AI fintech products are operating at scale and investor interest is maturing

Recently public unicorn Upstart announced earnings that blew the socks off of Wall Street this week. After closing on Wednesday at around $61 per share, Upstart wrapped Thursday worth $115 per share. It turns out that all the blather we’ve had to endure about artificial intelligence (AI) in the past decade is coming true, at least in certain applications for select companies.

But Upstart’s blockbuster guidance for 2021 is just a sliver of the story. The AI-powered fintech is projecting a year so good that its valuation nearly doubled yesterday, but there are other shoots of life in the AI world worth discussing, and investors are taking note.

Per a new data set I spent this morning chewing on, VCs are firing cannons of capital into the AI startup world while exits reach new records.

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Real-world financial output coupled to historically strong venture capital activity — and new technologies dripping into the tech upstart world at a record clip — are creating whole cloth new use cases for AI tied to lots of capital access. It’s all very exciting.

This morning, I want to discuss Upstart and its quarterly results. I spoke with CEO Dave Girouard yesterday, which yielded some notes on AI-powered tech adoption rates among more conservative companies. Then, we’ll peek into PitchBook data on global AI-focused startup fundraising and their exit market.

After that, we’ll start to come up with a list of GPT-3 powered startups, my new favorite thing aside from pastries. Sure, we’re not as laser focused today as we are most mornings, but the AI world has me jazzed, so I can’t help but talk about it. Let’s go!

Upstart expects 114% YOY growth in 2021

In its first earnings report as a public company — you can read The Exchange’s coverage of its IPO here and here — Upstart reported Q4 2020 revenues $86.7 million (up 39% on a year-over-year basis), while its 2020 revenues totaled $233.4 million (up 42% on a year-over-year basis).

The quarter was a strong revenue beat, and a beat on adjusted profits. But it’s what the company has coming next that really stuck out. Here’s its CFO: