I just came back from a business trip, and one recurring theme discussed with senior leaders was urgency around increasing productivity of the workforce. "Productivity" in this context means the ratio of outcomes-to-resource. In order of easier to harder to accomplish: cut cost of resources, same resources doing more, create more revenue. It is, then, no surprise that investment is piling into this current wave of AI. Of course, the infrastructure spending will be huge, but not irrational if you think about it as a giant societal cost-to-achieve exercise. The low hanging fruit of human off-shoring is already well-known and implemented (i.e., 1/3 cost --> 3x productivity). The promise of GenAI and AI agents is even greater multiples of productivity accomplished by taking out headcount in high-cost jurisdictions and making the rest who remain bionic in their capability. Everyone in their self-interest should be thinking about how are they placed relative to this secular trend. I think the outcomes will be K-shaped, with technology exacerbating the divergence of winners vs losers. In our finance industry, I believe the survivors will be the people who have mastery of these tools and can use them to leverage output, people who maintain relationships with people, and people who are innovating and creating meaningful change.
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Kara K.W. Byun
Head of Fintech
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Original Message:
Sent: 10-02-2025 11:51
From: Aya Pariy
Subject: Investments into AI increase - what does it mean?
Hello community,
We're entering the GenAI investment times quickly. Here's an article from FT today on how investments into AI.
French President Emmanuel Macron has announced €109bn worth of investments in artificial intelligence in France over the coming years, as Europe seeks a greater foothold in the fast-growing industry dominated by the US and China. Macron touted the new funding ahead of the AI Action Summit in Paris which starts on Monday, featuring discussions between world leaders and AI executives such as OpenAI's Sam Altman. It comes after US President Donald Trump last month hailed a $500bn AI infrastructure project known as Stargate, to be built in America and led by OpenAI and SoftBank.
On Monday, venture capital firm General Catalyst told the Financial Times it is leading a wider investment group that plans to spend €150bn over the next five years to deploy AI within companies, invest in European AI start-ups and build up critical infrastructure in the region. The plan, dubbed the EU AI Champions Initiative, is designed to "establish Europe as a global leader in AI". Other private equity and venture investors joining the initiative include KKR, Blackstone, EQT, CVC and DST Global.
I cannot help but think how this impacts emissions and climate change pace, that's more for CFA UK Sustainability community members.
What are your thoughts on this and how do you think it will impact your sector/space in the short and medium term?
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Aya Pariy
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