AI Demos: Gatekeep, Deepgram, Claude 3 Haiku and more! | E1920

0:00So this is from our friends over at Deepgram. I don't know if you remember this. I'm going to just play a little snippet. Steve, there's a thousand bloggers at Microsoft and bloggers at people at Apple, I understand, are not allowed to blog. You remember this, right? Yeah. Deepgram has released its new tool where if you give it an audio file, they can do an intelligence analysis of it. So you can basically have it break out the intents of that conversation. So 25 % they felt was about requesting clarification about blogging. Yep. 9 % was about the RSS feed. 11 % was about inquiring about podcasts.

0:36And then the last bit was the zinger about the email. Oh, ask for zinger email. I love it. That's hilarious. It got the zinger. You remember at the end of that one? I made the joke and the audience left. Yeah. Wow. This Week in Startups is brought to you by LinkedIn Ads. To redeem a$100 LinkedIn ad credit and launch your first campaign, go to linkedin.com slash thisweekinstartups. Coda, a new doc that brings words, tables, and teams together. All your valuable data, plans, objectives, and strategies in one place. Go to coda.io slash twist to get a$1 ,000 credit. And Wistia is the all-in-one video platform for business with tools that help you create, manage, and measure the impact of your videos.

1:26Try Wistia for free at wistia.com slash startup. All right, everybody. Welcome back to This Week in Startups. I'm here with my guy, Sandeep Madra. He works at a company called Grok. Yeah, Definitive Intelligence was acquired by Grok. G-R-O-Q is your Grok. G-R-O-K is the Grok that Elon spun out from Twitter. So just so we're clear. How was your two weeks into the acquisition? How's it going so far? I see number of developers using the Grok platform has gone parabolic or it's doubling every couple weeks? It's going really, really fast. We are over 60 ,000 developers, over 15 ,000 apps. That's awesome.

2:11Yeah, we are rocking and rolling. So it has been really fun. We're adding capacity really fast. It is a bit of cat and mouse for us because every time we add capacity people consume it as fast as we can and so you know love all the support we're getting i was actually at a hackathon yesterday uh that we we kind of co-sponsored with the mistral team i saw that was that in the city yeah it was it's a great space there i don't know if you've been there shack 15 wow yeah it's it's the second level of the ferry building and i didn't even know this thing existed. It's a little bit like a WeWork slash Soul House.

2:51So you buy a membership. I did hear about this. Yeah. And here's the thing. There's so much space available when you go through the boom bust cycle. And I've seen this before during the dot-com and the Great Recession. People after the dot-com bust or after the Great Recession were like, you know, there's tons of office space for like 1 ,200 bucks a month. The five of us could be in a cool office. Maybe we'll spend 15 grand a year having an office. It'll be fun, right? Then it became, oh my God, my WeWork for five desks was like$9 ,000 or something. It was like, okay, we're spending$100 ,000 a year and this just makes no sense.

3:29What are we doing? Yeah. And that boom bus cycle is now, we're in that trial where people are like, oh, there's space available and it's free basically or close to free or yeah minimus and cost oh yeah might as well get a space and so that's really interesting when you think about space people get inspired by space too they see a space they're like wouldn't it be cool if a bunch of people came here and did something like a restaurant this space was a 10 out of 10 it was a 10 out of 10 it's the best space i've ever seen in the city for like a startup slash kind of uh you know community vibes yeah so i think we're gonna start to see a lot of that you know because why not we can startups ai event there maybe oh yeah we should totally do it yeah absolutely easy to do we just pick a day and then we just put a bunch of speakers and we're done yeah great idea demos too so we'll get that going okay yeah actually that's what we do is just demo or die kind of situation a couple of news items jaykel yeah oh there's news yeah okay so news and then demos okay so quick news in the ai world yeah let's go so i would say there's like One interesting thing, which is the CEO and founder of Stability Diffusion, he basically stepped down from the role.

4:44And that's one thing in and of itself. Let's not speculate too much on that. I think he said something interesting in his comment in stepping down, which is he feels as though there is, yeah, and exactly this is it, because you're not going to beat centralized AI with more centralized AI. And so I find that to be a really interesting comment in terms of, you know, stepping down. And, you know, they're open source focus. So I'm not fully sure. Well, I can speculate on what he's trying to mean here, but I want to see what you have to think when you read that comment. Because they're open source first.

