Over the last year, we’ve met with dozens of startup founders and operators in large companies who deal directly with generative AI. We’ve observed that infrastructure vendors are likely the biggest winners in this market so far, capturing the majority of dollars flowing through the stack. Application companies are growing topline revenues very quickly but often struggle with retention, product differentiation, and gross margins. And most model providers, though responsible for the very existence of this market, haven’t yet achieved large commercial scale.
In other words, the companies creating the most value — i.e. training generative AI models and applying them in new apps — haven’t captured most of it
Would love to learn how a16z measures who is 'creating the most value.' My guess? Vibes and a conflation of "customer facing" and "value creation."
And I would disagree - the chipmakers have produced most of the value and are reaping massive rewards right now. Certainly, the new LLM wrappers are not the value creators.
https://a16z.com/2023/01/19/who-owns-the-generative-ai-platf...
Over the last year, we’ve met with dozens of startup founders and operators in large companies who deal directly with generative AI. We’ve observed that infrastructure vendors are likely the biggest winners in this market so far, capturing the majority of dollars flowing through the stack. Application companies are growing topline revenues very quickly but often struggle with retention, product differentiation, and gross margins. And most model providers, though responsible for the very existence of this market, haven’t yet achieved large commercial scale.
In other words, the companies creating the most value — i.e. training generative AI models and applying them in new apps — haven’t captured most of it