Contrarian Angel: 2023 startup investing rundown and 2024 sector outlook
waxorchard.substack.com
Welcome to 2024! Things are looking up after a challenging investment year. LLMs: Back in my June post, I expressed skepticism about LLM hype. I have even higher conviction now that there’s a bubble here. Angel investors jumping into secondary offerings for Open AI and Anthropic at premiums to the last priced round may be taking more of a risk than they realize. The technical moat appears to be smaller than initially thought, as the costs for training and inference drop rapidly AND researchers figure out how to optimize for particular use cases with models an order of magnitude smaller than GPT-4. On top of that, for the Open AIs of the world, there are still copyright risks, governance risks, and partnerships with Big Tech that will see those incumbents capture a significant portion of value.
Contrarian Angel: 2023 startup investing rundown and 2024 sector outlook
Contrarian Angel: 2023 startup investing…
Contrarian Angel: 2023 startup investing rundown and 2024 sector outlook
Welcome to 2024! Things are looking up after a challenging investment year. LLMs: Back in my June post, I expressed skepticism about LLM hype. I have even higher conviction now that there’s a bubble here. Angel investors jumping into secondary offerings for Open AI and Anthropic at premiums to the last priced round may be taking more of a risk than they realize. The technical moat appears to be smaller than initially thought, as the costs for training and inference drop rapidly AND researchers figure out how to optimize for particular use cases with models an order of magnitude smaller than GPT-4. On top of that, for the Open AIs of the world, there are still copyright risks, governance risks, and partnerships with Big Tech that will see those incumbents capture a significant portion of value.