5:23I met him, the gentleman in question, briefly when I was in the Middle East. He was in Dubai and we were at a salon together. seemed like an interesting cat, but yeah, he's doing an open-sourced image creator, right? And what is the market for these things, I guess, is going to become the question. So I think we're past the honeymoon phase and we're now getting into brass tacks. And so what investors are starting to ask, I believe, is, okay, how many subscriptions do consumers and businesses need to AI. Okay. If you are using Notion, I'm paying extra for AI. We're using Zoom right now. We've got the AI summary, AI companion.

6:06I pay for everybody on our team to have open AI. I paid also for Poe. And now I'm like, I'm pretty promiscuous in trying all these things. But I do think businesses and investors are going to start to say, okay, what's essential? show what do we need what are we going to use yeah and maybe the idea is not many people need image generation maybe that's like a niche thing you know how often are you creating images maybe for fun you and i could sit there and yeah you know go crazy all day but i think maybe we only need two of these in the world three of these in the world maybe we don't need 20 people making image creators maybe there's just not that much work and so the one built into adobe's suite right Like they have one that's legal and built into there.

6:52Then there's Dali, you know, and stable diffusion. There just doesn't need to be that many of them. And that's my read into his comments, which is we can't compete with OpenAI. That would be my read. OpenAI plus Microsoft plus Google Gemini, or maybe the Google-Apple alliance, which seems to be emerging. We talked about last week. So if you have these two competing factions, OpenAI plus Microsoft, and then over here you have Google and Apple, and then the open source community and the Google app, and then you have the meta. open source community. Maybe there's enough going on here that the world just doesn't need number four or five.

7:25And maybe he believed they would be number five. And that's like, I watched this happen with Uber, Lyft, DoorDash, JustEats, HostMates, Sidecar. There was a long tale of people going after that space. And at a certain point, consolidation happens. And this has been a rapidly evolving space. Maybe we're witnessing consolidation happening or capitulation. You know what? That was a very similar read to mine, which is the big folks are already here. It wasn't hard for them to get there from a technology standpoint. And it's very difficult to be, like you said, third, maybe not even third, but fourth, fifth, sixth player.

8:07because you've got the consumer folks covering it off. You've got the original pro folks covering it off with Adobe. And then you have the up and coming new folks covering it off with mid journey. And so really, like, you know, to your point that it's difficult to win in that space. And maybe, you know, he'll come at this from a different point of view as he rethinks what he's going to do next. Yeah. Or there could be something else to him leaving the company. Maybe people didn't want to work for him. We don't know, right? You sort of speculated who knows why he's leaving the company. When CEOs leave a company, there could be burnout, personal issues that they've got.

8:48Could be bad news inside the company. Maybe people don't want to work for them. Maybe they're not a great manager. Could be any of those things. And so sometimes when people leave the playground, they take their ball with them. So he could be leaving the playground or being pushed out of the playground. It's like, I'm going to take my ball with me. this space sucks, you know, but it might just be he couldn't compete. Maybe he just didn't have the energy to fight this fight for the next five or 10 years, which would be a mature thing to do. If you don't think you can fight a dog fight for five or 10 years to just be honest about it and just be like, it's hard.

9:19What's the point, you know? And sometimes you have to face that as an entrepreneur. I've had to face it in my career many times where like you're playing a certain game on the field, the game changes. I did a print magazine and then the world didn't want print magazines and i did blogs and the world didn't want blogs and i did podcasts maybe someday the world doesn't want podcasts i want shorts actually the world wanted blogs you sold too early there yeah you know i had a little bit of scar tissue from not selling too late the first time so that was like my 18 months in i'm selling this thing and i'm getting my first check yeah and then so i don't have to sweat the world wanted mahalo just google didn't want you to be it.

