#How Does the PitchBook GenAI 20 Index Track Generative AI Companies?
The PitchBook GenAI 20 Index is designed to provide a comprehensive view of leading generative AI companies by tracking their performance across both private and public markets. This innovative index includes top firms such as Databricks, Anthropic, OpenAI, and xAI, weighted by their exposure within the portfolio.
The structure of this index leverages PitchBook’s extensive private market data to maintain continuous coverage. With this data, it captures late-stage venture-backed companies in the generative AI space, which often fall outside the parameters of traditional investment benchmarks.
#What Are the Key Components of the Index?
The index starts with Databricks, commanding a significant weight of 21.4%. Following closely are Anthropic at 19%, OpenAI at 18.9%, and xAI at 18.6%. Collectively, these four companies represent nearly 78% of the index's total allocation. Additional holdings within the index include Safe Superintelligence, Anysphere, Mistral AI, and Cohere, which further diversify its offerings.
#Why is This Index Important for Investors?
This benchmark is particularly noteworthy as it focuses on purely generative AI firms that are often excluded from traditional indexes due to being privately held. Its unique structure ensures ongoing tracking continuity as these companies transition from private funding to becoming publicly listed entities. This evolution is crucial for investors seeking to capitalize on the growth potential of this dynamic sector.
#What Insights Can Investors Gain?
Understanding this index helps investors identify opportunities in one of the most significant growth areas expected to shape various industries over the next decade. Generative AI is not just a trend; it is profoundly transforming the landscape of software development and scalability. Investors can gain clarity on how to navigate both public and private markets within this high-growth theme, enhancing their investment strategy.
In addition, Morningstar is committed to broadening its suite of investor tools which focus on the convergence of public and private markets. This includes expanded coverage of private companies and analytics powered by PitchBook that will aid investors in making informed decisions.