Daily Digest: Half-billion valuations

PLUS: Everyone wants the enterprise cake.

October 25, 2023

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Daily Digest #270

Hello folks, here’s what we have today;

PICKS

  1. Perplexity has raised $50M at a $500M valuation. VC firms IVP is leading the investment. Perplexity already has 15,000 paying users and is generating $3 million in annual recurring revenue.

  2. OpenAI’s corporate sales come under pressure as AI customers eye cheaper options. Some are buying from Microsoft directly, while others go the open-source route.🍿Our Summary (also below)

  3. Lenovo and NVIDIA announce hybrid AI solutions to help enterprises quickly adopt GenAI. They aim to support businesses in deploying tailored generative AI applications across edge, on-premise and cloud environments.🍿Our Summary (also below)

TOP TOOLS

  • Galileo AI - Text to Figma designs. They just opened for private beta. Reply under their tweet with #bensbites to get priority access. (I’m an investor)

  • Custom AI playbooks by Dialpad - Improve adherence to best practices for sales calls.

  • Compass - The first co-pilot for venture.

  • Sync Labs - Sync any video to any audio in any language with an API—no training required.

  • Julius AI - Your AI data analyst is out of beta and generally available. (I’m an investor)

  • Promptchain - Create visual prompt chain with models like Llama2, GPT 3.5/4 and Claude.

WHO’S HIRING IN AI

  • OpenAI - Creating safe AGI for all.

  • Scale - Bring human intelligence to software.

  • Microsoft - Leading the new era of AI.

  • Inworld - Crafting unique stories for NPC interactions.

  • Pinecone - Vector databases for everyone.

  • Coreweave - The GPU cloud.

  • Synthesia - Text to videos in minutes.

  • Adept - A new way to use computers.

NEWS
QUICK BITES

OpenAI is facing increased competition in selling its generative AI to businesses. Some customers are beginning to buy OpenAI’s software through Microsoft because they can bundle the purchase with other products. Others are finding open-source models cheaper for basic tasks.

What is going on here?

OpenAI’s competition in the enterprise market is increasing day-by-day.

What does this mean?

Open AI’s early customers like Salesforce and Wix now use its models less. Salesforce’s Senior VP of AI, Jayesh Govindarajan said “We’re at the very beginning of this cost-reduction exercise in AI.” Salesforce is adding its own models and other open-source models in the mix.

Wix is also trying out Google’s Vertex AI and more Open AI but through Azure. Morgan Stanley, one of OpenAI's flagship customers, also began buying some models via Microsoft Azure recently. That’s a problem for OpenAI, as Microsoft keeps much of the OpenAI-related revenue it generates.

Smaller tools like Summarize.tech are finding open-source models cheaper for basic tasks and switching from OpenAI's GPT-3.5 to Mistral 7B. However, OpenAI is also gaining some new enterprise customers like the mutual fund giant Fidelity Investments, which recently started using Azure OpenAI after being an AWS SageMaker customer.

Why should I care?

More competition means enterprises have options beyond OpenAI now. They can mix and match providers to optimize costs.

Because of their weird partnership, dealing with Microsoft is tricky for OpenAI. OpenAI also has a nascent enterprise sales team compared to Microsoft's established presence.

The bull case for Open AI stands if it proves itself as an enterprise seller and gets more wins like Fidelity under its belt.

QUICK BITES

Lenovo and NVIDIA are expanding their partnership to bring the power of AI to enterprises everywhere through new hybrid solutions and engineering collaboration. They aim to support businesses in deploying tailored generative AI applications across edge, on-premise and cloud environments.

What is going on here?

Lenovo and NVIDIA are providing enterprise businesses with end-to-end hybrid AI systems to quickly adopt Gen AI.

What does this mean?

Lenovo will offer integrated systems optimized for NVIDIA's AI software and hardware. This includes the ThinkSystem server with NVIDIA GPUs and networking, and the ThinkStation workstation supporting multiple NVIDIA GPUs.

Combined with NVIDIA's NeMo framework for customizing large language models and VMware's Private AI Foundation, businesses can build, fine-tune and run generative AI tailored to their data. Lenovo's new AI services arm will also help businesses implement AI, from strategic roadmapping to scaled deployments.

Why should I care?

This partnership enables businesses to adopt generative AI faster, with less risk and more flexibility. You can leverage Lenovo and NVIDIA's tight integration to develop custom models using your data while tapping into enterprise-grade support. Concerns around the security, stability and scalability of AI deployments are addressed. Small teams can also pilot AI thanks to consumption models like TruScale.

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