Investor: Blumberg Capital
Recommended by: David Blumberg, managing partner of Blumberg Capital (investor)
Slync.io helps businesses manage their global supply chain, by autonomously tracking their international shipping and freight forwarding operations.
The San Francisco-based startup is focused on a complex market with many moving parts, taking into account different regulatory bodies in multiple countries and even natural disasters, said Blumberg Capital's David Blumberg.
"It deals with multiple partners like warehousing companies, trucking, shipping, airplanes, trains," he told Business Insider. "There's so many 'what ifs' and different scenarios that have to be managed."
There are now more 'what ifs' to grapple with as a result of the crisis, which makes Slync.io's technology even more valuable, he added. It also underscores how AI has evolved from an academic field to a technology that's addressing basic needs.
"It's actually working in the operational day-to-day management of truck containers and ships and railroads that move goods and keep us fed, housed and warm," he said.
Uniphore
Funding: $67 million
Major Investor: JC2 Ventures
Recommended by: John Chambers, CEO of JC2 Ventures (investor)
Uniphore uses voice AI to help businesses improve customer calls and relationships. Founded in India in 2008, the startup moved its headquarters to Silicon Valley late last year.
CEO Umesh Sachdev described the move as "a big personal risk" in an interview with Business Insider last year.
"Let's say something goes wrong and this fails," he told Business Insider in an interview last year. "I'm putting all my so far success on this new big risk."
Like other startups, Uniphore has taken a hit from the COVID-19 downturn. But one of its top investors, John Chambers, predicted that Uniphore will emerge from the crisis as a major player in AI.
Guru
Funding: $68 million
Major Investors: Emergence Capital, Accel, Salesforce Ventures, Slack
Recommended by: Jake Saper, partner at Emergence Capital (investor)
Guru uses browser extensions and Slack plugins powered to make sure the information that workers need to do their jobs "finds them wherever they need it," according to Saper. It finds data across a worker's set of cloud apps and surfaces it directly into whatever workflow tool a user is currently in.
The company raised a $30 million Series C round led by Accel in April. Guru is "poised for continued acceleration in 2020" because it is critical to helping remote and distributed teams get work done, Saper said.
Deep Instinct
Funding: $92.1 million
Major Investors: Millennium Technology Partners, Blumberg Capital
Recommended by: David Blumberg, managing partner at Blumberg Capital (investor)
New York-based Deep Instinct uses AI to identify cybersecurity threats and competes with security companies like McAfee and Crowdstrike.
Deep Instinct's platform is based on deep learning, the branch of AI that enables a computing system to process data and signals and organize the information similar to the way human memory operates.
Blumberg of Blumberg Capital said that Deep Instinct has been building a massive database of malware and other threats which enables it to flag threats that "have never been seen before."
Olive
Funding: $123.8 million
Major Investors: General Catalyst, Kholsa Ventures, Drive Capital
Recommended by: Jake Saper, partner at Emergence Capital (no relationship)
Olive.ai sells hospital administration software to make hospital systems run more efficiently, and therefore reduce the overall cost of running a hospital.
It can automate some of the most redundant, data-heavy tasks in healthcare, like prior authorizations, insurance verifications, and account updates.
The company raised $51 million in Series E funding in April in a round led by General Catalyst and says it was already seeing massive growth even before the coronavirus pandemic hit.
The product is likely to see a surge in demand due to the pandemic, said Emergence Capital's Saper.
"You could imagine that the verticals that are really impacted by COVID are going to see acceleration in AI-related efficiency driven solutions," Saper said.
C3.ai
Funding: $355.74 million
Major Investors: Shell ventures, Breyer Capital, Sutter Hill Ventures
Recommended by: Jake Saper, partner at Emergence Capital (no relationship)
C3.ai sells software for predictive analytics and big data analysis, including for IoT devices, among other things, and was founded by Tom Siebel, who wrote the book on digital transformation.
C3.ai has previously been focused on targeting industries like electric utilities, oil and gas, and manufacturing. Those are industries that are likely being forced to modernize rapidly right now, said Saper.
"In the near term, while we're trying to have less people putting themselves at risk in a densely populated work environment, you could imagine a world where there's a bigger investments in AI driven solutions that can keep people safer by not having them in the field," he said.
Graphcore
Funding: $460 million
Major Investors: Sequoia, Dell Technologies Capital
Recommended by: Scott Darling, president of Dell Technologies Capital (investor)
What it does: AI technologies are data-hungry systems that require powerful processors with massive computing power. Traditional chipmakers led by Intel and Nvidia are trying to address that need, but AI chip startups have emerged as well.
One of them is Graphcore, which Scott Darling of Dell Technologies Capital says "may fundamentally redefine what the silicon looks like for machine learning."
Tempus
Funding: $620 million
Major Investors: Novo Holdings, New Enterprise Associates, T. Rowe Price
Recommended by: Dan Newman, analyst at Futurum Research
Tempus gathers and analyzes big pools of medical and clinical data to deliver personalized care for patients.
Healthcare and biotechnology are sectors that will likely see increased investment due to the current pandemic, said Dan Newman, an analyst at Futurum Research.
"Biotech and healthcare is in this interesting crosshairs with COVID, but on the backend of this we're going to accelerate a lot of investment in health," Newman said.
Tempus closed a $100 million funding round led by Novo Holdings, New Enterprise Associates and Baillie Gifford in early March.
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