Quick observations from Sam Altman’s opening keynote of OpenAI DevDay:

1/ Amazing GPT-4/ Turbo upgrades and new features announced. In particular, loved the ability to upload docs into ChatGPT. Also, the ability to choose pre-programmed voice modalities that sound significantly more realistic than any current digital alternatives.

Was also awesome to see Coke’s campaign that lets its customers programmatically create Diwali cards using DALL.E 3.

2/ The icing on the cake was the introduction of ‘GPTs’ or agents. Users can now build AI agents within ChatGPT that absorb a set of instructions and then take specific actions while leveraging the GPT-4 expanded knowledge base.

3/ Building GPT agents in natural language is the democratizing aspect of Generative AI and something that was missing in the earlier voice-to-action apps/ personal assistants in the mobile paradigm.

Sam’s natural language demo reminds me of all the bottlenecks we faced while building first-generation mobile search/ deep-linking at Quixey + all the work my friend, the late Rajat Mukherjee, did on voice-to-actions at Aiqudo. AI is on track to solve all those engg./ product challenges.

4/ OpenAI also showcased the GPT Store, which will feature the best GPTs built by developers on a revenue share model. This AI app store is a natural extension of the democratized-agent strategy.

5/ The developer Playground demo was really interesting, demonstrating capabilities like threading, function calling etc.

Essentially, any developer can now build agents within their app for their customers. These agents can have all advanced GPT-4 capabilities that power specific use cases like trip planning, navigation, splitting expenses etc., each of which is presently done by separate siloed apps.

Was awesome to see the demo agent communicate in a Jarvis-like voice modality.

6/ Finally, stoked to see the love Satya Nadella showed OpenAI and Sam during a friendly on-stage banter.

It looks like the OpenAI partnership has given a new lease of life to Azure and maybe even a game-changing competitive advantage against other cloud providers. In parallel to all the work that OpenAI is doing on the model side, Azure is building a new end-to-end, AI-native cloud infrastructure and compute stack to support the development and GTM of these efforts.

It was also heartening to see Satya underline security as one of the core focus areas for the partnership:

We are grounded in the fact that safety matters. Safety is not something you care about later but it’s something we do shift-left on.

Satya Nadella at OpenAI DevDay

My TLDR take:

The rollouts in this first-ever DevDay by OpenAI are clearly important milestones in this rapidly evolving space. AI is becoming easier to use, more powerful, and more accessible at an exponential pace. Personally, this is the first time I am seeing a potential v0.1 of what has been a larger-than-life but fuzzy vision of AGI.

Kudos to Satya and Microsoft for what’s turning out to be a generational business bet on OpenAI that frankly, seems to have caught the other Big Techs a bit flat-footed. However, expect strong responses from Google, Meta, and AWS in the coming months.

Finally, I have met many founders over the last few months who have been building nifty micro-products on top of OpenAI. A few of them have been touting how these are large, venture-returns opportunities. This DevDay has already shown how many of these startup ideas have already become point features within the OpenAI ecosystem.

This aggressive feature rollout by OpenAI once again brings to the fore strategic questions around moats, right-to-win, feature vs product vs platform, and access to 1st party training data. All this is significant food for thought both for founders and VCs.

As Big Tech, OpenAI, and other hyper-scalers like Anthropic continue to dominate the infra and model layers, for new startups, things like sharp domain expertise, deep understanding of specific customer problems, access to proprietary 1st party data as well as industry or audience-specific distribution channels, can become important sources of sustainable competitive advantage and drive a valid case for why a startup should exist.

Note: for more analysis on AI incumbents vs startups, check out ‘AI Musings #1 – How The Odds Are Stacking up?‘.

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