3 Startups Building World Models, AI's Next Frontier

Three startups—Decart, AMI Labs, and World Labs—are pioneering the development of 'world models,' an advanced AI approach that understands the physical world beyond language models, driving the next phase of AI.

Mon Jun 01 2026

World Models: The Next Frontier of AI

While language models (LLMs) have dominated the AI industry with their focus on text prediction, a growing number of researchers believe that merely predicting the next word is insufficient to advance machine intelligence. World models are now emerging as a more advanced way to achieve intelligence through AI by understanding world interactions. Three startups—Decart, AMI Labs, and World Labs—are at the forefront of this development.

Differentiating World Models from LLMs

World models are multimodal, capable of understanding physics, spatial relationships, and the consequences of actions—areas where LLMs fall short. While LLMs improve through additional training data and computational power, they often face diminishing marginal gains. In contrast, world models continuously learn from their surroundings, adapting to new information and optimizing output, much like humans do. This capability is what differentiates world models from LLMs as AI moves towards Artificial General Intelligence (AGI), with applications spanning robotics, healthcare, self-driving cars, and gaming.

*Source: Techloy (2026-06-01)*

Tags: #ai #physical-ai #world-models #startups #tech