Harnessing AI for Real-World Solutions: The Vision of Preferred Networks
In the world of artificial intelligence, some names shine brightly on the global stage, while others remain relatively obscure yet are making monumental strides behind the scenes. One such hidden gem is Preferred Networks, a Tokyo-based startup backed by automotive titan Toyota. While it might not yet be a household name outside Japan, its ambitious plans could reshape industries ranging from trucking to health care.
Who is Preferred Networks?
Founded by Toru Nishikawa and Daisuke Okanohara, Preferred Networks is not just another tech company; it is a pioneer in the field of deep learning. The startup’s mission is to leverage AI to tackle real-world challenges, an endeavor that has led to innovations across various sectors. As Okanohara elaborates, “For the past 10 years, we have been working on using AI to solve real-world problems.” This commitment to meaningful innovation is essential in a time when AI is often criticized for being overhyped and underdelivering.
The Backing of Industry Giants
One of the key advantages of Preferred Networks is its backing from Toyota, which invested a significant 10.5 billion yen (roughly $95.4 million) in 2017, building on an earlier investment of 1 billion yen in 2015. This support not only gives the startup financial stability but also access to a vast network of expertise and resources in the automotive sector.
Japan may be home to just 0.5% of the world’s unicorns, as highlighted by a recent International Monetary Fund study, but Preferred Networks stands out among them. Its rapid evolution and ongoing projects signal a potential shift in the landscape of Japanese startups, where traditional business practices are increasingly supplemented by innovative tech-driven solutions.
Tackling Automation in Trucking
The company’s journey into the autonomous driving market is particularly noteworthy. In collaboration with Mitsui & Co., Preferred Networks has invested in a venture named T2. This partnership aims to address pressing issues in the trucking industry, ranging from the severe labor shortage faced due to long working hours to the urgent need for automation in logistics.
Yet, Okanohara acknowledges challenges. The race in autonomous vehicles is fierce, with many companies vying for dominance. He states, “If we were to tackle the problem of regular cars, it would be extremely difficult,” signaling an awareness of the competitive landscape that innovation must navigate.
Real-World Challenges Demand Patience
Preferred Networks isn’t taking shortcuts. According to Nishikawa, bringing AI solutions to the market can take three to five years, especially in complex fields like AI-based material discovery. The journey begins with joint research collaborations, after which the viability of the solution is assessed for commercialization. This strategic approach highlights a dedication to thoroughness and quality over haste, which is often lost in the race for innovation.
Entering the Semiconductor Space
In keeping with its mission to push boundaries, Preferred Networks is also looking to enter the semiconductor space. Currently, it is observing advancements in chip technology closely, eyeing the innovative strides made by firms like Nvidia. While Nishikawa notes that Nvidia’s strategies are fruitful, he also emphasizes that there’s room for improvement in their graphics processing unit designs. This realization drives Preferred Networks to create "more advanced processors," aiming for a competitive edge that could fuel their AI ambitions even further.
Looking to the Future: IPO and Global Expansion
As Preferred Networks prepares to scale up, the company is eyeing opportunities in the global market. Nishikawa acknowledges the limitations inherent in a solely domestic focus, stating, “There are limits to what we can do in Japan alone, and the global market is much bigger.”
Looking toward the future, an initial public offering (IPO) is on the horizon. Okanohara details that the introduction of their hardware products, particularly in semiconductors, will necessitate significant funding—highlighting a strategic growth trajectory that includes a focus on fundraising and investor relations in the coming years.
Conclusion
Preferred Networks is more than just another player in the AI landscape; it represents the potential of Japanese innovation to have a global impact. As the company delves deeper into sectors like trucking, health care, and semiconductors, it is paving the way for a future where AI meaningfully contributes to solving some of the world’s most pressing challenges. For those interested in the intersection of AI and real-world solutions, the journey of Preferred Networks is one to watch closely. At Extreme Investor Network, we strive to keep you informed on the advancements and strategies that shape industries—and companies like Preferred Networks are certainly part of that narrative. Stay tuned for more insights as we explore the latest breakthroughs and ambitions driving innovation forward.