Gavin Baker

I find these debates also very funny. There have been articles written about multi-hundred billion dollar ROI questions. Those are very strange to me. Why? The biggest spenders on GPUs are public companies and they report financial results every quarter. And you can calculate a metric called return on invested capital.

I find these debates also very funny. There have been articles written about multi-hundred billion dollar ROI questions. Those are very strange to me. Why? The biggest spenders on GPUs are public companies and they report financial results every quarter. And you can calculate a metric called return on invested capital.

And ROIC, ROI, has gone vertical since they ramped their CapEx on GPUs and actually just started to level out in this latest quarter. So the ROI on AI has been very positive thus far. Just a fact. It's a really good question Will it continue, particularly if it's going to cost $100 billion to train a model in two or three years, which I think is a realistic estimate.

And ROIC, ROI, has gone vertical since they ramped their CapEx on GPUs and actually just started to level out in this latest quarter. So the ROI on AI has been very positive thus far. Just a fact. It's a really good question Will it continue, particularly if it's going to cost $100 billion to train a model in two or three years, which I think is a realistic estimate.

Yeah.

Yeah.

Yeah. I mean, I personally have not had good experiences with Copilot, but I would say that, and I'm sure both of you have come across these. There are lots of companies that are just these thin wrappers over a foundation model. And they go from zero to 40 million instantaneously. Yeah. And they're profitable. And for their customers, they're replacing labor budgets. Yes.

Yeah. I mean, I personally have not had good experiences with Copilot, but I would say that, and I'm sure both of you have come across these. There are lots of companies that are just these thin wrappers over a foundation model. And they go from zero to 40 million instantaneously. Yeah. And they're profitable. And for their customers, they're replacing labor budgets. Yes.

I'm sure you guys are noticing this too, but startups today at a given size are employing fewer people than they would have three years ago. And just like, you know, it's funny. People were very skeptical.

I'm sure you guys are noticing this too, but startups today at a given size are employing fewer people than they would have three years ago. And just like, you know, it's funny. People were very skeptical.

Yeah, and that's the ROI on AI. And like, you know, I went to the first AWS reInvent conference and no big companies were using cloud computing. It was all startups. Startups always adopt technologies first. So outside of the ROI on AI that you're seeing in Google and Meta from...

Yeah, and that's the ROI on AI. And like, you know, I went to the first AWS reInvent conference and no big companies were using cloud computing. It was all startups. Startups always adopt technologies first. So outside of the ROI on AI that you're seeing in Google and Meta from...

you know, using this across their businesses, you were seeing real ROI on AI from startups, the same way they saw real ROI from cloud computing before anyone else.

you know, using this across their businesses, you were seeing real ROI on AI from startups, the same way they saw real ROI from cloud computing before anyone else.

But I don't think these companies are in a classic prisoner's dilemma. They all believe to varying degrees that whoever gets there first to artificial super intelligence is going to create tens or hundreds of trillions of dollars of value. And I think they may be right. And if they get there, And they think that if they lose the race, their company is at mortal risk.

But I don't think these companies are in a classic prisoner's dilemma. They all believe to varying degrees that whoever gets there first to artificial super intelligence is going to create tens or hundreds of trillions of dollars of value. And I think they may be right. And if they get there, And they think that if they lose the race, their company is at mortal risk.

So as long as one person is spending, I think they will all spend, even if the ROI decelerates. It is a classic prisoner's dilemma.

So as long as one person is spending, I think they will all spend, even if the ROI decelerates. It is a classic prisoner's dilemma.

Well, first of all, it's a tragedy. And actually, I'm in New York as we record this, and it happened one block from where I am. And I mean, it is absolutely, it's a human tragedy. Taylor Lorenz was not the only person on social media who reacted that way, which I thought was deeply troubling.

Well, first of all, it's a tragedy. And actually, I'm in New York as we record this, and it happened one block from where I am. And I mean, it is absolutely, it's a human tragedy. Taylor Lorenz was not the only person on social media who reacted that way, which I thought was deeply troubling.