Key facts
- Singapore's GIC is expanding its investment strategy to include companies that can leverage AI for value creation.
- The sovereign wealth fund is also integrating AI into its internal operations, such as deal review processes.
- GIC categorizes AI investments into enablers, monetisers, and adopters.
- The fund has invested in companies like Equinix, Atlan, Databricks, and Ramp.
- GIC anticipates rapid value creation and destruction globally due to AI over the next decade.
Singapore's sovereign wealth fund, GIC, is broadening its investment strategy to encompass companies that can effectively leverage artificial intelligence to enhance their corporate value, moving beyond a sole focus on AI developers and semiconductor firms. GIC CEO Lim Chow Kiat stated that AI presents "unparalleled" opportunities for both investments and operations, and the fund is committed to integrating the technology at the core of its business.
GIC is actively trialing AI within its own operations, including a virtual investment committee member in its fixed income and multi-asset department. This AI agent reviews deal terms and information, posing questions based on both internal data and public information. The fund has reported positive feedback since its deployment a year ago and is developing additional personas for the agent to foster more robust discussions.
The sovereign wealth fund's AI journey began in 2023 with the establishment of its AI Council, initially concentrating on foundational elements like data, tools, and governance. Now, GIC aims to accelerate AI adoption while maintaining strong governance. Bryan Yeo, GIC's Group Chief Investment Officer, explained that the fund applies a granular approach across the AI value chain, categorizing companies into enablers, monetisers, and adopters. GIC has significantly invested in enablers over the past five to ten years and is now looking at companies integrating AI to improve processes and productivity.
Key characteristics GIC seeks in companies include durable moats, differentiated technology and teams, and sound business models. Investments have been made in firms such as digital infrastructure provider Equinix, data and AI governance platform Atlan, data and AI company Databricks, and financial operations platform Ramp. GIC also utilizes its long-term capital and global network to support the growth of AI capabilities and adoption worldwide, connecting tech startups with multinational corporations in its portfolio. Yeo cautioned that AI is expected to drive high velocity of value creation and destruction globally in the next five to 10 years, and GIC is prepared to divest companies that fail to adapt.