The Transformation of Artificial Intelligence in the Financial Industry: An Opportunity for Developing Economies

Document Type : Policy Note

Author

Visiting Scholar at Stanford University, AIx2 Founder & CEO

Abstract

Artificial Intelligence can present a unique opportunity for developing economies, which often face capital shortages. On one hand, it can facilitate attracting investments, and on the other, it can increase investment returns. In the transformative landscape of venture capital, AI emerges not only as an investment opportunity but also as a transformative tool that redefines investment strategies and the operational efficiency of investment funds. Leading investment funds such as A16Z, Sequoia, and Capital Tiger leverage AI to not only improve their processes but also to discover hidden gems in the vast sea of investment opportunities. This novel approach to AI, using it to find investment opportunities for developing economies like Iran, presents an opportunity to attract foreign investment and invest in better positions. Therefore, macro-policies should be geared towards creating the necessary platforms for using AI to discover investment opportunities. This issue consists of four pillars: providing the necessary data, enabling data processing with AI to find suitable investment opportunities, upgrading the daily operations of funds, and providing effective signals to foreign investors to find a local partner. Additionally, the investor should provide the opportunity to use this technology for funds by defining appropriate rules for AI, including data privacy. The policymaker can actively participate in the formation of an investment database and the production of local software for fund operations to accelerate the use of AI for investment funds.

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References

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Journal of Science and Technology Policy
Volume 17, Issue 3 - Serial Number 63
AI
September 2024
Pages 67-75

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