9:57And now we have a version of it with AI. And perplexity, yeah. And perplexity is using the same concept we're using. Just AI wasn't ready 12 years ago when I thought, you know, these 12 blue links would be better if it was like content plus services, plus Q &A. I mean, I had the right idea. I just was way too early. And I think that's like, you can forgive yourself as an entrepreneur. I think it's an important message here. Sometimes you're too early. Sometimes you sell too early. sometimes you're too early to the party sometimes you're too late to the party and who knows what's happening here yeah but it does seem like um maybe there just wasn't an opportunity maybe they didn't perceive there was a huge opportunity and also with the sale of um to microsoft of um hi yeah what was the parent name um last week inflection that feels like okay and we said this like how many large models do there need to be how many assistants do there need to be yeah you know It does seem to me like verticalized services in AI will win the day, and then there'll be three or four of these foundational models.

10:59And that's exactly what's happening, right? Navigating the B2B maze can feel really tough, huh? You're trying to hit the mark with all those top-tier executives. You want them to pay attention to your enterprise product. But where can you find all those big fish, the whales, the ones who call the shots and make the buying decisions for corporations, for startups, and everybody in between? Well, here's where LinkedIn ads is going to solve that problem for you. And I've used this. It is one of my secret weapons. LinkedIn means business. Business equals LinkedIn in people's minds. When you're on LinkedIn, you're in the business mindset.

11:35So you're going to really be thinking about business products and services. You're open to those opportunities. And LinkedIn recently passed a billion users. 180 million of those billion are senior executives. 18%. But hey, we all know about the 1%. 10 million C-suite executives. That's your CFO, CTO, CIO. These are the people who are always looking for a new product or service to make their organization run better, but they are on LinkedIn. That's why LinkedIn's ad platform delivers two to five times greater return on investment compared to other social media platforms. So easy to understand why this is because this is where all the business people are and they're in that business mindset.

12:13Super easy call to action. Make your B2B marketing everything it can be and get$100 credit on your next campaign. Go to LinkedIn.com slash thisweekinstartups to claim your credit. That's LinkedIn.com slash thisweekinstartups. No spaces, no dashes. Terms and conditions apply because they're giving you a hundy. J.K., you always have this magic to do it. A great segue into just the last news piece because I do want to touch on it, which is A16Z based a really good report. And I just want to touch on a couple of things for all the builders out there because we do this for a lot of builders. And yesterday, a lot of folks came up at the hackathon and they're like, oh, it was so awesome.

12:50You guys do the demos. So they're really cool to see it. But you should read the whole report. But I'm going to touch on three interesting bullets from this report. And it's generally value in the enterprise. First, you can see here the amount of average spend for LLMs is going from 7 million last year to 18 million. This is for enterprise companies. So large companies are saying their average spend in 2023, the average spend across foundation model APIs, self-hosting and fine-tuning models was 7 million across dozens of companies we spoke to. So they spoke to a couple of dozen companies. Yeah, it does look like the average spend per enterprise went from 7 million to 18 million is the estimate.

13:30So the actual was 7. So they're two and a half times in it. What would this be the equivalent of the cloud computing revolution? Even faster, right? Like, you know, this is a CAGR, which is like, you know, growing really, really fast. Right. And I think it's faster than anything we've seen before. And look like, you know, they call it like anywhere from two to five X. Right. And more workloads going into production. So this is good for folks that are building. Okay. I thought this was interesting in terms of like where the allocation is. Yeah. Where the money is for general. Where is the money for general AI coming from?

14:05So they asked 25 enterprises, I'm guessing here. It says dozens. They didn't say two dozens. They said dozens. Dozens of companies. Okay. Oh, dozens of companies. Yeah. So when you say dozens of companies, that would mean like 24, 36 companies probably. So in the second one, where do they allocate this from or reallocate? So they're saying the budget doesn't exist. Well, one company cited saving$6 million for each call served$6, which call served by their LLM power customer service for a total of 90 % cost savings. That's a reason to increase their investment in Gen AI eightfold. Okay. So you're using one anecdotal story there.

14:40Got it. But what I would say here, J. Cal, is when you're building in the earliest phases, and I've seen this in two previous lives. I've seen it when I had a mobile business and I had a cloud business. A lot of the early budget comes from the innovation teams because they're the ones within the enterprise that are tasked with looking at this. But to see that we're already at a place where 75 % of the budget is not coming from innovation, this is really good. Got it. So this isn't the innovation budget where like experimental stuff goes, okay. You know, Vision Pro comes out, AR, VR. Okay, we'll put a little bit of money into that.

