Stephen Pierre on board

Sepp Hochreiter, an artificial intelligence (AI) pioneer from the University of Linz, wants to create a new center for AI research and product development in Europe with Netural X and Stefan Pierer's Pierer Digital Holding in the Upper Austrian capital. For this purpose, NXAI GmbH was established with companies in December 2023. For the researcher, investment by private companies in basic research is unique in Europe.

Last year, Hochreiter, head of the Laboratory for Artificial Intelligence at the Linz Institute of Technology (LIT) and head of the University of Machine Learning, criticized Austria's lack of a sensible AI strategy. “I'm sitting here in Linz on something brilliant, but I don't have the money to do it,” he said in an interview with APA.

Sep Hochreiter in an interview

Born in Bavaria, he developed one of the foundations for AI systems in 1991 with long-short-term memory technology (LSTM). By creating this, you can quickly create a “best ChatGPT” that you can use. Current large language models (LLM), based on transformer models, require very high computing power during processing if the text is long. As the length of the text increases, the transformer calculations increase quadratically. With xLSTM, now further developed by Hochreiter, computations scale only linearly with the length of the text. This means “we can provide the same service, but because you need fewer computers, you pay less for it,” he says.

The focus of NXAI GmbH, which is located in the Linz tobacco factory and currently has ten employees, is therefore on the further development of the European large language model technology xLSTM, which is the basic technology for all industries. Albert Ortig, CEO of Netural X and NXAI, said that over the next three months, the research will be compared with products available on the market. “At the same time, we are working on diversifying products and making them commercial and industrial.” According to Wirtschaftskompass, NXAI GmbH owns 37 percent each of Pierer Digital Holding and Netural.

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Initially purely privately funded

A research collaboration between Johannes Kepler University (JKU) and NXAI has been agreed to go one step further with basic research already carried out at the university under Hochreiter, Rector Stefan Koch said. In other words, “implement these on large computing resources and then create products from them in order to turn university knowledge into an economy”.

How much money is available is not specified. “We haven't communicated the amounts, but we're willing enough to do what we need to do,” Artic said. It is completely privately funded with no sponsorship at the moment, which the CEO expects later on.

Only Hogwriter from Silicon Valley knows that private investors are investing in basic research to keep the technology in-house. In general, disbursement of funds in Austria and Europe is very slow, often taking weeks or days, he noted. “By the time financial apps go here, you're “overwhelmed by the competition,” he finds bugs in the system: financing tools in Austria are “super ill-suited” for fast-moving AI.

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