The 200 billions question

#64 Angelinvesting.it - From idea to Series A - Weekly Newsletter

Dear reader,

Sometimes I get the feeling that when it comes to artificial intelligence, too much emphasis is placed on the word "artificial" and not enough on "intelligence."

The heart of the paradigm shift we are experiencing is the availability of intelligence in large quantities at a low cost.

The last paradigm shifts before this were the advent of computers that brought us an abundance of computing capacity at a low cost, and then the internet, which brought us the elimination or near elimination of the distribution costs of digital products and information.

Looking at the next paradigm shift with the eyes of an era of abundance of intelligence, there are 2 types of startups that have the right to exist, in my opinion.

1. Startups that promise to make artificial intelligence cheaper, faster, or more performant. Commonly considered infrastructural layer. Startups like OpenAI.

2. Startups that leverage the new abundance of intelligence to meet known needs in a way that is 10 times better. Example: I cure you 10 times better than the best doctor. I make you lose weight 10 times better than the best personal trainer. I entertain you 10 times better than TV (TikTok). These startups are part of what is commonly called applications layer.

Today VCs are focusing their attention on the former, but the latter are the most exciting, and there are leading VCs who are starting to talk about the application layer as their priority. Check the AI's $200B question by Sequoia.

Have a great weekend,

Simone

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