The industry is also benefiting from a cycle of investment where companies are acquired, scaled up and go on to invest in other start-ups.
Zoe Chambers, head of future industry at Octopus Ventures, referred to this as a "pay it forward mentality." However, she told CNBC that while a lot of capital was flowing into the market, it was still difficult to make deals with the most innovative companies.
"An increasing number of American investors are looking across to the U.K. and Europe," she said, noting Google's £400 million acquisition of DeepMind in 2014. "The biggest tech companies in the world are all making huge investments in AI, so it would be foolish of us not to take notice of that."
Her advice to potential investors was to have realistic expectations.
"A lot of breakthroughs have largely plateaued," she said. "But there is a lot of opportunity to harness that. For me that means tech that could speed up scientific research, or at least predict a hypothesis quicker. So don't expect that the technology is going to be massively disruptive, but look for tech that's going to be applied to something that's calling out for it."
One company capitalizing on this is Luminance, a three-year-old start-up providing AI that eases the workload for law firms. CEO Emily Foges said the technology was continuing to grow as it is being developed to apply to various areas of law.
"Luminance works with compliance, property law, litigation – we will go on because there are so many different fields of law where this tech makes a difference," she told CNBC on the phone. "What's paying right now is that everyone understands you cannot make the margins you need to compete without this technology."