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Take Action on Your Ambitions, AI Startups Require New Strategies : #0073

March 07, 2024

“I told myself, ‘It’s time to take action on your ambition to learn to cook.’ So far, I’ve mastered cereal and I’m moving on to toast. I figure by 2030, I’ll be able to make a sandwich. Ambition is a slow cooker, not a microwave.”

07/03/24

Take Action on Your Ambitions

Why Read (10 minutes):

  • Understand how naming and pursuing ambitious goals can lead to harnessing AI and other resources to achieve transformative success.

Author:

  • Packy McCormick, Founder at Not Boring

Link: 

Key Concepts and Tactics:

  • View AI as a tool that can be utilized to pursue one's unique ambitions:

    • "Would a practically free army of near-genius employees help you accomplish the one thing you want to accomplish?... It’s more than just AI, though... All that progress can be overwhelming or empowering, and which of those two it is is entirely up to you."

  • Why you should name your ambition:

    •  "I’m here to argue that you should spend the time to figure out the most ambitious thing you could dream of doing with your one wild and precious life... When you name your ambition, it seems that the world conspires to help you achieve it, because you become more aware of all the tools at your disposal."

  • Ambition Attracts Resources and People: 

    • "Ambition is like mass. The more you have, the stronger your gravitational pull... Those who met him still speak of Steve Jobs’ reality distortion field, nearly thirteen years after his death. His ambition warped the fabric of reality around his goals."

  • Taking Action on Your Ambitions: 

    • "If you have some time today, this weekend, or in the coming weeks, spend some of it thinking through what it is you want to do. Name it, give it a shape and weight... You only live once, and you get to live in the most magical time."

AI Startups Require New Strategies 

Why Read (12 minutes):

  • Understand incumbents' advantages and rethinking competitive differentiation.

Author:

  • Jason Cohen, Founder at WP Engine

Link: 

Key Concepts and Tactics:

  • Startups need to understand that the typical advantages they had over incumbents in previous technological revolutions do not necessarily apply in the AI domain.

    • "The typical dynamics between startups and incumbents do not apply in AI as they did in previous technology revolutions like mobile and the Internet."

    • "In AI, the incumbents already have the innovation (whether through closed APIs or open source), while startups struggle as mightily as ever to find distribution."

  • Adapt to the New Reality Where Disruption Theory Does Not Apply:

    • "Incumbents typically cede market space to startups wherever there’s new, unproven technology or a new, unproven market, especially in spaces where they can’t use past data to predict the future. But in AI, they’re rushing to embrace new technology and uncertain markets."

  • Recognize that without data, there's no competitive AI product, and incumbents have a significant advantage in this area.

    • "For training, testing, benchmarking, and features, you need data. Incumbents have it or can afford it; startups are at another disadvantage."

    • "Incumbents can immediately leverage customers’ data to train models and tune algorithms, so long as they maintain secrecy and privacy."

  • The best talents in AI and software engineering may prefer the stability, resources, and exciting projects at incumbents, making it harder for startups to attract them.

    • "Great talent are happy at incumbents... they are getting paid above-market rates to work on the most exciting projects, with healthy budgets, with data to leverage, and with the ability to impact huge numbers of customers quickly without having to do marketing, sales, support, or accounting."

  • Since AI technologies, especially large language models, are increasingly accessible, differentiation should come from how you apply the technology, not the technology itself.

    • "There can be differentiation in prompt engineering, problem break-down, use of vector databases, and more."

    • "In a market where everyone has access to the same core technologies, simply matching the capabilities of established players is not a winning strategy."

  • Avoid considering AI as a market in itself and focus on how AI can transform existing markets or create new niches.

    • "AI is in the solution-space, not the problem-space... The problem a chatbot is solving is the same as ever: Talk to customers 24/7 in any language."

    • "It means the usual startup strategies might not work, so you need to think deeply and have a different point of view about how you’re going to win."

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