Opinion- AI is helping to launch new businesses (and not just AI businesses)
Published: 01:08 PM,Aug 20,2024 | EDITED : 12:08 PM,Aug 21,2024
Sean Ammirati has been teaching a class on entrepreneurship for more than a decade.
A professor at Carnegie Mellon University, Ammirati has groups of mostly graduate students start businesses from scratch over the course of the spring semester. Some of the startups that his 49 students created this year were classic examples of the form: a dating app for couples in long-distance relationships, a personalized fitness app.
But Ammirati also noticed something unusual.
“I have a pretty good sense how fast the progress that students should make in a semester should be,” he said. “In 14 years, I’ve never seen students make the kind of progress that they made this year.” And he knew exactly why that was the case. For the first time, Ammirati had encouraged his students to use generative artificial intelligence as part of their process — “think of generative AI as your co-founder,” he recalled telling them.
The students began sharing their ideas for use cases on a dedicated Slack channel. They used generative AI tools such ChatGPT, GitHub Copilot and FlowiseAI to help them with tasks including marketing, coding, product development and recruitment of early customers.
By the end of the class in May, venture capitalists were descending on Carnegie Mellon’s campus in Pittsburgh.
“It felt to me like what I felt like in the mid-2000s, when cloud and mobile happened at the same time,” said Ammirati, who is himself an entrepreneur. Generative AI, he believed, could similarly change innovation “by an order of magnitude.” For all the excitement over the potential impact of generative AI tools like ChatGPT, it is not yet obvious how or when this technology will begin to measurably affect economic activity. Many businesses, especially smaller businesses, are still trying to figure out how to use it effectively.
Yet for some entrepreneurs, generative AI is already a game changer. It is helping them write intricate code, understand complex legal documents, create posts on social media, edit copy and even answer payroll questions. The result, they say, is that AI allowed them to get their companies off the ground more quickly, and more efficiently, than they would have without it.
The implications could be profound. Startups are a crucial well of job growth and economic resilience. By helping to drive innovation, they also contribute to higher productivity — one of the key promises of generative AI.
The technology “kind of gives you stilts to get through an obstacle — to get through a minefield,” said Steven Bright, who recently started Skittenz, a company that makes colorful coverings for mittens. “You can get from one point to another faster.” Bright said he had the idea for Skittenz in late 2022 during a ski trip with his wife when they noticed that everyone was wearing ordinary black ski gloves. Wouldn’t it be cool, they thought, if you could put a trail map or another colorful skin over your gloves instead? Bright, an emergency room doctor in Golden, Colorado, thought he had a good idea for a business, but he had no idea what to do next. “Most of my colleagues and friends are doctors or in the medical field,” he said. “I didn’t even know where to start with regards to getting help.” So instead, he turned to ChatGPT, which was gaining widespread attention. He initially used the technology to answer basic questions such as how to use a particular kind of dye for the glove skins, eventually asking the tool to handle more complicated tasks including coming up with a survey for customer feedback, translating patent documents into understandable terms and deciphering legal agreements for trade shows.
While the company is not yet profitable, Bright said using ChatGPT gave him the confidence he needed to start Skittenz without having to pay lawyers or other experts. “It’s scary when you’re taking your savings and putting it into a new idea when you have no footing,” he said. “But to be able to harness the whole power of the internet into a bit of a conversation gives you some reassurance.” Little data exists at this point on how many startups are using AI and whether the technology is helping them to get more quickly on the path to hiring and, ideally, profitability. That is partly because the intersection of entrepreneurial activity and generative AI has only recently emerged as an area of study for economists.
But research suggests that newer businesses are, at a minimum, more inclined to experiment with the technology.
According to a working paper published in April by the National Bureau of Economic Research, AI use was higher among young firms. Applications like generative AI may be attractive to young and small firms, the paper’s authors wrote, because they are “general-purpose technologies” that are not expensive to use. — The New York Times
A professor at Carnegie Mellon University, Ammirati has groups of mostly graduate students start businesses from scratch over the course of the spring semester. Some of the startups that his 49 students created this year were classic examples of the form: a dating app for couples in long-distance relationships, a personalized fitness app.
But Ammirati also noticed something unusual.
“I have a pretty good sense how fast the progress that students should make in a semester should be,” he said. “In 14 years, I’ve never seen students make the kind of progress that they made this year.” And he knew exactly why that was the case. For the first time, Ammirati had encouraged his students to use generative artificial intelligence as part of their process — “think of generative AI as your co-founder,” he recalled telling them.
The students began sharing their ideas for use cases on a dedicated Slack channel. They used generative AI tools such ChatGPT, GitHub Copilot and FlowiseAI to help them with tasks including marketing, coding, product development and recruitment of early customers.
By the end of the class in May, venture capitalists were descending on Carnegie Mellon’s campus in Pittsburgh.
“It felt to me like what I felt like in the mid-2000s, when cloud and mobile happened at the same time,” said Ammirati, who is himself an entrepreneur. Generative AI, he believed, could similarly change innovation “by an order of magnitude.” For all the excitement over the potential impact of generative AI tools like ChatGPT, it is not yet obvious how or when this technology will begin to measurably affect economic activity. Many businesses, especially smaller businesses, are still trying to figure out how to use it effectively.
Yet for some entrepreneurs, generative AI is already a game changer. It is helping them write intricate code, understand complex legal documents, create posts on social media, edit copy and even answer payroll questions. The result, they say, is that AI allowed them to get their companies off the ground more quickly, and more efficiently, than they would have without it.
The implications could be profound. Startups are a crucial well of job growth and economic resilience. By helping to drive innovation, they also contribute to higher productivity — one of the key promises of generative AI.
The technology “kind of gives you stilts to get through an obstacle — to get through a minefield,” said Steven Bright, who recently started Skittenz, a company that makes colorful coverings for mittens. “You can get from one point to another faster.” Bright said he had the idea for Skittenz in late 2022 during a ski trip with his wife when they noticed that everyone was wearing ordinary black ski gloves. Wouldn’t it be cool, they thought, if you could put a trail map or another colorful skin over your gloves instead? Bright, an emergency room doctor in Golden, Colorado, thought he had a good idea for a business, but he had no idea what to do next. “Most of my colleagues and friends are doctors or in the medical field,” he said. “I didn’t even know where to start with regards to getting help.” So instead, he turned to ChatGPT, which was gaining widespread attention. He initially used the technology to answer basic questions such as how to use a particular kind of dye for the glove skins, eventually asking the tool to handle more complicated tasks including coming up with a survey for customer feedback, translating patent documents into understandable terms and deciphering legal agreements for trade shows.
While the company is not yet profitable, Bright said using ChatGPT gave him the confidence he needed to start Skittenz without having to pay lawyers or other experts. “It’s scary when you’re taking your savings and putting it into a new idea when you have no footing,” he said. “But to be able to harness the whole power of the internet into a bit of a conversation gives you some reassurance.” Little data exists at this point on how many startups are using AI and whether the technology is helping them to get more quickly on the path to hiring and, ideally, profitability. That is partly because the intersection of entrepreneurial activity and generative AI has only recently emerged as an area of study for economists.
But research suggests that newer businesses are, at a minimum, more inclined to experiment with the technology.
According to a working paper published in April by the National Bureau of Economic Research, AI use was higher among young firms. Applications like generative AI may be attractive to young and small firms, the paper’s authors wrote, because they are “general-purpose technologies” that are not expensive to use. — The New York Times