15:17Okay. Yeah. Here, 24 % innovation, 76 % other. Business unit budgets, 21 % is the next highest. That means somebody in a business unit, like customer support said, hey, I want to allocate my budget towards this and away from something else. Reallocated from the IT group, 15%. Net new IT budget for LLM, so that's 19%. So somebody said, hey, I need to increase our budget. Yes. Give me some money for this. Reallocated from other AI, 13%. R &D product development, 8%. So yeah, it's definitely immediately having an impact on enterprise is your point. I can't argue with that here. Yeah. And I have one more that I want to pull up and then we'll get into our demos here, which is interestingly showing which models are enterprises using.

16:03And so let me bring the share back here. And by the way, I found in the first paragraph here, over the past couple of months, we've spoken with dozens of Fortune 500 and top enterprise leaders and surveyed 70 more to understand how they're using, buying, and budgeting Gen of AI. We were shocked by how significant the resourcing and attitudes towards Gen of AI had changed over the last six months. though these leaders still have some reservations about deploying generative AI, they're also nearly tripling their budgets, expanding the number of use cases that are deployed on smaller open source models and transitioning more workloads from early experimentation into production.

16:39That says to me that they know it's not ready for prime time, but they're trying to make it ready for prime time. So there's some recognition that it's hallucinating. How would you interpret I would say that they are ready to push into production. And these next two charts, which will be the last ones, and we won't go over the whole report, but this is really fascinating because you can basically see which model providers or enterprises are using. And you can see here that overall, OpenAI is still the clear leader. which is you know which 100 of the enterprises are trying to open ai are open ai is that that's that's impressive so 70 of the 70 yes in fact 70 companies or 70 leaders said they were using open i yeah and 63 said they were using microsoft google no no i'm sorry google google yes yeah um and 50 of it was testing 13 of it was production yes llama 30 testing 11 production production anthropic 34 we're using but not in production uh mistral 17 who here 17 so basically yeah people are uh testing everything and slowly putting stuff into market makes sense and then the last one and we'll go we'll get into our demos which is um right here open source is booming and you can see here where the shift is really happening um across you know this little uh pie chart okay so we have a pie chart here with three sections and the three choices are what for those people who are listening yeah yeah the the three sections are no plans to increase open source that's the that's 18 then 41 say they will switch to open source when the performance matches and 40 another 41 saying will increase or already use majority open source this is really wow so this means 82 of enterprises want open source they don't want a closed model yes wow you know this is so interesting because you remember in the early days of open source 20 years ago everybody was like yeah nobody wants to use it now enterprises are basically defaulting to it yes it's incredible what open source has done and this means you would be long llama anthropic um no anthropics not open oh no you'd be long llama llama you'd be long one of the mistral models mixed trial yeah right and then you would be short and then the open source google And then there's an open source Google one.

19:29Yeah. It makes sense. I think this technology is so powerful that putting your entire company in the hands of Microsoft and open it or Google and Google cloud. Some folks might feel uncomfortable with them having so much say in what they're doing. Right. That's how I read it. And they want to be able to not be not have that dependency. Right. So that's what I think I would read in here is open source means not dependent, not taking a huge risk, which is so funny when you think about it, because we used to have this expression, nobody ever got fired for selecting Microsoft and then Microsoft. So, you know, now it's kind of the opposite.

20:13Nobody ever got fired for picking an open source project because with an open source project, you know that you can't get rug pulled. You can't get price gouging. you know you're just fascinating which which makes it even more perplexing why open ai went closed because the statistics here are showing don't go closed right that's what the statistics are saying the statistics are saying the market enterprise at least the enterprise market wants this solution uh in a certain way and people are just ignoring them so there you have it folks the great ignoring of the consumer base okay listen i got a lot on my plate gotta do a couple podcast.

