Stop Ignoring AI | Ep 963

0:00Wake up. AI is here. Open Claw moment happened over President's Day weekend and it started a month earlier and it was already acquired for a billion dollars by OpenAI. If you're not paying attention to this, then you will be left behind. That being said, I am not here to fearmonger. I'm here to try and prepare you for what I think is going to be the biggest shift that's going to happen in Main Street, not just the tech businesses. If you're still even doubting this at all, this is kind of my newsflash for you, is that AI will never be worse than it is right now. And if you assume any rate of improvement, over any reasonable time period, learning how to use AI should become your number one priority, your number two priority, number three priority, and your number 10 priority.

0:39And so that's why in this video, I'm gonna share some ways to think about AI and use cases right now that you can deploy today or by the end of this video to make significant changes in your business or star one or how you work within a larger business. Because I'll show you how to safeguard your role there too, because I think it's important. This is also for my team. So there's never been a better time to start an AI first business to disrupt an existing market because all the people in that existing market are so busy running their business rather than learning AI and using words like AI first rather than actually being AI first.

1:13And so the advantage that you have if you're starting out is that you have time. But the thing is, is that every single skill you're able to stack into your ability to use AI is going to give you disproportionate leverage over your competitors. And so having started some companies in this period of time that I'm not as public about, We have companies that revenue per employee we're talking about in the millions per year per head because day one we started that way. Because as much as people want to say they're AI first, if you have a big organizational chart of people, it's very hard one to get people to do stuff that's new and uncomfortable, which technology typically is.

1:44And then also because people aren't willing to make the hard conversations of saying, hey, we automated away this role. Now, what people then think is, oh, well, let's find something else for Danny to do. But the thing is, is that I would encourage you to raise the bar for the whole company and the people who who can meet that new bar get to stay and the people who don't, don't. And I'm sorry. And I know that's that's ugly and that's harsh. But like this is reality. Right. And like there was basically let me play a little thing by Jerome Powell. He just said this, I think, yesterday, two days ago about how there was zero jobs growth in the private sector.

2:16Think about where that is. Not that the economy is not doing well. It's that people are automating jobs away. All right. Now, again, this video is not to scare you, but this video hopefully at least motivates you to take some action because I think that it won't happen and then it will happen very quickly. So in game theory, the most flexible system survives. And so it's very much like business Darwinism, if you will, which is that you like, it's the people who can adapt are the ones who survive. It's not the strongest or the smartest people who are the most adaptable. And so that means that when there's a change in the environment right now, you have to change, you have to adapt.

2:49and learning how to use the tools is the first and best way that you can do it. For those of you who are scared to use AI, first off, get over it. But beyond that, you often risk more by not adopting new technology than by fearing the potential downside that a small percentage of people experience. So some people are like, what about AI safety and all these different things? Like I'm worried that AI is gonna take my credit card and go spend it. Of course, there's weird edge cases where someone gave too many permissions to an agent and they didn't have enough guardrails installed. But it's like saying I got hacked on the internet so I should never use the internet again.

3:20It's not good reasoning, right? And so why don't more people adopt AI? Well, the reason is more like complacency, right? There's a short-term cost that you have to incur in order to learn a new thing, period. So it's just like training an employee. If you're thinking to yourself, well, I don't wanna train this employee because it's gonna take me time to do that when I could be doing the work. It's like, yeah, but as soon as you train them, then they can do the work forever, right? It makes sense to do it. But when you think too short-term, which most humans do, then you end up losing to people who can think even a little bit more long-term.

3:52And I will, I will repeat this tweet that I've said before, because I think it's so relevant right now. It takes about 20 hours to become proficient in any new skill, but people delay the first hour decades. And so I promise you, if you take a weekend and say, Saturday, Sunday, I'm going to sit in front of this computer. I'm going to figure out how to do that. I'm going to figure out how to get an agent to do something for me. All right. If by the end of the weekend, you haven't completely built something, but you actually tore the, you know, you tore the wrapper off. You actually got your hands in it.

