ChatGPT’s launch in the final weeks of 2022 turned conversational language into the default interface between humans and AI. Since then, large language models (LLMs) and their multi-modal successors have become more capable, and inference costs have dropped by a factor of 10 or more each year. That combination of better models at lower cost is unlocking more ambitious and complex AI use cases all the time.

Much of the excitement over the past three years has centered on the model builders and young AI-native companies, who are attracting huge valuations as a result. OpenAI, the maker of ChatGPT, was valued at $500bn in October as current and former employees sold shares in a secondary offering. That deal came just a few weeks after Anthropic closed a funding round that valued the company behind the Claude chatbot at $183bn.

The startling growth of these American success stories has widened the technology gap between the U.S. and the rest of the world, with Europe and other regions falling behind. France’s Mistral, one of the region’s few producers of foundational AI models, is valued at just $14bn.

Artificial intelligence risks becoming a microcosm of a wider European malaise. While the U.S. created 241 companies from scratch with a public valuation of more than $10bn over the 50 years through 2024, the European Union produced just 14, according to data collected by Andrew McAfee, a researcher at the MIT Sloan School of Management.

The European opportunity

Yet the next wave of AI innovation might just favor product developers over model builders, giving Europe a chance to close the gap with the U.S. As Joel Hellermark, CEO of Sana, an EQT portfolio company that builds AI tools for knowledge workers, told the Financial Times in an October interview, Europe is unlikely to catch up with America’s lead in foundation models like ChatGPT but is more likely to succeed in AI applications.

With hundreds of portfolio companies across industries, geographies and maturities, EQT is seeing firsthand how AI is reshaping the global economy. That scale of knowledge gives us the vantage point to understand where AI is having the biggest impact, and where it’s creating new opportunities.

In this report, we have invited experts from across EQT to explore how we are approaching AI as investors, board members and company builders – where the upheaval will be felt most, how we help companies apply it, and what real deployment looks like.

Download the full report here.