20:49I got Founder University, Launch Accelerator, and all my personal life and, you know, things I want to do. So there's just a lot, but I'm able to manage it all with an amazing piece of software called Coda. Coda is the all-in-one platform that combines the best of documents, spreadsheets, and apps. Here's an example. We use Coda to run the Founder University. Every week, we ask all of our founders to submit a progress update, and then all of that goes into Coda as a database, and then we can sort through all of those weekly updates and look for trends. And Coda also allows us to send automated reminders to all those founders to send in their updates.

21:22And then we track week over week growth by generating charts. So if we see strong growth, we'll reach out and we'll invest in that company. And it's all done through this beautiful product called Coda, C-O-D-A. Here's your call to action. You can use this software to solve any business problem. It is extraordinary. And if you want that platform to empower your startup to strategize, plan, and track goals effectively, you can get started for free. Coda wants to support founders, so they can give you$1 ,000 in credit. $1 ,000 in credits at coda.io slash twist. What a generous offer. It's a limited time offer, so I want you to get it right now.

21:55coda.io slash twist. That means you can begin planning right now to make your startup just really tight. c-o-d-a.io slash twist to get started for free and get that$1 ,000 credit. Can't beat the price. I love Coda, and you will too. You know, there's this notion that is, cross-pollinated between enterprise and consumer, I believe. Definitely in Silicon Valley more than other places, which is moat. And obviously in consumer, that's important. But I think in enterprise, the notion of moat being tied to something proprietary or closed is a bad idea, but folks maybe tend to go in that direction versus something that is performance or price.

22:39you know so this lock-in thing i think silicon valley and sas and everything that's happened in the last 10 plus years are still working through this yeah makes sense all right let's do some details let's do it yeah of course let's go well i mean we're starting to see where the industry is going to wind up and it's it's you know which if you dovetail the two stories like stable diffusion then is an open source project with a close with a hosting project that would argue that they were more valuable because enterprises would want the open source solution so there's something with the founder leaving that's a little bit wasn't that the same founder who um allegedly screwed his co-founder out of their shares and bought a bunch of the shares back from them there was a little bit of diciness there was some story related to yeah getting rid of a co-founder or something and then getting all their shares and so okay let's get started okay first one today i really like this one um they are under a lot of pressure today because it's it's been going viral what it is it's called gatekeep.ai okay and what they do is uh you you generate something i i did this already because it's it's it's been slammed today but you ask it for a concept they have some pre-built ones here uh i did one myself which i'll share here which is tell me about put options because i know you know i know i know how much uh j trading loves you know it's trying to i don't do options trading i gotta get to that nancy pelosi level here of taking more exactly just follow her trades there you don't even follow her trade so what i did was i just said tell me about put options and what this did was and i really like this a lot it created a little short video i'll play it in a second it gave me a chat about it and then it gave me a little uh summary down here in a transcript so i'm just going to play this for that made 30 seconds.

24:29Put options are financial contracts that give the owner the right, but not the obligation to sell an underlying asset at a specified price known as the strike price within a specific timeframe. Let's visualize how a put option works. Imagine we have a stock whose price is decreasing over time. Okay. I'm not going to play the whole video. I think this is awesome. It made this explainer video, the graphics, the voiceover, and the graphics, He takes the voiceover and gave me a little chat. So imagine, you know, you're trying to work through trying to understand something or you're doing something with your kids when they're trying to learn.

25:06You know, this is a real combination of the video, the chat experience. It's Khan Academy in a box. It's like a Khan Academy. Oh, a good way to put it. Yeah, it's AI Khan Academy. Let's try. I want to try one. Explain to me how a keystone in an arch works. to me uh in uh and arch works it does take them a few minutes and yeah it's all good well because it's generating a video this is generating a how-to video that you could then publish on youtube and now youtube is going to be flooded with these and hopefully they're correct because if they suck then and it's wrong information that's not helping so this is where synthetic data or the moment where data can be degenerative data revolution is going to pollute the hell out of the internet so it's almost like you want to have the human internet ends at 2023 and going forward youtube is going to be filled with this stuff now is this stuff been checked is it correct or not we're going to have to create a whole cleanup crew because as we know it gets things wrong all the time and so what if this is wrong what if it explains the pythagorean theorem wrong what if it explains how you know the keystone works incorrectly and now we start flooding the internet i my replies are frequently on x twitter generated by ai i can tell somebody's got an ai oh really reply bot and it's like oh you enjoy beef ribs in texas beef ribs are a nice thing to enjoy i hope you enjoyed your beef ribs continue enjoying your beef ribs from terry blacks and i'm just like uh what's going on here yeah okay and it's obvious like we're going to pollute the hell out of the internet uh with this garbage and so i i'm just worried about youtube the incentives are really messed up right now so we had content farms which mahalo was definitely not part of but there was like ehow and other people who were doing content farming which was just throw anything on a page get seo link it together grab the ads and if you don't answer the question or if it's incorrect, that's even better because then people click on the ads.