4:15your understanding of it will increase more than any amount of articles that you can read that are fear-mongering and baiting you in, right? That are just getting it for views and impressions. Let's shift to like what this actually looks like within an organization, whether you're working at one or you're leading one or you own one, is that you have to stop thinking in role-based thinking and start thinking in workflow-based thinking. So let's break this down tactically. For every hire that you're considering, you want to write down the four to six things or eight things or 10 things that that person actually does, does with their hands and their eyes and like in their mouth does stuff.

4:49All right. And then ask whether each of those activities could live inside of a workflow instead of headcount. And so the old thinking or the old paradigm is I need to hire an editor. The new thinking or paradigm is what are these five things an editor actually does that creates a video? And each one of those things should be a workflow. So let me just give you a visual to kind of drive this home. So let's say that you have an organization that looks like this. Okay. Very simple. Each of these roles has tasks underneath of them, or at least they should, right? Of course they should. But all of these is to organize humans, not to organize the inputs and outputs.

5:29Because in an organization, if we were to do something perfectly, we would have it much more like a manufacturing business. Now, what does that mean? Every business at its most basic level, takes raw inputs, adds some special sauce, and then you get an output that's more valuable. And so in a service business, it means you take raw talent, you add training and skills, or you put multiple of these skills together that when those skills taken in aggregate are worth more than any of the individuals on their own, right? So if you've got somebody who knows how to write, somebody who's had to read, somebody who's had to record, somebody who's had to edit, put all that together, all of a sudden you have an advertising agency and somebody else who can buy ads are great.

6:03You have an advertising agency, right? And so, but the thing is, is that this is our organizational structure is to organize communication between humans and hierarchy for decision-making. But if you had the same rules from the beginning of how everything should be created, then all of these little dashes that I have underneath of here, which are the tasks that someone does, should just be organized in a linear fashion that then create an output. And so the key is not saying I'm going to automate away this person. You just have to look at one layer underneath of that and say, what are the 10 things this person does?

6:35Let me see if I can just automate this one task and this next task. And if you are that person, if you're not automating your own job, you are missing the boat here. Like I was talking to a good friend of mine who is a very good entrepreneur last night, and he spun up a division within his company. And the sole thesis or mission of that business is to put his much larger business out of business. And so if you're not thinking about that same level of like, okay, well, I'm going to take 20 % of my time to try and put myself out of a job. Because the thing is, is if you don't adapt, you will eventually be out of a job.

7:05The question is whether you're going to be the one who controls that automation or somebody else will. And so let me talk about what the future of business is going to look like, at least in the medium term. The medium term is going to be BYOS. So what does that mean? It's going to be bring your own software or BYOA, bring your own agent or agents. And so when you approach a business, and this means that also there's going to be tremendous earning power, even at the employee level, which is, you know, shit on by the gurus of the internet. But if I can approach a business and say, I am your entire marketing department.

7:40And so famously, maybe we'll post it up here. Anthropic has one person in their marketing department. How is that possible? Now, of course, they get tons of PR. There's other things that I think help them out. But the big point here is that they've got one guy who's doing it, whether that's just marketing lingua or not, we can be sure that that one person is still doing a ton of stuff. All right. And it's not really that that person's doing a ton of stuff. They have automated and created agents that do a lot of that work for them. And so all of a sudden, if you think about the marketing spend that a business would allocate for an entire department of people to get an output, if you can get that output because of agents that you've trained on your way of doing things, then you become very valuable.

8:14Now, can you do that as a contractor and start an agency around it? For sure. Can you do it because you want to embed within a company and get a slice of equity? Sure. Can you do it just because you want to get paid more cash? All of these are things that are available to you, but they have never been available until now. Think about what businesses needs in terms of functions and outputs and just erase the titillism that exists in the private market because I do not think it's going to survive. And so if you are that employer, that entrepreneur, and you're like, okay, well, I want to, I want to do this stuff, right?

