Careful with early winners.
#68 Angelinvesting.it - From idea to Series A - Weekly Newsletter
Dear reader,
In the early years of the 'internet wave', a winner seemed to emerge: Cisco. After all, it provided the infrastructure at the heart of the new digital highways.
Over time, Cisco consolidated its position, but it became clear that the real value unlock of the internet was at the application level, Google, Facebook etc. gained much more from the internet than Cisco.
What today emerges as the undisputed winner of the AI infrastructure layer wave is Nvidia. The provider of chips that everyone wants to run LLM models.
I attended a conference this week where the managing partner of 500 Vc put Nvidia's and Cisco's stock performances side by side at the beginning of their respective waves. They are specular.
2 insights from this image.
1. At the AI infrastructure level, the game is not over. Chips designed specifically for the latest generations of AI models will come from many parts and lots of money and research will go into this field because there is so much value to exploit.
Takeaway 1: Today's state of the art will be obsolete in months.
2. Innovation in infrastructure creates opportunities at the application level and at the infrastructure level we are in the first inning. If hardware makes a significant quality leap, the AI apps built on top of it will in turn make a significant qualitative leap, opening the doors to new billion-dollar companies that today we can't even fully imagine.
Takeaway 2: The Facebook of the AI wave has yet to come.
There were other social networks before Instagram. It was when the quality of iPhone cameras practically gave every person a camera always in their pocket that a solution like Instagram seized the opportunity.
2 Tools to advance to pro
GPT-4 the least intelligent model we will use
Just yesterday, speaking in front of a class of students, the CEO of OpenAI explained that GPT-4 is the least intelligent model we will use. We will look at it with the same affection with which we think of Atari or Nintendo from the 90s
The model war is a war of friction (or its absence)
Google has recently announced that it will be possible to access Gemini, its flagship model, directly from the address bar within its popular web browser Chrome.
What is happening is that every big tech company is trying to push its own model in our faces to create habits in us users and thus win the AI agent war.
Meta will place its agents within Instagram, Facebook, and WhatsApp to make usage super simple. We mentioned Google's bar in Chrome. Microsoft has added a button on keyboards and in the menu for its co-pilot. We await Apple, which will retire Siri with a finally intelligent agent and a button for the AI impossible not to press in front of our eyes, near our fingers. Winning is about creating habits, winning is about removing friction.
1 Reason to smile
Keeping up with the latest in the AI world isn't stressful at all, they told me 😄
Have a great weekend,
Simone
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