Tag Archives: OpenAI

Inflection: Better than ChatGPT?

May 12, 2023 tremendousblog 4 Comments

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!

Today we are announcing the release of the first version of @heypi_ai, your personal AI.

Pi stands for “personal intelligence” because it provides infinite knowledge based on your unique needs.

Talk with Pi today at https://t.co/uD0fyCaWGe or by texting +1 (314) 333-1111. pic.twitter.com/C7YqwwixPb
— Inflection AI (@inflectionAI) May 2, 2023

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?

AI: Capital Bonfire?

March 21, 2023 tremendousblog 1 Comment

AI is the biggest opportunity in 20 years. It could also kill countless VC funds.

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I took a sip of some yummy espresso last Thursday and plopped down at the laptop. Time to dig into a deal memo from a VC I really respect.

He laid out a clear view of AI’s future. And if you’re an investor, it’s scary. 😲

Tons of startups are all racing to become the next hot thing in AI. They’re all doing the same things with the same tools.

Most will fight each other to the death. With differentiation nonexistent, margins are headed to zero.

Now, what if we add VC’s with billions and a bad case of FOMO?

A bunch of massively overfunded companies will fight to the death. No one will make money.

And many AI-heavy funds will be destroyed. Or as this investor put it, we are headed for a “capital bonfire.”

I tried to poke holes in his argument. But I couldn’t.

It’s not that hard to integrate AI tools into software. A founder I know did it in just 6 hours using OpenAI.

If you’re not something more than a wrapper for OpenAI, you’re not going to make it.

Geez Francis, you really hate AI, don’t you?

Not at all! I think ChatGPT and similar technologies are an incredible revolution.

But just because a new technology is incredibly useful doesn’t make it profitable. Toasters are very useful, but making them isn’t a great business.

There are too many other companies making the same thing.

Aggravating the defensibility problem are massive valuations.

I’ve seen AI companies with no revenue raise “seed” rounds at $150 million or more. I even saw an AI hardware company recently raising “seed” at over $400 million!

These valuations don’t make sense for companies that are barely off the ground. As Fred Wilson of Union Square Ventures has proven, investors can’t make money with $100 million seed rounds.

So who wins in AI?

Big tech will be huge winners. Microsoft practically owns OpenAI.

It has also integrated AI into all its Office products. You can even ask your calendar to prepare you for an upcoming meeting!

Microsoft owns the platform many people already use. Then they serve this captive audience some great AI features.

That’s a winning model.

Another winning model is focusing on data. I’m looking for companies focusing on unique data sets, data cleaning, and better data processing.

Data fuels every AI model. Better data means better outputs.

Even if many AI companies go bust, selling data services can still be a great business. Airlines have a way of going bankrupt, but Saudi Arabia’s doing pretty well selling them fuel.

Let other investors drop money onto every AI startup from a helicopter. I’ll be taking careful kill shots at big game.

After all, we only have so many bullets.

Where do you think AI is headed?

Google is Losing the AI Race

January 25, 2023 tremendousblog 4 Comments

Today, Google is the king of search. But is it about to be dethroned?

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The search giant seems to face a new competitor every day. ChatGPT launched on November 30, with Perplexity and Allsearch coming shortly thereafter.

The “page of links” is starting to look antiquated.

Meanwhile, with nearly 200,000 employees, Google has released nothing in response. But new reports indicate Google may finally release a competitor this spring:

In addition to an ethical AI chatbot such as LaMDA, Google is now planning to reveal 20 more AI-based products at its I/O conference scheduled for May 2023. ChatGPT has sparked worry about the use and viability of conventional search engines, as the chatbot aims to provide answers to searches instead of just giving relevant links to users.

Taking over 5 months to respond to a mortal threat to your business is unacceptable. Google should’ve worked day and night to produce a ChatGPT competitor within 90 days.

So what’s the holdup?

Google has shown wariness in revealing AI products and services, especially with the raging debate on the ethics of using AI, with the potential for bolstering biases present in training data. All current AI offerings by Google are heavily restricted in terms of what they can be used for.

Large companies are obsessed with risk. Meanwhile, startups have to release something or they’re dead in the water.

By the time Google does release a competitor, it may already be outdated. OpenAI’s GPT-4 may come out in the first half of this year.

I don’t know what GPT-4 will be capable of. But seeing the massive improvement between GPT-3 and ChatGPT, I expect it to be very impressive.

How fast you launch and iterate is especially important in AI because AI tools can improve at incredible speed. From a recent column by economist Tyler Cowen:

ChatGPT, the model released late last year, received a grade of D on an undergraduate labor economics exam given by my colleague Bryan Caplan. Anthropic, a new LLM available in beta form and expected to be released this year, passed our graduate-level law and economics exam with nice, clear answers.

If that wasn’t impressive enough, ChatGPT and another chatbot just passed the United States Medical Licensing Examination. I certainly couldn’t do that!

Maybe Google will release a ChatGPT killer and blow us all away. But I expect to see it fall further and further behind, mired in complacency and risk aversion.

What do you think the future holds for Google? Leave a comment at the bottom and let me know!

Tremendous

Tag Archives: OpenAI

Inflection: Better than ChatGPT?

AI: Capital Bonfire?

Google is Losing the AI Race

An angel investor's take on life and business