Artificial Intelligence: 5 Ideas for Entrepreneurs to Consider as They Build Great Companies
At Rev1 Ventures, I lead a team that focuses on applying market intelligence and analytics to accelerate Rev1’s growth strategy. We are responsible for the integrity of Rev1’s internal data and we perform analyses to drive business insights and strategic guidance to our venture advisors and their client companies.
As observers, we are excited and curious about the recent advances of artificial intelligence available more broadly to the public. As researchers and analysts, the capability and efficiency that AI can bring to a business function like ours is thrilling. The same is true for the entrepreneurs and companies we serve.
AI is definitely having its day in the sun. Our team looks at scores of diverse sources of articles and reports every day, and AI has been a dominant topic for quite some time.
We recently created an analysis of the opportunities and challenges that artificial intelligence presents. Kirsten Haller, Market Intelligence Analyst, took a deep dive into today’s AI.
“AI-based tools can be game changers for efficiency and optimization, especially for startups or smaller and growing businesses,” said Haller, “but with the rapid pace AI technology is growing and some of the inherent vulnerabilities associated, security, privacy, and accuracy should be priorities when evaluating solutions.”
Here are five ideas about AI that entrepreneurs and new companies should be considering now.
1. Artificial intelligence is everywhere. While the concept of artificial intelligence has been around about seventy years in some capacity, technology and cost held AI back from wide, public adoption. Over the last 15 years or so, as hardware and software advanced at a rapid pace, data storage became exponentially cheaper, and more complex decisioning models were created, we began to hear and see more. Chatbots, language translation, product recommendations, and predictive text have all become a part of our everyday lives.
Alphabet · Amazon · Apple · Microsoft · Facebook · IBM · Instagram · Netflix · OpenAI
So, what’s new? Now we have publicly available generative AI tools like ChatGPT, Bard, DALL-E, and GitHub Copilot. It seems like once one generative AI tool went live, they all rushed to market. The capability to create content that’s never existed has spurred excitement and imagination. Startups and entrepreneurs now have access to tools and capabilities that they haven’t previously had; how will they leverage them?
2. The opportunity to create is breathtaking. AI is a hugely disruptive technology, and disruptive technologies create opportunities. We are collaborating with entrepreneurs who started with solutions penciled on the proverbial “napkin” that they can now begin to prototype using AI. Their products can be trained on large datasets to make decisions accurately and quickly, complete activities, or troubleshoot problems. We’re seeing unique uses of AI in enterprise software, life sciences, and many other industries.
3. Potential to ride on the rails of others. Most companies aren’t going to build their own ChatGPT or Bard. From IBM’s Watson to today, it’s taken the industry giants decades and billions to get to this point. Foundation models like these large language models a lot of computing power, storage, and expertise. It is highly unlikely that entrepreneurs or corporates will invest in building their own generative AI platforms or languages at this level of complexity. But with the increasing public availability of these AI tools, maybe they don’t have to.
4. The highway may be “free,” but the entrance ramps sometimes cost. There are considerations when you build your company on an open-source platform. The future is foggy, especially this early in the game. What if the price or access changes? Or the model goes away? We’ve already seen different iterations of AI models perform and react differently as they evolve. For entrepreneurs, this is a whole new area for risk mitigation and due diligence.
If your business or solution depends on intellectual property that you don’t own, you have to scenario plan how to survive without it. If ever entrepreneurs need to peer around corners to anticipate negative outcomes, it’s with AI. Prepare for the risks of AI just like you would for other risks you can’t control—a downturn in the economy or a natural disaster, or a pandemic.
5. AI is an amazing tool, but it is not a flawless tool. There is cause for excitement and cause for caution. Applying AI to proprietary data sets—data you own and control—to identify trends and patterns is one thing. Publicly available generative AI models and techniques which strive to look at data from virtually everywhere and create new data are something entirely different.
There are data leaks even with large, established companies, but the unique problem with AI systems, especially generative AI, is that they can consume large sets of data and that can often mean information from users.
“Now you’re seeing data vulnerability on two fronts: your stored data being accessed and the system potentially training itself using the information you’re entering,” said Haller. “That’s why understanding how AI tools use your data is the best way to protect your proprietary information. Be wary of free products. Always read privacy policies. As a general rule of thumb, if you wouldn’t feel comfortable putting it on social media then you shouldn’t feel comfortable uploading that information to generative AI.”
There is also a lack of transparency with AI. Where does the data come from and what does the learning model look like? As an example, it’s difficult to verify how ChatGPT reaches a conclusion. Copyright infringements, “hallucinations” and false answers, and “deep fakes” are real exposures. Power is concentrated in those who control these foundational models.
AI can be a powerful tool to make our jobs and lives easier and more efficient, but it needs to be treated responsibly.
Promising, yes. Complex considerations of ethics and accuracy? Definitely. Startups must start now to understand the opportunities and challenges of AI and begin to develop responsible use policies. Entrepreneurs leveraging AI as a key component of their business should strive to ensure that they’re more likely to be a success story than a cautionary tale.