The opportunities generative AI affords startups by Tomasz Tunguz of Theory Ventures, presented to the Saastr Weekly Workshops.

1. Theory Ventures
AI & Startups
AI & Startups

2. Theory Ventures
Why Does AI Matter?
Why Does AI Matter?
Innovation Contribution to GDP
Personal Computer 0.006%
Machine Learning 1.5 - 2.9 %

3. Theory Ventures

4. Theory Ventures
Questions to
Questions to
Answer for
Answer for
Startups
Startups
1. Layer
1. Layer
2. Market
2. Market
3. Moat
3. Moat
4. AI
4. AI
Depth
Depth

5. Theory Ventures
Layers
Layers

6. Theory Ventures
Application
Application
Platform
Platform
Infrastructure
Infrastructure

7. Theory Ventures
Which Layer Accrues More Value?
Which Layer Accrues More Value?
About the same
About the same
Company
Market Cap,
$t
Company
Count
AWS + Azure + GCP 2.1t 3
Top 100 Public Cloud
Companies
2.2t 100

8. Theory Ventures
Application Layer
Application Layer

9. Theory Ventures
Players
Players Approach Examples
Content
Creation
Jasper (text), Gamma
(presentations),
Synthesia
(learning), Craiyon
(design), AIDungeon
(gaming)
Copilots Github (coding),
Harvey (legal), Lilt
(translation)
Agents next-gen RPA

10. Theory Ventures
Platform
Platform

11. Theory Ventures
Developer
Developer
Tool / API
Tool / API
Managed
Managed
Enterprise
Enterprise
Service
Service

12. Theory Ventures
Infrastructure
Infrastructure
Layer Opportunity
Chaining Stitch models together
Tuning / Prompt
Engineering
Solicit better responses
Training Cost Reduction From millions to pennies
Foundational Model New capabilities through scale
Chips New computation & networking for
training

13. Theory Ventures
2. Market
2. Market

14. Theory Ventures
Is Gen AI Enough to
Is Gen AI Enough to
Unseat an
Unseat an
Incumbent?
Incumbent?
Startups have negative time to launch
Startups have negative time to launch

15. Theory Ventures
3. Moats
3. Moats

16. Theory Ventures
My Model is Better
My Model is Better
than Yours
than Yours

17. Theory Ventures

18. Theory Ventures
True for Public &
True for Public &
Private Data
Private Data

19. Theory Ventures
Enterprise
Enterprise
Readiness
Readiness

20. Theory Ventures
Buyer Concerns
Buyer Concerns Copyright
Copyright
Privacy
Privacy
Compliance
Compliance
Security
Security

21. Theory Ventures
Execution
Execution

22. Theory Ventures
Innovation =
Innovation =
Invention +
Invention +
Distribution
Distribution

23. Theory Ventures
4. Technical
4. Technical
Depth
Depth

24. Theory Ventures
How deep will
How deep will
you go?
you go? Plug-in
Plug-in
Tune
Tune
Prompts
Prompts
Bespoke
Bespoke
Model
Model

25. Theory Ventures

26. Theory Ventures
Questions to
Questions to
Answer for
Answer for
Startups
Startups
1. Layer
1. Layer
2. Market
2. Market
3. Moat
3. Moat
4. AI
4. AI
Depth
Depth

27. Theory Ventures

28. Theory Ventures
Tomasz Tunguz
Tomasz Tunguz
!.tomtunguz.com
!.tomtunguz.com
@ttunguz
@ttunguz
Theory
Theory
Ventures
Ventures
!.theory.ventures
!.theory.ventures
@theoryvc
@theoryvc

29. Theory Ventures
Prompts for Images
Prompts for Images
Slide Prompt
1 Robots on a launchpad helping to build rockets with tools
4 An enormous multilayer cake on a huge plate.
8 A hyper realistic computer with a futuristic mouse, keyboard & monitor
10 An oil rig floating in a bright blue sky japanese anime
13 David & Goliath in the style of Banksy
15 A young boy in a leather jacket jumping over a rocky moat cartoon
16 Two computers with code on their screens facing each other on fire rendering
19 A gleaming skyscraper reaching up in to the sky cyberpunk
21 A robot working on a rocket in a laboratory cartoon
23 A photograph of a collection of electrical outlets
25 Two robots working together on a rocket launchpad cartoon
27 A hand drawn drawing of men & women in a foot race