Bard vs. GPT-4

Last week, Google debuted its latest challenge to OpenAI: the new Bard. The waitlist is gone and Bard has some great new features. But can it beat GPT-4?

Today, I put both bots to the test.


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Bard now integrates with search and maps and can access the internet. So I tested it against its closest GPT-4 equivalent: Bing Chat.

Bing Chat uses GPT-4 and has internet access. It’s integrated into a search engine, just like Bard.

And unlike ChatGPT Plus, it’s free! (You have to use Microsoft Edge, but it’s a pretty good browser.)

I posed identical questions to each bot. These are real questions I actually need the answer to.

Let’s see how they do!

One of the main things I use GPT-4 for is help finding blog ideas. Again this morning, it performed well:

The stories are interesting and relevant. The links don’t work, but hey, it’s new technology right?

Now, let’s try Bard:

Bard refused my request entirely, outputting nothing.

GPT-4 has saved me hours in research time. But for this application, Bard seems useless.

I’m attending a demo day for Australian startups tomorrow. Maybe my new friends can help me prepare?

GPT-4’s answer was outstanding!

It told me things about Australia I never knew. I had no idea the culture was conservative.

It also gave me some ideas for questions.

Perhaps I should ask the startups about their international expansion plans. I rarely ask an American startup that since our domestic market is already vast.

Next, Bard’s turn:

Bard’s answer was good, but less complete than GPT-4’s.

It homed in on the risk of Australia’s small market. But it didn’t take the next logical step like GPT-4 and tell me to find out what a startup’s international expansion plan is.

Time for our third and final question.

I’m doing some research on the US meatpacking industry (long story). So I wondered, how many meatpackers are there in America?

Let’s ask GPT-4:

Excellent answer! It found an exact number and provided a source.

But it also called out something beyond the numbers. This is an unusual industry, with huge concentration.

GPT-4 made sure I’m aware of that. Nice work, GPT!

Let’s give Bard a shot:

Bard’s answer doesn’t seem accurate.

It gave a number only half the size of GPT-4’s. Maybe it’s valid, but without a citation, I’ll never know!

It did correctly call out the weird feature of meatpacking — massive concentration.

So far, Bard looks like a bust.

However, I’m sure Google will keep working on it. In time, it may catch up with GPT-4.

But for now, Microsoft and OpenAI have a heck of a headstart.

Have you tried Bard? If so, what did you think?

Leave a comment and let us know!

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Inflection: Better than ChatGPT?

ChatGPT is incredible. But this might be even better.

Reid Hoffman’s new startup Inflection AI released an incredible tool last week. It’s great at answering your questions. But uniquely, it also asks you questions!

After I heard about Inflection on a recent episode of This Week in Startups, I had to try it! It’s very easy — you can chat with the bot, Pi, on WhatsApp.

Calling it a bot almost feels disrespectful. This feels like a person.

I started out by saying hello and asking Pi how to use its skills.

Pi offered a great explanation of its abilities.

We were chatting on Wednesday night. I was going to be on a panel on venture capital the next day.

So I thought to myself, “Maybe Pi can help me prepare!”

My new friend did not disappoint:

The advice to be confident was helpful.

I tend to qualify things by saying “I think” or “I could be wrong.” But that’s obvious!

If I’m saying something, I think it. And anyone can be wrong.

And that’s when my chat with Pi really got interesting.

Pi started asking me questions!

Pi asked what kind of panel I was going to be on. I explained that it was about investing in startups.

We wound up in a nuanced discussion about how to invest.

Pi liked my approach of investing at Seed but only with traction. But it brought up some potential issues.

Going for the IPO is great, but those are rare. I may be undervaluing acquisitions as an exit strategy.

Then we really got into the weeds…

Pi asked me if I think SAFE’s are overused. I mentioned they have some pitfalls.

I couldn’t recall all the details. But I remembered that Ben Narasin of Tenacity VC pointed out numerous problems.

Pi knew all about it! It (he? she?) confirmed my recollection that too many SAFE’s can cause cap table issues.

Pi gives amazing answers to your questions. But I think the killer feature is Pi asking me questions to help me learn.

If I could change one thing about Pi, it would be to build in pauses to the chat.

The interaction was so immersive that the time flew by. There were no cues for a break or even a change of topic.

That makes me a bit hesitant to use it again. It might be too powerful.

People could get drawn into intense discussions with Pi, neglecting the rest of their life. Inflection should build safeguards around that.

But this is a very new tool. I’m confident Hoffman and his team will finetune it soon.

Congrats to the amazing team at Inflection AI!

Will you be trying Pi? Why or why not?

Leave a comment and let us know!

Have a great weekend everyone!

