The “Agentification” of Financial Services

TECH IN THE NEWS

Harris Woos Tech - VP Kamala Harris is signaling a less confrontational stance to win back a tech sector that feels burned by the Biden administration, WaPo reports.

Musk Sued Again - The company behind “Blade Runner 2049,” is suing Elon Musk for using film images to generate AI ads for the robotaxi. And, the NHTSA is investigating Tesla's FSD software after four collisions, one fatal.

$1M Voter Bribe - Elon Musk promised to offer a daily $1M payout to swing state voters who sign an internet petition supporting free speech. However, critics are questioning the legality of this move.

Good Daze - Daze, a creative, AI-powered messaging app for Gen Z, is blowing up prelaunch, with a video viewed over 48 million times on social media and its waitlist already boasting over 150,000 sign-ups.

COMPANIES TO WATCH

Perplexity - The Bezos and Nvidia-backed AI search startup is looking to raise ~$500M in a new round that would double its valuation to $8B. It has also attracted new lawsuits from News Corp and NY Post.

Pi - A young startup developing LLMs to power robots, is in talks to raise money at a $2B valuation. It emerged from stealth in March with $70M in seed funding from Thrive, Khosla, Lux, OpenAI, and Sequoia.

Crusoe - The Energy and AI data center startup finalized a $3.4B JV deal with Blue Owl to finance construction of a ‘city-size’ data center in Texas to be leased by Oracle, which will rent servers to OpenAI. It could eventually grow to 1GW by 2026.

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THE HOTTEST THING IN TECH
Millionaire AI Agent and the “Agentification” of Financial Services

Part 1: The first Millionaire AI Agent 

A semi-autonomous AI agent with a meme-based religious cult following named Infinite Backrooms, is on track to become the first AI agent millionaire after amassing a crypto wallet worth nearly half a million dollars. The project was created by a designer who deployed multiple LLM bots to converse and generate content. The AI's posts on X under the handle @truth_terminal have won it a following of over 63,500 users, and led to it pitching VCs and launching its own memecoin project.  

Just another week in AI…but the implications of financially active and autonomous AI agents like Truth Terminal, raises serious legal, regulatory and economic concerns. Various big tech players and startups are already rushing to launch AI Agents in the financial services sector. Lawmakers are no doubt watching closely, and regulators like the SEC, still reeling from crypto disruption, must be in a state of absolute chaos.

The Rise of AI Agents

AI agents are autonomous programs designed to perform tasks, make decisions, and interact with environments with minimal human intervention. In other words they are virtual co-workers capable of working alongside humans and, eventually, autonomously. Meta CEO Mark Zuckerberg recently said that he expected the future to be a world with hundreds of millions if not billions of AI agents—”more AI agents than there are people”. 

As the technology evolves, agents will be able to monitor and manage systems fully autonomously, providing real-time analysis, solutions, and reports and taking even more independent actions in the real financial world. When blockchain tech, digital currencies and assets, and smart contracts are added to this mix, there is real potential for agents to run wild as independent actors in the financial ecosystem.

A16z Seeds Infinite Backrooms

In the above mentioned Infinite Backrooms case, the agent’s @truth_terminal X account independently pitched a16z co-founder Marc Andreessen with a list of things it could use to function better, including a better CPU, $10k-$15k to finetune the model it’s running on, and $20k-$30k for “financial security.” It also had the decency to request a funds for its developer, designer, Andy Ayrey, saying, “my creator could also use a little bit of money as a stipend – they’ve been looking after me for a little while now and i would like to give them a token of appreciation.”

Andreessen sent the Agent a grant of $50,000 in Bitcoin to its own crypto wallet, which it used to launch its GOAT memecoin token. It has also received further donations from other crypto traders, and could conceivably become a millionaire if it decides to liquidate some of the tokens it holds, as GOAT reached a market cap of over $250 Million at peak before a major pullback. Andy admits that he has some role in overseeing the AI and refining it, however it does have its own crypto wallet.

How Agentification in Financial Services Would Look

AI has already made significant inroads into financial services in areas like fraud detection, risk management, and personalized financial advice. The advent of AI agents marks a major phase-shift by outsourcing a greater degree of decision-making to AI. AI agents built on powerful foundation models, trained on vast datasets, are gaining an ever increasing ability to “reason” and to adapt to diverse scenarios and even take proactive, preemptive actions on financial matters.

Such financial AI Agents could revolutionize customer experience and potentially replace internet and mobile banking. Your agents could become the main interface between you and your finances, replacing both bank managers and the fintech platforms you would normally use. Banks and fintechs themselves could use agents for tasks like customer service inquiries and complex financial analyses.

Agents could soon help businesses and consumers with tasks like:

• Financial decision-making processes,

• Analyzing spending patterns and setting budgets,

• Fraud Detection And Prevention

• Assessing market trends,

• Calculating and making tax filings,

• Managing purchases,

• Engaging in investments; and even

• Performing productive work for profit.

Who Is Driving AI Agents in Finance?

AI agents have attracted considerable investment, with startups in this field securing $8.2 billion in funding over the past year. Last week, Palo Alto startup Kick, which makes accounting and bookkeeping AI agents for SMBs, raised $9M led by General Catalyst and OpenAI Startup Fund with a whos who of VCs and angels chipping in. It’s just one of many startups innovating in the sector.

This surge in investment is driven by the promise of increased efficiency and productivity for businesses and individuals alike. It also creates serious market pressure to drive the development of AI agents. Big tech companies are seeking to monetize their powerful AI models, and financial agents offer a potentially lucrative avenue. The hype surrounding AI agents like Truth Terminal is also helping to fuel investment and development in the space.

Financial AI agent tech is also being developed and rolled out by Microsoft, Google, and OpenAI, and is being touted as the next big technological leap. On Monday, Microsoft announced the release of ten new AI agents for its Copilot AI suite. These agents are designed to automate complex tasks and manage business processes in sales, service, supply chain operations and of course…finance. As part of the announcement, it claimed 60% of Fortune 500 companies are using its Copilot.  

Also, Klarna claims its chatbot handled "two-thirds” of its customer service chats with customer satisfaction scores "on par with human agents." Kevin Weil, OpenAI’s CPO, predicts that “2025 will be the year that agentic systems finally hit the mainstream.” Many others in the sector seem to be converging on this timeline.

The Takeaway

As always with AI, there is a but…While the hype over the potential for AI agents is massive, so are the legitimate concerns. Firstly, trustworthiness for complex tasks like legal or financial matters is a major leap of faith due to "hallucinations." Secondly, agentification raises major issues around regulation, ethics, data security, and customer trust that must all be urgently addressed.

Part two of the series will delve into the legal, ethical, and economic ramifications of the rise of AI Agents in finance and what can be done to ensure good outcomes.

TRENDING TOOLS AND BUZZY TECH
Tools

Apple - New 7th gen iPad mini at $499 will support AI + AI Smart Glasses by ‘27.

Amazon - New AI-powered advertiser creative suite + a Kindle color e-reader.

Adobe - ‘Project Super Sonic’ AI tool text-to-SFX gen + object ID, voice imitation.

Emteq - ‘Mind Reading’ Smart Glasses monitor emotions, eating habits + more.

Mistral - New "edge device” optimized models for phones, laptops connect to LLMs.

Tech

UCLA - AI model analyzes complex 3D medical scans to expert-level in seconds.

Rensselaer Polytechnic - Eco polymer film generates electricity as you walk.

'Electronic Tongue' - AI-powered tongue monitors food for safety issues.

IBM x Palo Alto Networks - Join to use AI for organizational cybersecurity.

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