Google Ventures managing partner told Fortune that the challenge for investors when it comes to generative AI will be deciding the best place to invest.
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00:00I guess the biggest difference in the foundation model is the speed of commoditization and reduction of cost.
00:05So if you look at the per token price, because of DeepSeq and other open source models, it's actually decreased 1,200x in the last two years.
00:15So the cost of running large language models and diffusion models is collapsing.
00:20So that's the first observation.
00:22We think that's important because actually sort of generative AI might become a utility.
00:26But the challenge for investors is where do you invest with a sort of long-term moat?
00:31And so the good news, as Alex said, is we're seeing the application layer really starting to grow.
00:36I mean, some of the fastest growing companies in our portfolio globally are in the application layer.
00:42So the places where large language models are reliable enough today are the sort of front end of adoption.
00:49So we have a business like Synthesia in London we invested in where the videos are good enough today.
00:54They're over 100 million ARR.
00:56Or we have businesses like Harvey in Legal Tech where it's good enough today.
01:01They're doing another round at the moment.
01:03Both of whom will be here.
01:04Great.
01:05And another one is in coding, obviously, one of these areas where it's sufficient.
01:10You know, it works today.
01:11You've seen the rate of growth of cursor.
01:13That current round is absolutely extraordinary to see.
01:17And we have businesses like Bolt.new, StatBlitz, that went from zero revenue up to 40 in 12 weeks because actually they're superpowering users like never before.
01:28So that bleeding edge of applications, as Alex said, we're seeing faster growing businesses than I think we've ever seen before.
01:36We'll see you next time.