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Woz Calls for AI Regulation

Last year, someone called my grandma pretending to be me. I was in trouble and needed money.

It was a scam. What happens when that scam uses AI?


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“AI is so intelligent it’s open to the bad players, the ones that want to trick you about who they are.”

Steve Wozniak

Apple co-founder Steve Wozniak called out serious concerns with AI in an interview this week:

Speaking to the BBC, he said AI content should be clearly labelled, and regulation was needed for the sector.

“A human really has to take the responsibility for what is generated by AI.”

Back to my grandma. In the near future, the voice on the other end of that phone could sound exactly like me.

An AI model could clone my voice and speech style. Given my podcast appearances and this blog, it has plenty of data to work with.

Then, it could deliver an incredible story to grandma. And she might part with the money she worked a lifetime to save.

I pray this does not happen. But it is a serious risk.

AI impersonation involves way more than scams, however. Already, we have seen false images of Donald Trump in handcuffs.

I don’t think many people were fooled by those. But in time, fake images and video will only become more convincing.

We may soon be living in a hall of mirrors, unsure what reality is.

So I wholeheartedly support Woz’s call for labeling. And the best way to do it would be through self-regulation.

Angel investor Jason Calacanis laid out a great template on a recent episode of This Week in Startups. Tech companies could band together like the movie industry did with the MPAA.

Just like the MPAA required ratings labels for movies, tech could require certain labels for AI content. Companies that violate this could be banned from partnerships or financing.

Industries self-regulate to head off regulation by the government. And in a complex and rapidly changing field like AI, government is ill-suited to the job.

How many people in government know anything about AI? And even if they do, government moves too slowly to regulate something this dynamic.

AI has incredible benefits. I found out about Woz’s interview using GPT-4!

But anything this powerful also has serious risks. If we don’t start protecting people, the government will.

Do you agree with Woz? Why or why not?

Leave a comment and let us know!

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Money You Can Afford to Lose

Last night, I got a call from my old friend Matt. Matt had a problem. He had saved some money, but was terrified to invest it.

“What if I lose it?” he asked? So I explained to him the core concept behind all of my investments.


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The Money You Can Afford to Lose

In this great country, many of us are fortunate enough to have money we can afford to lose. We wouldn’t enjoy losing it, but life would go on.

That’s money we can use for riskier investments.

Why do we do this? Because greater risk often comes with greater rewards.

Francis the Speculator

Every day, I make some of the riskiest investments on earth. At night, I sleep like the dead.

A tech startup might be the most speculative investment you can make. At this early stage, a company is just a couple of people on laptops.

Assets? Nothing.

Collateral? Lol.

I expect 70% of my startups to go bust. The failure rate is higher than almost anything, except maybe crypto.

“Is that nerve-wracking?” people often ask.

Not at all. Because I know how much money I can afford to lose.

And I never bet more than that.

Startups are at the extreme end of the risk spectrum. An S&P 500 index fund is closer to the middle, and a better choice for Matt.

Money You Can’t Afford to Lose

We all need something to pay the bills, right?

That’s the money we can’t afford to lose. So we shouldn’t expose it to too much risk.

A good home for that money is a bank account or money market. You can make a little interest without worrying you’ll lose money.

Losses, Guaranteed!

Back to my buddy Matt.

“I’ll remove the mystery. You will absolutely lose money in stocks. I guarantee it,” I told him.

If you invest in any risky category long enough, you’ll take losses.

Thing is though, it tends to come back. And as humans innovate, prices reach ever higher.

Non-Attachment

I had one last thing for Matt.

It’s the concept of “non-attachment.” Called danshari in Japanese, it comes from Buddhism.

I try not to be attached to money.

I have certain assets now. But I might not always.

That money isn’t me. I’m me.

When I was younger, I didn’t have a dime. And I was still me.

So if I increase my assets, that’s great. But if they go away, I’ll still be Francis and I’ll be okay.

If we adopt a healthy attitude toward money, we become better investors.

We take a good bet when it’s available. And we don’t obsess about the potential for loss.

But something more important happens too. We become happier people.

How do you think about money? Leave a comment and let us know!

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Steak and Potatoes at Their Best at The Capital Grille

The juicy, crisply seared steaks hit the table. This is the good life.


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Ralphie May immortalized The Capital Grille in comedy. And as the staff covered our table in meat and scrumptious sides, I grinned from ear to ear.

“The potato don’t come with it?”

Ralphie May

We began with bread and butter, my favorite way to judge a restaurant. At the best tables, they’re never an afterthought.

The basket was stuffed with three kinds of bread. My favorite was a dark loaf with raisins — wonderful with a thick pat of butter.

