20VC: OpenAI's Sam Altman, Mistral's Arthur Mensch and more discuss: Will Foundation Models Be Commoditised | Which Startups Are Threatened vs Enabled by OpenAI | Is the Value in the Infrastructure or Application Layer?

The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

The Twenty Minute VC

Finance, Venturecapital, Tech News, News, Siliconvalley, Technology, Investing, Startups, Business

4.4 • 637 Ratings

🗓️ 24 May 2024

⏱️ 22 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Sam Altman is the CEO @ OpenAI, the company on a mission is to ensure that artificial general intelligence benefits all of humanity. OpenAI is one of the fastest-scaling companies in history with a valuation of $90BN and $2BN+ in revenue.

Brad Lightcap is the COO @ OpenAI and the man responsible for the incredible scaling of sales, GTM, partnerships and business to today being over $2BN in revenue.

Arthur Mensch is the Co-Founder and CEO of Mistral AI. Since its inception in May 2023, Mistral has raised over $520M in funding from investors like Andreeseen Horowitz, General Catalyst, Lightspeed Venture Partners, and Microsoft with a current valuation of $2 billion.

Des Traynor is a Co-Founder of Intercom, and has built and led many teams within the company, including Product, Marketing, and Customer Support. Today Des leads all of Intercom’s R&D efforts, and parts of Intercom’s marketing.

Tom Hulme is a Managing Partner of GV (Google Ventures), and leads the European team. Today, GV has over $10BN in AUM and Tom has led investments in Lemonade.com (IPO), Snyk, Secret Escapes, Blockchain.com, GoCardless, and Currency Cloud (exited to Visa).

Tomasz Tunguz is the Founder and General Partner @ Theory Ventures, just announced last week, Theory is a $230M fund that invests $1-25m in early-stage companies that leverage technology discontinuities into go-to-market advantages.

Sarah Tavel is a General Partner @ Benchmark, one of the most successful and renowned venture firms in the world. At Benchmark, Sarah has led rounds in Chainalysis, Hipcamp, Medely, Rekki, Glide, Cambly and more.

In Today's Episode We Discuss:

Will foundation models be commoditised?
What is the end state for the foundation model landscape in 10 years?
How will large cloud provider incumbents approach M&A with smaller foundation model providers?
When will we see marginal revenue exceed marginal cost in the foundation model business model?
Where is the value: the application layer or the infrastructure layer?
How can startups know whether they will be threatened by OpenAI?
What are good tests/questions to know if you are in the path of one of the large foundation models?
How does the business model of SaaS fundamentally change in a world of AI?
Will we see the end of per-seat pricing in a new world of AI?
What is the right way to approach pricing in a world of AI? Consumption? Tokens?

Transcript

Click on a timestamp to play from that location

0:00.0	When we just do our fundamental job, we're going to steamroll you.
0:03.6	Ask the company whether 100x improvement in the model is something they're excited about.
0:08.3	The technology is commoditizing incredibly quickly.
0:11.7	I likened it to investing a few hundred million into a power station.
0:16.4	But you've basically got to depreciate that asset in these foundation models over a few months.
0:21.4	I just am a huge believer that the application layer is going to drive most of the value
0:25.8	because what you have to imagine is who owns the user over time.
0:30.9	If you own the end user, you're able to provide more and more value to them over time
0:36.5	and capture that value. Are foundation models commoditizing? Is there more value to them over time and capture that value.
0:38.3	Our foundation models commoditizing, is there more value in the application layer or in
0:42.8	the infrastructure layer? Which application layer startups will get steamrolled by OpenAI?
0:47.7	There are so many core questions in AI today that are simply unanswered.
0:52.4	And so today, I compiled eight of the best experts in the
0:55.5	world to share their thoughts on the future of foundation models and the application layer,
1:00.1	answering your core questions. But before we dive into the show today, when I invest in software
1:05.1	today, I think software is valuable when it saves time and makes something easier. But when it
1:10.5	enables the user to do something
1:12.2	they simply could not do without it, then it's insanely powerful and valuable. That's the case with
1:17.7	Teegas. Teegas, I literally could not live without. When I'm investing in a company, Teegas lets me see
1:23.9	the most incredible reference calls with experts in a space who work at competitive
1:28.5	companies or incumbents. These calls and data provide the most incredible insight that really
1:34.3	informs our opinions and investment decisions. I can then share snippets from calls with team members.
	...

Please login to see the full transcript.

Previous episode | Next episode

Disclaimer: The podcast and artwork embedded on this page are from The Twenty Minute VC, and are the property of its owner and not affiliated with or endorsed by Tapesearch.

Generated transcripts are the property of The Twenty Minute VC and are distributed freely under the Fair Use doctrine. Transcripts generated by Tapesearch are not guaranteed to be accurate.