99% of AI companies are not going to work out: Elad Gil on what to build in AI
Elad Gil is a prominent entrepreneur, investor, and advisor in the technology industry, known for his keen insights and successful ventures. He co-founded Mixer Labs, which was acquired by Twitter, where he then served as a Vice President.
As an angel investor, Elad has backed several high-profile companies, including Airbnb, Stripe, and Square. His extensive experience and strategic vision have made him a sought-after advisor for many of Silicon Valley’s leading startups, solidifying his reputation as a key figure in the tech ecosystem.
In a conversation with Dave Morin and others, Elad Gil goes deeper into the current state and future potential of AI, highlighting investment strategies, enterprise adoption, and the transformative impact of AI across various industries.
A must read for those who are building in AI and are trying to understand the changing landscape.
Big Ideas from the hour-long conversation (video embedded in the end*)
Widespread AI Adoption
AI adoption is happening at multiple levels, with significant advancements in both consumer and enterprise applications. While only a small percentage of AI startups will succeed, those that do could have a massive impact.
“99% of AI companies are not going to work out, but the 1% that will could be quite large.”
Revenue Growth in AI
Major cloud providers like Azure are seeing significant revenue growth attributed to AI services.
This trend underscores the commercial viability of AI technologies and their increasing integration into enterprise solutions, even as full-scale adoption is still on the horizon.
“Azure announced a $25 billion quarter of which 5% lift came from AI, adding a billion and a half per quarter in new revenue.”
Sometimes the best thing you can do is just kind of quit and restart and go do something different. As a founder if you’re able to go and start a company those are probably the best most productive years of your life in terms of ability to take risk and therefore if the thing isn’t working, move quickly on to the next thing — Elad Gil
“You suddenly have this blossoming of hundreds or thousands of companies all doing a giant search function in parallel.”
The Role of Incumbents in AI Adoption
Large incumbent companies, particularly in the tech sector, may have a significant advantage in AI adoption due to their existing customer base, data resources, and distribution channels.
This could allow them to implement AI solutions more effectively and at a larger scale than startups, even if they enter the market later. However, this also raises questions about the potential for true disruption and the opportunities available for new entrants in the AI space.
Read more such big ideas on NextBigWhat.com, where we bring you all the key ideas, commentaries and opinions on things that matter — right from AI to mental health.