8:41I want to, I want to actually like use AI. I want to have agents that do work for me. Where people fall off is that they're not training AI the way they would train a new employee. And so they have the, how do I say employee? They have the agent do something and the output goes back and it sucks. They're like, oh, this will never work. Again, I will remind you, this is the worst that will ever be. Number one. Number two, if you had a brand new employee and then you said, do this task for me, and then they give something back to you, would you immediately fire them? Probably not. You'd be like, oh, I just need to train you more.

9:13And if you think, oh, well, AI can't do what humans can do. I really want to break that. I want to own to destroy this for the people who don't get it. And if you do get it, then maybe you need to send this to your employees, your team, because this is real. Humans learn the reinforcement, meaning you do a thing, you get an outcome, good or bad. If it's good, you do more of it. If it's bad, you do less of it. That's how humans learn, period. And so when someone says, ah, but you know, this person has such good taste, it means that they recognized a pattern, they communicate that pattern and they were rewarded for doing that.

9:48And so they do more and more of it. And so they get better and better at recognizing patterns. Guess what's really good at recognizing patterns, even better than humans? Computers, right? And so fundamentally, you train a computer the way you should train a human. The reality is that most people don't train humans like they should train computers. And as a result, they're bad at training. But one of the things that if you've ever followed my channel at all, I'm a big believer in thinking through operations, thinking through observable behaviors, right? And so this has actually been an amazing translation for my skill set into training AI, because if you take all of the emotional words out of it, right, take all of the ephemeral, take all of the intangible out of all of your words, charisma, make it lighter, make like all of these words that people use and just say like, what do you want to have happen?

10:34Which most people do not do because they do not define what good looks like. If you can actually take the time to define what you actually want rather than expecting the other person to guess and somehow get it right, or how expect the agent to guess and get it right, which is really what we're doing, then all of a sudden you'll be able to be so much better as an AI trainer, which is fundamentally where you're going to be so that they can actually do the work that you want them to do and do it at a hundred times the speed with no complaints and at a hundredth of the cost. And so I'll give you an example.

11:04If you're like, hey, I want you, like this is a very simple example because most people can understand this use case, which is like, hey, I want you to write some copy for me. Right? So it's like, hey, write this email copy for me. If they write copy and it sounds like AI slop, it's usually because you didn't give anything to it besides write words that are English and correct and make it sound like the internet, which is fundamentally what AI sounds like. It was trained on the internet, right? And so it's not the best writing. But if you say, hey, here's 12 rules that you can never break. And here's 16 writing samples of mine.

11:32And I want you to write only according to this. You're going to probably get an output that's probably like five times as good at that. Now, if you repeat that loop a hundred more times, all of a sudden you'll have an output that's perfectly trained on the patterns, except with a person, they forget some of the things you said 16 times ago and it takes them time to go type it or time to go learn that feedback cycle. And those hundred cycles might take you a year and a half with a person, but it can take you a hundred minutes with AI. Some of you are not using AI at all. Some of you guys are AI laggards and are like, I don't need it.

11:59No one's ever going to replace humans. And good for you. I love that for you. It'll make it easier to beat you, but you know, do you. There are people today that use fax machines. There are people today who still count on their fingers. It doesn't mean that it makes them more likely to compete. It means that they are competing and still winning with a disadvantage, which means that they have to be so much better in other arenas, right? And so it'd be like not getting on the internet for your company. Are there companies right now that do not have websites and make money? Absolutely. Do they make as much as they could?

12:32Probably not. And so this is an absolute promise to you. is that throughout all of human history, humans plus superior technology beat humans with inferior technology. It worked from the stone age to the bronze age. It worked from the bronze age to the iron age. It worked from the iron age to the titanium age, right? Or the aluminum, which I think my Aussies say. You can see it very naturally. And so also I want to give this as a little bit like a tiny bit of stress relaxation for you, as long as it is humans plus tools against humans with other tools, then you are still competing against humans.

