Since OpenAI released ChatGPT to the masses nearly a year ago , there’s no question the ecosystem exploded. The world screamed out “the ChatGPT moment has just kicked off a new normal,” and the data agrees. Public awareness spiked, enterprise adoption expanded, and Generative AI startups have begun monopolizing VC (40% of total activity in 2023H1 according to Crunchbase). Knowledge workers across all functional areas began iterating on how to augment their capabilities with the help of generative agents. A recent study conducted by Sourcegraph found that 95% of the 1,000 developers polled are using copilots with other functional areas of the enterprise showing similar adoption rates. Given the clear value and nascent funding landscape, technologists began building on top of these foundation models to capture this unprecedented opportunity. However, a fundamental question remained: who will own the ecosystem and how will new entrants build long term value?

Just like the adoption of cloud democratized compute infrastructure, GPT-3 and beyond are democratizing highly performant LLMs. Open and closed-source models have begun surpassing major human performance benchmarks.

Nonetheless, as we spoke about in an earlier newsletter, there was still significant friction to widespread adoption: data security & privacy challenges, training costs, and supply-side risks given the models couldn’t be hosted on internal infrastructure. Fortunately, in March 2023, a 4chan leak of Meta’s LLaMA led to a flood of innovation and experimentation in the open-source realm. The developer community demonstrated that bigger isn’t always better when deploying LLMs, and new fine-tuning techniques could significantly drive down training costs without affecting performance. Early examples include Vicuna and Koala, two models that maintained performance thresholds near their Big Tech competitors with a small fraction of the training costs, $300 and $100 respectively.

Around the same time, OpenAI threw a wrench into the entire startup ecosystem by releasing plugin functionality. Instead of building separate platforms and managing infrastructure, founders could reach the 150M+ ChatGPT community by building plugins. This caused many of the first-movers to re-evaluate their entire strategy. I remember thinking, “is this the app store moment for OpenAI?” While adoption did not quite meet expectations, it was clear OpenAI had another ace up their sleeve.

Fast forward to Monday, November 6th when OpenAI held its first developer day. If you missed it, I encourage you to read about all of the announcements  (recap). The hype around this event felt as big as Apple’s WWDC conference—a strategic move to become “The'' Generative AI Platform. One big highlight was the release of GPT-4 Turbo which comes with increased context length and knowledge cutoff (April 2023), speed and multi-modal optimizations, significant price decreases from previous versions (2-3x cheaper than GPT-4), and more safeguards (copyright shield to prevent IP risks). However, the update everyone is talking about is the release of GPTs and the GPT Store. I’ve captured some of my thoughts on how this release could be the early innings of seismic shift in how developers and knowledge workers interact with and build Generative AI applications:

As we continue to see this ecosystem evolve, we would love to hear your perspective on how the GPT Store will impact the future of Generative AI. If you have any ideas or insights you would like to share, hit up Eric on the community Slack or reach out via email at [email protected] for a feature in our next newsletter!

The last 2 weeks have been busy with a lot of firsts for the community! If you missed it, you should check out our own Thomas Joshi with episode 6 of the Collective Intelligence Community Podcast. We also had our co-lead Matt Huang and our Director of Healthcare Partnerships Mihir Somaiya throw back to back events on the same night—shoutout to SHACK15 for letting us use their awesome space! Our first event with the amazing Raiz Capital team focused on the founders in our community and how to build for the long term. We were also excited to show their Boston-based portcos what The GenAI Collective and the Bay is all about.

The second act of the night was sponsored by Derick En'Wezoh, MD, MBA (representing Susa Ventures) where we threw our first ever healthcare-focused event as The GenAI Collective! We’re proud of the innovators, investors, and community members that came together to tackle some of the most challenging issues in healthcare today with AI at the forefront of more accessible and affordable care.

We have a packed schedule at The GenAI Collective going into holidays, and we look forward to seeing all of you at our next events!

About Eric Fett

Eric joined The GenAI Collective in early September to lead the development of the newsletter. He is currently an investor at NGP Capital where he focuses on Series A/B investments across enterprise AI, cybersecurity, and industrial technology. He’s passionate about working with early-stage visionaries on their quest to create a better future. When not working, you can find him on a soccer field or at a sushi bar! 🍣