LLM Gold Rush

Large language AI model (LLM) seems to be at an inflection point. Popularized by ChatGPT, the barrier to entry to this technology has lowered to near-zero. Any developer can plug into the API to build wonderful products on top of it.

A parallel moment in the past was when the iPhone was launched alongside the iOS app development tool suite. Developers with somewhat cursory training were able to build powerful mobile apps. And we saw the birth of AirBNB, Uber, Spotify, Facebook, etc.

What will happen next is a gold rush of new AI powered products, every niche will have 5+ teams building products for it. Most of them will fail, but a few of them will find high value product market fit, with defensible market positions, and become huge tech companies.

The large tech companies today will not invest in these products. A faithful tech market coincidence is taking place where companies are being extremely conservative in their investments. The big techs are playing defense, they are not taking the wild swings, fallen victim to the innovator’s dilemma.