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Why so many AI startups will die š
š° AI's impact on the startup landscape, A new Beatles song (with help from AI), Pika Labs AI video tool review, and more
Everyday AI
November 02, 2023
Outsmart The Future
Today in Everyday AI
7 minute read
š Daily Podcast Episode: Yeah we said it. A ton of AI startups are going to die. Itās the harsh truth and weāll tell you why. Give it a listen.
šµļøāāļø Fresh Finds: Building 3D stories and videos, Microsoft shuts down its AI polls, and Scarlett Johansson sues AI app. Read on for Fresh Finds.
š Byte Sized Daily AI News: UK invests $273 million in AI supercomputer, Midjourneyās new style tuner, and LinkedIn adds more AI tools. For that and more, read on for Byte Sized News.
š AI In 5: Thereās an amazingly powerful FREE AI video tool that youāve never heard of! Itās called Pika Labs and weāre giving you the breakdown on it! See it here
š§ Learn & Leveraging AI: Maybe youāre a startup (AI or not) and are worried about how you can compete with the AI wave. Letās break down what you can do about it. Keep reading for that!
ā©ļø Donāt miss out: Did you miss our last newsletter? We talked about the future of ChatGPT and its impact, Microsoft 365 Copilot was released, and a DALL-E 3 hack inside ChatGPT. Check it here!
Why so many AI startups will die š°
You read that right.
So many AI startups are going to run out of money, fail, and ultimately die.
We know. That's a harsh take but it's the unfortunate truth.
So whatās the cause of all these AI startups dying?
That's what we're discussing today along with the future of startups and how they're impacted by AI.
Join the conversation and ask Jordan any questions about AI startups.
Also on the pod today:
ā¢ Reasons startups fail š¬
ā¢ Explosive growth in AI startups š„
ā¢ Why ChatGPT will take over š¤
Itāll be worth your 38 minutes:
Listen on our site:
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Listen on:
Upcoming Everyday AI Livestreams
Friday, November 3rd at 7:30 am CST ā¬ļø
Hereās our favorite AI finds from across the web:
New AI Tool Spotlight ā BeforeSunset is an AI-powered workspace for teams to plan & execute, Artwork Flow is your AI-led sidekick to manage all things creative, and Avataar is an AI powered platform to build 3D stories and videos.
AI in Music ā The Beatles are releasing a new song. Kind of. With some help from AI, The Beatles are coming out with a new song for the first time 45 years.
Trending in AI ā The UN has hired an AI company to create realistic virtual simulations of the Israeli-Palestinian crisis so they can train and learn from it.
Big Tech - Yesterday we reported how Microsoftās AI generated a distasteful poll about a womanās death. Today Microsoft has shut down its AI polls.
AI in Society ā At the AI Safety Summit, China, US, and EU have all agreed to work together.
Pop Culture ā Actress Scarlett Johansson is suing an AI app for cloning her voice in an ad.
1. UK's Isambard-AI: A Supercomputing Powerhouse š¬š§
The UK government is investing a whopping $273 million in Isambard-AI, set to be their most powerful supercomputer yet. Powered by 5,448 of Nvidia's GH200 Grace Hopper superchips, Isambard-AI will deliver an astounding 21 exaflops of AI performance. Hewlett Packard Enterprise is constructing this behemoth, which will be hosted by the University of Bristol and operational by summer 2024.
2. Midjourney's "Style Tuner" Unlocks Custom AI Artistry šØ
Midjourney has rolled out a game-changing feature called "Style Tuner," empowering users to craft their own unique styles and apply them consistently to new AI-generated images. This innovative tool adjusts various elements like colors and character details, offering a personalized touch to each creation. Users can now type "/tune" followed by a prompt, select the number of base styles, and upon completion, they're presented with a custom web page to curate their personalized style.
3. Biden's Push for Ethical AI in Government Algorithms šŗšø
President Joe Biden is advocating for the ethical use of AI in government, with new draft rules requiring federal agencies to evaluate and monitor algorithms for potential discrimination or harm. The White House's initiative aims to ensure AI systems in health care, law enforcement, and housing align with human rights standards. Agencies must assess existing algorithms by August 2024 and discontinue any non-compliant ones.
4. LinkedIn Passes 1B Members, Enhances AI for Job Seekers š
LinkedIn has hit a monumental milestone of 1 billion members. In celebration, the platform is introducing advanced AI features for its premium users. These new tools are designed to streamline job searches and enhance user experience, leveraging the power of AI to match professionals with their ideal opportunities.
5. Stable Diffusionās Leap into 3D and Fine-Tuning šØ
Stability AI has announced significant enhancements to its Stable Diffusion platform, venturing into 3D content creation and introducing advanced image fine-tuning capabilities. The highlight is the new Stable 3D model, which extends Stable Diffusion's prowess from 2D to 3D, aiding in graphic design and even video game development. Alongside, the Sky Replacer tool automates background changes, and Stable Fine-Tuning accelerates image refinement for specific use cases.