Next, I heaped my plate with crispy green lettuce in a light vinaigrette. What is it about fresh lettuce that goes so well with a steak?

It was time for the most exciting moment in life: when they bring your entree.

I watched the staff set plate after plate in front of my friends. I stared at the waiter, slackjawed and doglike, awaiting mine.

This is when seconds feel like hours.

It’s here! A beautifully seared filet, oozing juices.

Does heaven smell like this?

I gingerly cut into it, almost afraid to damage this masterpiece. The inside was a beautiful red — a perfect medium rare.

The steak was tender. I could taste the fire of the grill.

But my favorite part of a steakhouse just might be the side dishes. And Capital Grille did not disappoint.

The mashed potatoes are made with sweet cream and lots of butter. I probably took more than my share — all’s fair in love and war.

Asparagus can be a difficult dish. Restaurant after restaurant undercooks it, leaving it hard to chew.

But not here! It was just soft enough while retaining some crunch.

Ah, dessert.

My favorite was the flourless espresso cake. Less sweet than most, it has a deep coffee aroma.

It was the ideal end to a fabulous meal.

What are your favorite steakhouses? Leave a comment and let us know!

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The AI Gold Rush

Venture capital investment in AI is exploding. But are we setting ourselves up for disaster?


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From a report out this morning in The Wall Street Journal:

Analysts at research firm PitchBook predict that venture investment in generative AI companies will easily be several times last year’s level of $4.5 billion. That is driven in part by Microsoft’s $10 billion investment in January into OpenAI, the startup behind the wildly popular ChatGPT bot. In comparison, such investment totaled $408 million in 2018, the year OpenAI released the initial version of the language model powering ChatGPT.

VC’s are funding startups with no revenue at valuations of $50 million, $100 million, or more:

LangChain, an open-sourced library for software developer tools with no revenue, recently closed a $10 million round at a $50 million valuation, according to people familiar with the matter. A few weeks later, venture-capital firm Sequoia Capital swooped in with more funding and quadrupled the valuation to around $200 million, they said. 

I have no idea how to play AI right now.

I see what seems like the coolest generative AI tool ever. Then, a week later, I see another tool that blows that away.

When a market is moving that fast, it’s almost impossible to place a bet. So for now, I’m sitting back and watching how AI evolves.

Do these frothy rounds in AI startups make sense?

With an exceptional team, a pre-revenue bet can work.

For example, the Journal article mentions Essential AI, a startup founded by two of the leading AI researchers at Google. They raised recently at a $50 million valuation.

Making a bet on incredible founders at a $10 million, $25 million, or maybe even $50 million valuation can work. But when the numbers stretch into the nine figures, it’s very hard to make money.

With AI, we risk repeating all the mistakes we made in crypto.

$100 million seed rounds with no product or paying customers just don’t work. When the entry price is that high, there aren’t enough big wins to cover all our losses.

I want defensible businesses with real customers and revenue. And the entry price has to make sense.

I think AI will change the world. But as an investor, I’m going to be patient.

How are you playing the AI boom? Leave a comment and let us know.

Great to be back!

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Fundrise

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‘There’s a Lot of Agony Out There’: Munger on CRE

“A lot of real estate isn’t so good any more,” Munger said. “We have a lot of troubled office buildings, a lot of troubled shopping centres, a lot of troubled other properties. There’s a lot of agony out there.”

Berkshire Hathaway Vice Chairman Charles Munger has truly seen it all. At age 99, he’s an astute observer of markets and remains Warren Buffett’s right hand man.


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So when he sat down for a rare interview with the Financial Times this weekend, I couldn’t miss it.

Munger notes that many US banks are holding bad loans on commercial property. Those properties are declining in value due to higher vacancies and interest rates.

Loans for commercial real estate aren’t like residential mortgages. Instead of being fixed for 30 years, they usually must be refinanced every 5-10 years.

Banks are increasingly wary of CRE loans. From the Munger interview:

He noted that banks were already pulling back from lending to commercial developers. “Every bank in the country is way tighter on real estate loans today than they were six months ago,” he said. “They all seem [to be] too much trouble.”

If the refinancing happens at all, it will be at a much higher rate. If the owner can’t pay the new, higher payments, he may default.

That leaves the bank holding the bag.

And if the owner tries to sell, he faces a tough market.

Sales of office space are down 66% in the past year. There are no buyers at any price for vacant office space in NYC, according to a broker friend of mine.

Berkshire is staying away from this tough market. So is little old Francis — my real estate investments are in higher end apartments and fulfillment centers.

What’s the future for CRE? Leave a comment and let us know what you think!

This is the last blog for this week. I’m heading down to Kentucky tomorrow to visit my grandma!

See you on Monday, May 8th!

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Fundrise

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