NFX’s Post

Name: AI Is Like Water
Uploaded: 2024-05-15T00:19:28.685Z
Duration: 3 min 34 s
Channel: NFX
Description: AI is like water. And if people could create an entirely new industry with bottled water, we can do it with the biggest tech breakthrough in the last 14 years. Watch Morgan Beller's latest video essay on recognizing when technology no longer sets you apart and how to shift focus to new areas of differentiation. #StartupStrategy #Innovation #Founders #AI

NFX

26,223 followers

7mo

AI is like water. And if people could create an entirely new industry with bottled water, we can do it with the biggest tech breakthrough in the last 14 years. Watch Morgan Beller's latest video essay on recognizing when technology no longer sets you apart and how to shift focus to new areas of differentiation. #StartupStrategy #Innovation #Founders #AI

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(dramatic music) - [Morgan] Water is three things: necessary, ubiquitous, and the same damn thing inside every damn bottle. AI is just like water, and we'll tell you why. (dramatic music) For a long time, tech has been a differentiator for software startups. We thought that if you could build something no one else could, that could protect you. Definitely not forever, but at least for a while. But AI provides you with basically no protection from the start. Tech differentiation in AI is mostly a shrinking moat. It's more important than ever to develop a key insight about how you will be creating value for your end users in a way that no one else can. If people could do it by branding bottled water, then we can do it with the biggest tech breakthrough in at least 14 years. (dramatic music) There are very few ways right now for AI companies to differentiate under the hood, and yet they run this formula for their company and expect it to work. That won't get you very far. The formula your AI company actually needs has these multipliers. Data isn't enough on its own. As for models, most will be interchangeable. So what's left? Well, UX for starters. In crypto, I used to say that the user experience was like eating glass. No one really figured out a seamless way to bring that tech to a big enough hoard of people. The same is true right now for AI where somewhere someone is going to come up with a way to use AI that will blow our minds, and it will be weird at first. In terms of distribution, incumbents have a built-in advantage. The real question is how do you personalize your AI with your user's data? You're essentially lining up to race against an incumbent who is already miles ahead. So what does this all have to do with water? Well, there's a lot that the bottled water industry can teach us about AI applications. 90% of the tap water in the United States is safe to drink, but bottled water is the number one selling beverage in the US. This leaves us with approximately 80 brands of bottled water in the United States, and every bottle of water contains pretty much the same thing. That's because someone took something as ubiquitous as water and made it into an industry. I would argue that company was Perrier. In the 1850s, there were a few regional bottled water companies, mostly based around natural springs. These early entrepreneurs focused on the health benefits when the American public water systems were in development. Most bottled water sold in the US at that time was in gallon jugs for office water coolers. But just then, Perrier, a languishing French brand, decided to go up market. It was sold as a mixer for alcoholic drinks until they began presenting it as a sexy brand by running commercials of a fresher, purer alternative to tap water. What does this mean for founders? It shows us a way forward, but you have to be insanely memorable, original, and clever. You have to be the kind of person who thinks about making a sexy water commercial before anyone else does. Perrier sales jumped from $3 million in 1975 to $200 million in 1979. The bottled water industry was dead. It was revived with smart marketing and niche placement. The incumbents came in and crushed much of the competition and acquired the real standouts. But if you look around again, there are still new bottled water companies popping up following the same pattern. More and more are coming to the table with unique stories and value propositions like Perrier did in the 1970s. The branding is just getting weirder. They're counter positioning. They're putting water in cans, and selling it like energy drinks. You can either guarantee a loss and not play the brand and marketing game or you can give yourself a small chance of success by playing the game and seeking other avenues to build your advantage. (dramatic music) You have to play this game if you even want to be in the conversation. (dramatic music)

Dinesh Babu Sundaram

7mo

I can recall and like to share Mr.Reid Hoffman quote here.. "An entrepreneur is someone who will jump off a cliff and assemble an airplane on the way down." To my fellow founders/ Entrepreneurs - I know, the recent unveiling of ChatGPT 4o and Gemini 1.5 has left many of us in the tech world, feeling a mix of awe and apprehension. While it's natural to feel a bit overwhelmed by the rapid pace of innovation, it's important to remember that we're all in this together. In this AI race, adaptability and resourcefulness are indeed essential for differentiation. Just pat on your shoulder & stay in the game.

(M1) Danny Ng

Affordable Humanoid Robot | CEO(Chief Efficiency Officer)

7mo

Somebody should think about bring down the cost and size of robots for home. with AI, robot will be much smarter and a new appliance in our home. Hopefully someday will co-exist with human and human will never want to do the labor work again at home.

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NFX

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AI is like water. And if people could create an entirely new industry with bottled water, we can do it with the biggest tech breakthrough in the last 14 years. Watch Morgan Beller's latest video essay on recognizing when technology no longer sets you apart and how to shift focus to new areas of differentiation. #StartupStrategy #Innovation #Founders #AI

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NFX’s Post

AI Is Like Water

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AI Is Like Water

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