Pika Labs AI Video Tool Review! š„
Thereās an amazingly powerful FREE AI video tool that youāve never heard of!
If youāre looking for a free and easy AI video generation tool, Pika Labs is the one.
Weāre showing you Pika Labs and how to use it!
Check out today's AI in 5.
š¤·āāļø Whatās Going On and Why It Matters:
š„ Hot takes incoming š„ ā so many āAI startupsā are gonna die soon.
Why?
Theyāre half-baked āsolutionsā searching far and wide for a problem. And as the giants of the GenAI movement (OpenAI, Microsoft, Google, etc.) make small updates to their products, it can take out hundreds of AI-infused startups in one swoop.
Like, do we really need an AI-powered toilet paper holder that uses ChatGPT to give you witty warnings when youāre running low?
Probably not.
Or do we need (literally) hundreds of GPT-powered āwriting toolsā that offer little value?
Absolutely not.
The growing popularity of Generative AI, coupled with how easy it is to build off of systems like OpenAIās API, means weāve been flooded with thousands of unneeded softwares, startups and even hardware products promising to GenAI the heck out of everything we touch.
(Waitā¦ do we need that AI-powered toilet paper holder?)
In todayās show, our host Jordan warned against the gold rush toward startups going all-in on products that offer little value. In other words, thereās hundreds of software startups that are little more than a thin layer of wrapping paper around someone elseās tech.
And most of them are gonna fall. (Sorry, yāall.)
If youāre at all interested in the AI-powered startup space, or maybe youāre an investor looking to make a quick buck in one of these companies, then todayās show is for you.
Go sound off and let us know what you think, but hereās the high-level overview of todayās rant-filled episode detailing why so many AI startups will fail:
Slowing down of innovation as startups copy successful models
Expectation of many AI startups failing in the near future
Focus on offering unique products, not just features
Dependence on someone else's technology and adding features to create a product
High failure rate of AI startups (nine out of ten within the first five years)
Got your attention?
Good.
Letās dive in and talk about what you should do (and shouldnāt do!) to avoid going down this path. š
š¦¾How You Can Leverage:
Take our advice and keep your startup (or company!) alive.
Simple as that.
Whether youāre a startup founder, work in venture capital, or just use multiple GenAI softwares in your workflow, todayās show is important to pay attention to.
And let us know what thoughts or questions you have.
Ready for the tl;dr version of everything thatās wrong in the startup space right now?
Thereās too many AI startups out there and too much VC money powering them.
Very few of these startups offer truly unique value, and instead rely on big companyās APIs as the backbone of their offering.
Small updates from big tech will make hundreds of āAI startupsā useless overnight.
So, letās talk about what to do to avoid this pitfall, regardless of the type of horse you have in the race.
1 ā Eggs in many baskets šŖŗļø
This takeaway goes out other than non-AI startups, but rather those companies using them. Itās simple ā donāt put all of your eggs in one basket. Weāve seen too many businesses go all-in on a certain piece of software and make it an integral part of their workflow.
Donāt do that shorties, especially if youāre talking about a company thatās less than 2 years old. That piece of software could be gone (or obsolete) tomorrow, so spread your eggs in multiple baskets. (Or, just the really big baskets.)
Try this:
Thereās no one-size-fits-all here. Regardless, you should be putting in due diligence before putting too much of your companyās success into any one AI-powered software or service. Hereās a great guide from cloudsmiths to get you started on how to pick the right AI software for your business.
2 ā Differentiate yourself š
For startups and those investing in them, do us all a favor yāall.
(And maybe this is a personal gripe from getting dozens of requests from āstartup foundersā who wanna come on the Everyday AI show, and peddle their kinda crappy products to our loyal audience.)
Make something uniquely better about your software or service. It takes little more than a few hours to create a basic startup in the GenAI space. Take the time to look at the other 893 recent startups who are the exact same as you, and worry about your uniquely better.
What makes you uniquely better?
If you canāt answer that, you donāt have a startup. You have an idea and a shiny website.
Try this:
We donāt need to keep lecturing you here, as our former guest Xiaochen Zhang already laid out the blueprint on how startups can adapt to AI innovation. (Straight gold in that episode from a Go-To-Market leader.)
3 ā Make Plan B your best plan āØ
This goes out to all you startup founders and investors ā take this advice. What happens when Microsoft 365 Copilot erases what you thought was your competitive advantage? Or when platform updates to ChatGPT makes your product useless?
The advice here is simple ā your Plan B has to be at times stronger than your leader Plan A feature. As an example, letās say you built a thriving software business off of allowing your customers to upload PDFs and have conversations with them.
Welpā¦ the last 3 days have brought updates from ChatGPT and Microsoft 365 Copilot that now allow that feature.
So, whatās your Plan B?
Try this:
Oh, whatās that? We already laid out this path for you 3 months ago? Go check out this 1-2-3 guide on how to build more well-rounded products that arenāt too reliant on a single GenAI connection.
Now This ā¦
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