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How to Build a Profitable AI Company, Recruiting in 2024; What to Expect, and more- Tactician #0033

January 11, 2024

11/01/2024

HOW TO BUILD A PROFITABLE AI COMPANY

Sanjay Dhawan, CEO of SymphonyAI, guides AI startup founders on building a profitable business in “How to build the foundation for a profitable AI startup”

  • Choosing Vertical over Horizontal Expansion:

    • "Building a broad AI platform or solution may be the biggest pitfall... A horizontal approach with more general-purpose capabilities aims for a wide audience... A smarter approach is to go narrow and deep — identify a specific industry use case with urgent problems that AI can solve well... Invest heavily in your technology and hiring subject matter experts to inform your software architecture and go-to-market strategy."

  • Fine-tuning Existing Models for Specific Verticals:

    • "There’s no need to spend valuable capital training a model on massive general-purpose datasets... Fine-tune open source variants of GPT to create domain-specific models... Tailored, vertically optimized predictive and generative AI together provide contextual answers to specific questions or generate and organize data for business insights."

  • Knowing When to Launch the Product:

    • Quote: "How do you know when your AI solution is ready for production?... Training and fine-tuning models can go on indefinitely... Creating a standardized benchmark... Compare your model against existing rule-based engines... There’s always a trade-off between improving the accuracy and relevance of your data and the resulting training costs."

  • Path to Profitability Amidst a Competitive Landscape:

    • "The coming year will mark a dividing line in the growth of enterprise AI... It will take more than an eye-popping product demo to attract investors... AI companies will need to demonstrate a thoughtful approach to their business... Profitability awaits those who move confidently forward."

RECRUITING IN 2024; WHAT TO EXPECT

Kevin Wheeler, Founder at Global Learning Resources, forecasts changes in the recruiting for 2024 in “What Does 2024 Hold in Store for Us?”

  • Generative AI's Dominance in Recruitment:

    • "Generative AI will dominate, and every product will attempt to incorporate AI... AI can automate and enhance various aspects of the recruitment process... Incorporating AI into recruitment products can lead to more efficient processes... AI can analyze the success rates of past recruitment campaigns and predict the efficacy of various recruiting channels."

  • Doubling of Recruiter Productivity:

    • "Because AI will augment so much of what a recruiter does, a single recruiter can handle a much larger requisition load... Professional hiring can be significantly augmented with AI tools, new processes, and a change in mindset... Recruiting leadership will be vital in establishing with recruiters what AI can do best."

  • Importance of the Circular Supply Chain:

    • "Because of demographics, talent shortages, and cost concerns, there is already more focus on retention, repurposing current talent, and re-recruiting former employees... This will be a year when developing the workforce will become central... By focusing on internal talent pools, companies can foster the development of skills and competencies necessary for a circular supply chain."

  • Adoption of a Four-Day Workweek:

    • "The likelihood of firms adopting a four-day workweek is increasing... In the UK, a six-month trial organized by 4 Day Week Global saw positive outcomes... While the concept is still emerging in the United States, companies experimenting with the four-day workweek report benefits."

INVESTOR INTERVIEW

  • Be Cautious of Overvaluation During Fundraising:

    • "Don't make the cap table a risk to your business... Raise smaller amounts of money, more frequently, that are more Milestone based where when you raise a round, you know what you're signing up for for the next 18 months and you feel good about getting there."

  • Understand the Importance of Data Before AI Implementation:

    • "You don't have an AI strategy without a data strategy... A lot of the AI value prop today really comes down to do you have your data house in order."

  • Regularly Evaluate the Company's Direction and Goals:

    • "You need to solve a real tangible problem for someone... At the end of the day, it's the boring stuff that really actually moves the needle and builds the big businesses."

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