13:12And as long as that game still goes, you should feel endlessly confident. The day that you try to beat the machine, you will lose. And every time we've tried to say we like machines will never beat us at chess, machines will never beat us at. Go, machines will never beat us at. Insert X. They always do. Just like autopilot on planes, everyone is very against it. Now, there's going to be pushback on a lot of AI stuff, but not because of its function, but because of people's emotions around it. Real quick, I'm going to show you the exact 10-stage roadmap from zero to 100 million plus that less than 1 % of companies finish.

13:43I've now done multiple times. And so I can say with a lot of confidence that these are the stages as headcount increases that you need to get through. And I broke each of these down by eight different functions of the business, what the constraint feels like, like what are the symptoms of it when you're going through it, and then what steps we actually took to graduate. And we've done this across software, physical products, service businesses, brick and mortar, all of this, and it works. And it's my gift to you. It's absolutely free. And so the link's in the description, but you just go acquisition.com forward slash roadmap, just enter info and it'll spit it right back to you all free.

14:13Now in a world of infinite AI labor and intelligence, where the cost of intelligence and labor go to functionally zero, rather the cost of energy, the last valuable thing that a human will get paid to do will be to take risk. And so that is something that you incur that no one else can really take away from you, which is why I think money will exist in the future. It's just that labor won't have value. And that's where this gets difficult. So it'd be more and more difficult to provide value to a marketplace when you, yourself, your labor, your inherent work no longer has value when there's a robot that has infinite intelligence inside of it.

14:46It's stronger, it's faster, and it works for$200. It works for the price of the electricity that runs it. Very hard. And this is, again, not to scare you, but to prepare you for what is going to come. And so if you're on Main Street right now, and you're thinking, oh, like every company is going to become a technology company. You wouldn't think of yourself as a technology company today, but it's like, well, do you use social media? Do you use the internet? Do you use email? Do you use phone? These are all components of technology that you integrated into your business. And I would consider this the last bastion of where humans play that role.

15:23Now, obviously, GDP is in gross domestic product. The amount that companies have made per headcount has continued to go up. If we look at the economy, what are the two factors that drive output? It's education, aka skills, and technology, right? And so when you have infinite labor with infinite intelligence, there's going to be a big explosion in GDP or gross domestic product. There's going to be more companies than ever before. And I also think that when many roles are going to get an automated way, the amount of businesses that will bloom from this will be huge. But I will not say that I know, and I don't think anyone does know, but what are the few things that I can bet on?

16:00I believe in a barbell strategy for approaching the future. So what does that mean? On one extreme, this is the high risk, high reward. This is I'm fully incorporating AI on all my stuff. All my businesses are going to be AI first, AI native, AI forward. I have to be willing to have the hard conversations with teams to get them to level up. And if they don't, I have to have the even hard conversation that we no longer need them because we've automated away the role. I have to be willing to do that because guess what? You might not be willing to do that, but there's going to be a startup that just doesn't have to have that conversation that is going to already be automating those roles and they will beat you.

16:34That's the high risk, high reward side. On the other side, it's what are the few bets, and this is Jeff Bezos frame, which is what are the few bets that I can make that I believe won't change? What things will absolutely still exist? I believe that humans will still have bodies, at least in the near to medium term. So I think health related things will absolutely exist. So healthcare, fitness related stuff, all that stuff, consumables, food, supplements, all that stuff will still exist. I think in a world where there's way more robots and way more work getting done for humans, what will humans have?

17:08If we look at human history, we have more of one thing, which is leisure or downtime. So what do we fill our leisure or downtime with? Entertainment. I believe entertainment is going to boom. It's already big. It's gone. It's continued to grow as a percentage of GDP. And I think it will explode because I think people have more time on their hands. And entertainment is typically very cheap. And so if you want to like, you can make a full motion picture now. and there's this period of time where the prices have not adjusted to the cost basis associated. And so you can make some viral social media videos and get a huge amount of PR for a movie that you made entirely with AI and make$100 million,$200 million.

