New Game, New Rules? Investor Ecosystem Effects on AI Startup Success

The rapid advancement of artificial intelligence (AI) has ushered in a surge of AI startups. AI startups have been hypothesized to be organized in and benefit from ecosystems, with concrete research to substantiate this claim remaining scarce. We aim to bridge this gap by providing a first step towards a scientific understanding of AI startup ecosystems, focusing on investor-related ecosystem effects. We employ a network theory approach to examine the relationship between investor-related ecosystems and AI startup success. We provide an overview of how investor-related ecosystems influence the success of AI startups and how investor types affect their success differently. Findings suggest that AI startups disproportionately benefit from investor-related ecosystem effects and that they differ by investor type, suggesting a new pecking order for choosing investors. In light of these results, practitioners and scholars are prompted to reassess established norms of entrepreneurial finance and startup success factors concerning AI startups.