Baffles me that 18 months ago we were discussing a “VC winter” and possibility of a ‘07-like recession to reign in the excess of late-2020 & 2021.
Now it feels like froth and companies that barely do what they claim is everywhere. Yet so much VC money is still on the sidelines.
People say there's more AI investment, but AI has always been heavily overinvested since 2015. Even back then, fresh PhDs could expect million dollar annual TC. People who believed AI would eat the world have been buying Google, Meta, Tesla stocks for years because those were the closest. Those stocks aren't rising much. Only recently did retail investors realize that maybe NVIDIA would be profiting from the AI boom as well.
You have to take into account all the delays. Meta didn't drop in stock because they were planning for the Metaverse, it dropped because they admitted that Facebook was no longer their core business. Everyone knew FB was dead for a while, the name change was a catalyst. The metaverse isn't terrible business though - Roblox is bigger than many banks.
Then there is the AI hype. You see someone like rabbit selling a lot and getting more money... and that's turning into another Jucero.
And that makes OpenAI look a LOT like Theranos... all hype and no substance. I have a pretty solid argument that this is likely the case. Lets go back to GPT 3... Sam in front of congress, where all talking about the singularity. The deal with M$.
That MS deal had ONE interesting bargain in it. They could have everything till OpenAI got to AGI. Thats a pretty drastic bet to make.
And here we are, after board fiasco, where any one who might have said the word safety 12 months ago has quit.
It's the google engineer who thought their efforts were AGI, it's the MS paper saying hints of AGI. I think everyone at open AI got high on their own supply. I think they had an idea that if they just fed it enough info, if they gave it EVERYTHING that some how real AGI, or sentience or sapience would emerge.
Candidly from where they sat it probably looked pretty close, and it's hard not to have rose colored glasses. More so with Sam as the hype man on TV. The problem is that it completely ignores the history of every AI effort that has gone on since the 50's ... where they think they are close and then reality swiftly kicks the project in the balls. It's not like this very thing hasn't happened every time before. Us getting close to AGI is like fusion being 10 years or 25 years away, always... you wont ever get there if you keep covering half the distance to the goal.
Meanwhile google, FB, M$ cut staff and bought hardware on this bet. The thing is no one has ANYTHING good to show for it. And for as much promise as it has, I haven't seen a "reduces hallucinations" paper, or one that has an inkling of how to make the systems more honest.
My bet, that there are a bunch of engineers out there working on cool shit. They are bootstrapping because they dont need VC's any more. There isnt a massive investment upfront in "infrastructure" and most of them are skilled enough to tie scale to revenue and do it so there is margin. I suspect that you won't get another google or FB out of this one... you're going to get 1000 companies that do 5-10 million a year with sub 10 total staff.
Immigrants are the canary in the coal mine. When more people are unemployed, the local talent is already fighting for available jobs, so companies don't hire as much from abroad.
This is based on relatively flimsy evidence, but it's how I currently see things.
Crypto really poisoned the well, IMHO, bringing outright scams front and center. The dotcom bullshit from 30 years ago were mostly decent ideas executed too early. Speculation on electronic baseball cards depicting cartoon monkeys was always madness.
Anyway every company stole the NLP/LLM/Rag model out of in chat bots got better results no need for ui budget (looking at you salesforce). Some tasks like call centers were pretty much also made for LLM. Other AI advances like sorting packages and treading the line between algorithm and AI do well.
More importantly big companies are making tons of money and there’s not been appreciable advances in technology. LLMs will be local and integrated it won’t be called AI. Workflows will improve etc. right now it comes from big tech with cash on hand it looks like big iron from the 80s. The internet didn’t see anyone control it and was relatively cheap to get into. Create a 3d image scanner that can process millions of say walnuts on an assembly line as good or bad isn’t sexy and niche… and expensive.
So we are in a lull companies are bringing dev in house and aren’t being experimental. Unless you have one of 7 big tech firms behind you won’t get looked at. So right now it is get to the state in b2b to just get bought.
Also b2c is controlled underneath by AWS or a big cloud provider.
Good thing companies are realizing they don’t need Google levels of high reliability. I see a real progression back to on prem with slimmed down K8S variants with Chromebook like devices. Google spent a lot making those “just work” as anyone installing even Ubuntu can tell you. But we are basically at the point someone will create a business like Steak deck with hardware compliance. Servers where apps can be deployed like VDIs and a resurgence away back to guy in his garage software development. It’ll still need VC funding but with secure infra you can have on prem SaaS catering to the mid market.