17:46And the beauty of that is it's all margin. And you can absolutely do that. So why don't people do it? Because people are afraid to take action. But is that there? Absolutely. I'll also give you something that will make some people uncomfortable, but it's just an absolute reality of business in general, is that if you actually really want to know what the bleeding edge of like, what's going to happen with anything is in terms of tech, as it incorporates in business, I know this is going to sound, it's going to sound a little bit off-putting for some people. Look at porn. Whatever porn adopts first eventually makes its way down.

18:16So what have we already seen happen in the porn industry? You've got AI avatar girls who are, you know, people are spitting up these AI avatars. They have an army of a hundred girls or guys, I don't know, whatever your flavor is, right? Or aliens. I mean, again, whatever you want, where people, and I'm not saying good or bad, I'm just saying pure economics, right? Where they don't have to deal with the drama associated with it. They don't have to film them. They don't have to give the, they just make videos. They render them. They send them out. They have chats. That is really just a chat bot that's going back and forth.

18:44Someone that's been trained on 10 ,000 porn related conversations and people pay for them. And so what I believe is going to happen in the future, I believe that humans will need a place to live. I believe they will need food to eat. I believe that they will have things they need to do with their time for entertainment. I believe those are industries that I would absolutely say like these things will not change. Now, which one wins? Who knows? But those industries I think will exist. And then I'll give you my hell in a hand basket frame. So what does that mean? If there's a world where everything goes to shit, then it doesn't really matter.

19:14Right? And so I have to walk myself back off of the apocalyptic angle of like, okay, well, if all of these things eventually, you know, disrupt and there's no, and there's a permanent underclass and no one has any money. Uh, and there's only a select few who actually leaned into technology to acquire all the wealth in the world. If that were to happen, you know, it's all going to be anarchy. Maybe, I don't know, but I just prefer to exist in a world where, you know, I I'm hoping for the best preparing for the worst. Um, but I am absolutely hoping for the best. And I think in the hell in a handbasket world, none of it will matter.

19:47prepare for sunshine and rain just be an all-weather type of person and i think if you do that you'll give yourself the best chance at succeeding whatever the next season looks like and i'll give you a final kind of thought thought experiment that might be helpful for you so i read this on a brian johnson post from blueprint if you've heard of him he's the he's the longevity guy he said what what people do not realize is that they've been training their entire lives to swim and you think that you can swim in all types of weather and you're going to become a better and better swimmer, right? And, you know, there's waves crashing and you're like, you know, you go from in a pool or a lap pool to a lake to eventually you're swimming off the coast to eventually you're free ocean swimming from border country to the next border country, right?

20:28So crazy levels. He said, but the change that's about to happen is a phase shift where you're swimming, but then all of a sudden the water boils and now you're in gas because the water all evaporated and you're flapping your arms. It doesn't matter how good of a swimmer you are. The fundamental physics of the environment will have changed. And so that is the change that we're on the precipice of. Now, hopefully this was not dim and gloom because I actually see this tremendous opportunity because humans are slow to adapt in general. So what does that mean? First off, if you're watching this, you're already probably ahead of most people anyways, because most people just exist, put their head in the dirt.

21:03There's so many people over age 50 that are like, I'm told for this shit. And guess what? They got all the money. And so what's really interesting is that all the people got all the money are going to quickly realize that it's going to go somewhere else, which is not to them because they did not adapt. So that's a big opportunity. There's also huge opportunities, obviously, in going to regular businesses and automating portions of their work. But when I said humans are slow to adapt, it also means their price sensitivity is also slow to adapt. Meaning if people are used to paying$2 ,000 a month for something, that embedded in that price is the typical cost of labor.

21:33And so if you can still charge that$2 ,000 price for whatever it is, right? And instead of it costing you$500 a month, it costs you$50 a month or$5 a month. The margin, number one, that you can earn is tremendous. But second, and more importantly, the amount of operational leverage you have, meaning the amount of people per dollar of additional revenue you need to create goes down dramatically. As in one person that can bring millions and millions in revenue in, it becomes much easier to scale. Because one of the biggest costs of scaling is just the coordination between humans. And so what I would encourage you to do, so you're like, okay, I heard all this stuff.