The State of Generative AI: Vince Hankes, Sarah Guo, & Shardul Shah with Eric Newcomer

Vince Hankes of Thrive Capital, Sarah Guo of Conviction, and Shardul Shah of Index Ventures kicked off the day, deeming it a happy “summertime” in the business, though they did largely agree that the nature of the opportunity is shifting.

“The vast majority of founders should not be working on foundation models,” said Hankes, an investor in OpenAI.

Guo said that open-source models were creating a huge opportunity for entrepreneurs to build on top of them.

“If you look at what Llama and Mistral have done for the ecosystem, it has dramatically changed the environment,” she said, enabling entrepreneurs to work across different layers of the stack without bankrupting themselves. Hankes, though, questioned whether open-source foundation models could ultimately afford the compute, and said he believed that Meta’s Mark Zuckerberg had hinted that Llama might still move to a closed model.

Applications were likely to be quite different from traditional enterprise software offerings, Guo said, pointing to the opportunity for remaking video production as one example. An AI incorporating “everything from the videographer to the staffing to the editing just doesn’t look like the shape of companies from 5-10 years ago,” she said.

Shah said Index had missed out on OpenAI mostly due to “over-thinking” things and trying too hard to predict the future, and noted that some of the big opportunities, like code-generation and document-creation, were among the most obvious. “Almost every week a new company seems to emerge at a very high valuation,” he noted. “It’s an enormous field, there could be multiple winners.”

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