AI's coming of age The progress into the AGI phase and
the beginning of true autonomy.

AI's coming of age - The progress into the AGI phase and the beginning of true autonomy.

The beginning of true autonomy

In the next four years, we expect AI’s industry growth will start to explode and its impact on business and society will begin to emerge.

By the end of the decade, we believe the recent rapid advances in AI will eventually plant progress firmly into the AGI phase – the beginning of true autonomy. AI-powered machines and software will likely start to untether from human supervision, embarking on their fateful path as sentient beings. But this will happen much later in the distant future. In the next four years, however, we believe AI's industry growth will start to explode and its impact on businesses and society will begin to emerge.

According to our estimates, the AI industry was a USD 5 billion marketplace by revenue in 2015, , a respectable size for such a budding sector. By 2020, we believe exponential improvements and broader adoption should more than double revenue to become a USD 12.5 billion industry. This represents a 20% annual growth rate. Assuming enterprise value/sales multiples of 10-15x, which is on par with other emerging fast-growing industries within the tech sector, AI as a standalone industry has the potential to claim a total market cap of USD 120-180 billion by 2020.

AI software will create significant business opportunities and societal value.

Software companies will take up the mantle and charge ahead, pushing the boundaries of automation, search and social media. Dubbed a machine's brain, AI will likely power automation in sectors like autonomous vehicles and unmanned drones. And AI software will create significant business opportunities and societal value.

For example, virtual assistants or chatbots will offer expert assistance; smart robots or robot advisors in the fields on finance, insurance, legal, media and journalism will provide instantaneous research or findings; and within the healthcare field, AI software will assist with medical diagnosis and assistance. Other benefits include significantly improving efficiencies in R&D projects by reducing time to market, optimizing transport and supply chain networks, and improving governance by better decision-making processes.

Already today, there are expert systems that can scan and share overviews of legal documents from obscure previous court rulings with lawyers within seconds, saving time and money. Autonomous driving, though still in the early stages, has also made tremendous progress; self-driving taxis were just recently launched in Singapore. And the list goes on, thus proving the inevitable ascendance of AI into our everyday lives.

Are we at risk of being replaced?

Technological unemployment is unfortunately a byproduct of progress.

Mechanized looms reduced artisan weavers to poverty, the tractor forced millions out of jobs and robotics has sliced countless workers in all types of manufacturing. The increasing integration of AI will ultimately yield greater productivity in the near term, the result of which has historically led to culls in employment.

The concerns are legitimate, but during this period AI will not nearly be at such a developmental stage that its widespread adoption will trigger mass layoffs. The technology will still be used in relatively niche applications and will not yet achieve a level of critical mass that would threaten employment on a global scale.

In most areas, AI is poised to replace tasks, not jobs.

However, global employment will not escape unscathed. By automating tasks that rely on analyses, subtle judgments and problem solving, AI can be a threat to low-skill, predictable and routine jobs in industries like retail and financial services and indirectly through the broader automation of the auto industry and certain other manufacturing industries. While it is difficult to project the exact impact at this stage, assuming 5% of the jobs in these industries are routine in nature, we expect 50-75 million jobs globally, or 2% of the worldwide work force, will be potentially affected due to the advent of AI – a significant number, but one that pales in comparison to the opportunities AI will create.

AI's rise and ensuing surge in productivity will spur a plethora of opportunities for employees to upgrade their skills and focus on creative aspects. With the emergence of other disruptive business models like apps or sharing economies highly likely in a post-AI era, there is increased scope for jobs that require a high level of personalization, creativity or craftsmanship - tasks that will still need a person. These occupations are hard to imagine at this point, hence the job-related anxiety associated with AI's widespread integration; but they will quickly proliferate as new specializations are needed - comparable to the post-Industrial revolution bloom of factory workers.

What will be the impact on employment?


Jobs worldwide that will be affected due to the advent of AI


The winners and losers of AI's rise

AI will not only reduce costs by automating processes but also maximize revenues by helping corporates introduce new product and service categories.

Given the limited size of the current market, we believe direct beneficiaries in this stage will be software companies and robotic process automation industries with a first-mover advantage. In the medium term, the AI industry will eventually consolidate given the outsized number of startups focused on AI. But as industry standards emerge, there will only be a few potential winners.

There will also be indirect beneficiaries, such as healthcare, hi-tech engineering and select services companies, due to improved efficiencies in research and development. For example, with deep learning and predictive analytics tools, AI can significantly reduce the costs and time of drug development in the pharmaceutical industry by predicting the therapeutic use of new drugs, thus driving huge efficiency gains.

Conversely, where there are winners, there are also losers. Without adapting to the changing landscape and adopting AI into current business models, industries like retail and automotive will be most at risk of falling behind. As mentioned earlier, AI's rise will have a more profound effect on certain industries, the companies of which will likely live or die based on their ability to cope with rapid technological changes.

In the next chapter, we go into more detail about AI's impact on these sectors.


  • Software companies
  • Robotic process automation industries
  • Healthcare
  • Hi-tech engineering
  • Select service companies


  • Retail that won’t adopt Artificial Intelligence
  • Automotive that won’t adopt Artificial Intelligence

Where do we see investment opportunities?

Industry 4.0's global revolution levels the playing field

The fourth industrial revolution is unique in that the technology powering new industry has been completely democratized.

Entrepreneurs only need an idea and knowhow to develop the next Uber - and the global nature of venture capital. Thus, this era will not be a Western-dominated revolution, in our view, but a global phenomenon with contributions from all over the world.

The US and Silicon Valley will of course do a lot of the heavy lifting, but startups and tech giants in China, Singapore, Japan, South Korea, Taiwan and India have already made remarkable inroads in various technology segments and are increasingly pushing the envelope as the benefits of being part of this journey become clearer with each innovation.

In the coming years, these "new world" emerging markets will increase not just their share of invention, but their importance as a consumer. And as a matter of national pride and significance, their governments will support their native technology industries and start-up communities with both resources and talent. And in part, thanks to AI specifically, companies operating in emerging markets will be able to compete with those in the developed world, effectively leveling the playing field for the first industrial revolution in history.

AI's evolution is currently being steered by the exponential growth in computing power and the solid cloud and smart device ecosystem in place. Favorable supply factors, like low computing and storage costs, advanced algorithms and the increased availability of AI-based talent, are also helping to nurture the necessary conditions for progress.

But it will be through global collaboration that we will usher in the next phase of AI's evolution - the transition from AGI to ASI. And with it, everything will change.


  • An impressive 20% annual growth is anticipated in the short-term future.
  • The software industry is expected to take the reins in leading innovation.
  • The employment landscape will be fluid with jobs lost and gained.
  • There will be indirect beneficiaries, such as healthcare, hi-tech engineering and select services companies.
  • This will not be a western revolution: it is a global one.

AI will surpass human intelligence

How will the world look like with AI as a central part of our lives?