AI Adoption To Accelerate in 2025 Despite Midmarket Skepticism
While midmarket tech leaders have expressed concerns about the hype surrounding generative AI (GenAI)—with some questioning whether it is suitable for “serious workloads”—there are no signs that AI adoption will slow down in 2025.
On the contrary, research from Gartner highlights that GenAI offers tangible business benefits, including faster product development, enhanced customer experiences, and improved employee productivity.
AI Investment Remains Strong
Investors continue to show strong interest in AI startups. Recent studies reveal that AI-focused companies are outpacing other emerging businesses in securing funding.
According to a report from WriterBuddy.ai, the top 50 most-funded AI startups collectively raised $52.8 billion as of October 2024, reaching a total valuation of over $358 billion.
AI Infrastructure and Security Attract the Most Investment
The most heavily funded AI startups fall into three main categories:
- AI Infrastructure and Models – These startups received the largest share of funding, raising $35.5 billion in 2024.
- Data and Analytics – Companies focused on AI-driven data solutions secured significant investment.
- Defense and Security AI – Startups in this sector raised $3.8 billion, reflecting increased interest in AI applications for national security and cybersecurity.
The report’s data was compiled from multiple sources, including Crunchbase, PitchBook, and news articles, according to WriterBuddy.
7 AI Startups That Midmarket Leaders Should Watch in 2025
For midmarket IT leaders looking to leverage AI for competitive advantage, here are seven promising AI companies with strong business use cases. Funding data is sourced from Crunchbase and WriterBuddy.
1. OpenAI
- Total funding: $17.6 billion (as of Q4 2024)
- Valuation: $157 billion
Why midmarket leaders should watch OpenAI:
Despite concerns about large language models (LLMs) and intellectual property security, OpenAI has introduced an enterprise-grade AI service. This offering prioritizes corporate data privacy and security while incorporating advanced data analytics capabilities, making it a valuable tool for midmarket businesses.
2. Anthropic
- Total funding: $8.4 billion (as of October 2024)
- Valuation: $40 billion
Why midmarket leaders should watch Anthropic:
Anthropic continues to expand its AI platform with innovative features. Notably, the Claude 3.5 Sonnet model includes a “computer use” feature that enables AI to interact with digital environments. For instance, it can automate repetitive tasks such as filling out vendor request forms in spreadsheets.
3. Databricks
- Total funding: Nearly $4 billion
- Valuation: $43 billion
Why midmarket leaders should watch Databricks:
Databricks provides a GenAI-powered data intelligence and analytics platform. The company also offers executive training programs, helping business leaders understand how its AI-driven solutions enhance data governance, security, and cost-efficiency.
4. Scale AI
- Total funding: $1.6 billion (as of October 2024)
- Valuation: $13.8 billion
Why midmarket leaders should watch Scale AI:
Scale specializes in AI model training data and GenAI infrastructure, allowing companies to develop customized AI applications tailored to their specific needs.
5. Mistral AI
- Total funding: $1.04 billion (as of October 2024)
- Valuation: $6.2 billion
Why midmarket leaders should watch Mistral AI:
Founded by former Meta and Google engineers, this French AI startup provides automation and bespoke AI solutions for businesses. A key differentiator is that Mistral does not use customer data to train its public models, ensuring greater data privacy.
6. Cohere
- Total funding: Undisclosed
- Valuation: $5.5 billion (as of October 2024)
Why midmarket leaders should watch Cohere:
Cohere specializes in large language models (LLMs) and retrieval-augmented generation (RAG), offering powerful AI solutions for enterprises looking to enhance knowledge retrieval and customer interactions.
7. Perplexity AI
- Total funding: Undisclosed
- Valuation: $8 billion (as of Q4 2024)
Why midmarket leaders should watch Perplexity AI:
Perplexity is an AI-powered search engine, competing with traditional search platforms. In April 2024, it launched Perplexity Enterprise Pro, a business-focused AI search solution that offers SOC2-certified security and ensures that customer data is never used to train public LLMs.