NXAI, a company involved in research, is also concentrating on product development. According to the company’s managing director, Albert Ortig, they aim to bring their technological advancements into the economy. This is achieved in collaboration with Hochreiter and Pierer Digital Holding, a company owned by industrialist Stefan Pierer. Netural, owned by Ortig, is also a key player in this venture.
Ortig envisions numerous applications for their work including industrial automation, programming, materials research, and medicine. He emphasizes on focusing on sectors where their technological edge can enhance the value of the product.
With this approach, NXAI joins a group of promising European start-ups, such as Germany’s Aleph Alpha and France’s Mistral AI. These companies have already attracted significant investment.
Ortig doesn’t view these start-ups as competitors but as allies. His goal is to challenge the dominance of US and Chinese companies in the field. However, he acknowledges that overcoming this challenge will require more than just a handful of companies. He strongly believes that possessing advanced technology provides geopolitical advantages.
Despite this, NXAI has no intentions of building a new ChatGPT. Ortig believes that the goal of research should be to enhance the basic technology, which can then be utilized by other companies in various applications, including existing language models.
The exact amount of investment that NXAI’s shareholders have made remains undisclosed. However, the rumored figures suggest a substantial sum in the millions, with market estimates ranging between 15 and 30 million euros.
Ortig reveals that in the next two to three months, they aim to prove the effectiveness of their technology. Following this, they plan to initiate the “next big stage,” which will require an investment in the hundreds of millions of euros. Ortig explains that establishing the infrastructure necessary to operate applications independently demands significant capital.
According to Clemens Wasner, Chairman of the think tank AI Austria, companies involved in AI models often collaborate with traditional industrial companies. He draws a parallel between building the necessary infrastructure and setting up a factory. However, he notes that acquiring funding on the required scale is particularly challenging in Europe.
Ortig acknowledges that catching up with the USA and China’s lead in AI will not be an overnight process. He estimates a three-year lag considering infrastructure and investments. However, he remains optimistic that NXAI can make up for this in the long run with their technological advancements and research.
Role model arm
Wasner sees potential for European AI companies, citing the example of chip designer Arm. Despite starting years after Intel, Arm managed to outshine its competitor by focusing on mobile devices and applications. Wasner believes that the key to success lies in identifying and excelling in a niche.
However, he concedes that it is generally more challenging for start-ups in Europe to establish themselves. He attributes this to the lack of investors willing to challenge the status quo, a trait more commonly found in the US.
In December, the EU introduced the AI Act, the first actual regulation for AI technology in the world. Wasner discusses the implications of this regulation on start-ups. While it provides legal certainty for existing companies, it imposes higher solution creation costs on underfunded start-ups. He argues that the EU regulation is addressing the wrong problem at the wrong time and suggests that the focus should be on investing in the emergence of a new generation of companies.