27:15So if it's a frustrating page, what do you do when you land on a frustrating page that's supposedly going to answer your question? You either hit the back key and go back to Google or you click one of the Google or the ads on the page. And so that's what led to the whole Panda update and Google not wanting to link to content sites that were scaling up content. And it killed Mahalo and a bunch of other sites along with it. If it was accurate, what was their issue with that? Their issue was that there were a group of people who had figured out SEO and had to build a large number of content pages and that people would start going direct to those.

27:47And they just didn't want these content networks to take over the top ranks. And so they just said, this is the maximum amount of traffic that can go to each site. And they wouldn't tell you what was going on. So we went from having like, as but one silly example, how to cook salmon, we had the number one result on. And for some period of time, Mahalo just had, you know, like literally 25 ,000 people a day, day in and day out going to that page. So we just started investing more in that page, more in that page than we did how to cook cod. Of course, yeah. We did like little how-to content and then links to the best stuff on the internet.

28:22But they started to consider this like a little bit competitive. And then they started taking from other sites content and then putting it in the one box. So their vision of the world was don't go to these pages. We'll just put the information on the Google search results. So they started getting competitive. And you see that today where Google is competing heads up with a lot of the sites that they used to link to. So you used to get stock quotes, sports scores, recipes, shopping at other websites. Those got built into the Google search results, right? If you ask for a stock price, Google just gives it to you.

28:54If you ask for sports score, it just gives it to you. If you ask for a recipe, it just gives it to you. Or if you're asking like what temperature should medium rare salmon be, it just gives it to you. Yeah. And so, yeah, you know, this is the pollution of the internet is going to be crazy in the coming years. And that's where figuring out if this is in fact AI generated or human generated. And then as long as it's correct, then it doesn't matter. But that's the question I have for you is when do we think we can start trusting the results from AI and in what sectors? It's just the amount of wrong information is the challenge I have right now with fully embracing a lot of Let's do a real-time test.

29:31Okay. It just got generated. This is the one that you asked. How a keystone in an arch works. Yes. Here's the summary. Okay. The keystone is a wedge-shaped stone placed at the top of an arch. It rolls your weight evenly. Let's play it a little bit faster here. Let's play it faster. Here we go. Welcome to this video explaining the importance of the keystone in an arch. An arch is a curved structure that supports weight above an opening, and it has been a crucial architectural element for centuries. Let's first look at an arch without a keystone. The stones in the arch push against each other and rely on friction to stay in place.

30:02It's not an arch. Now let's introduce the keystone. The keystone is the final wedge-shaped stone placed at the top of the arch. When the keystone is inserted, it locks the other stones in place by distributing the weight evenly. The keystone prevents the other stones from sliding outward, providing stability to the arch. That is a bunch of bricks on top of each other. Totally bungled this. I think you didn't get the drawing right, but its concept is correct. Its concept is correct, so proving my point. The keystone is crucial for maintaining the integrity of the arch. It got this completely utterly strong in terms of drawing it.

30:32It got the other parts correct. Yeah. Yeah. I mean, anybody doesn't know if you think of an arch, there's a keystone. That's the middle stone. All the stones lean into that and all the pressure goes into that stone and keeps the arch up. And for those of you who are listening, not watching, this video just showed a stack of squares with a triangle laid in the middle of them. It's exactly the opposite of how it works. So gatekeep.ai, great, but I guess garbage in, garbage out, or good data in, garbage out. It's almost like we have a problem here where you get good information into these LLMs, and then they screw it up.