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I'm _extremely_ surprised to see all of the YC companies that are essentially just layers on OpenAI. I think it's safe to assume more models will be introduced

I'm _extremely_ surprised to see all of the YC companies that are essentially just layers on OpenAI. I think it's safe to assume more models will be introduced and vendor lock-in can be avoided, but I find it hard to believe some of the "simpler" ideas can create compelling, VC-scale businesses.

anon291 4y ago
Why are you surprised? OpenAI is Sam Altman's (YC's last leader) pet project. Of course, YC is highly incentivized to produce more customers for OpenAI
- iamdamian 4y ago
  Incentivized how, specifically?
  - anon291 4y ago
    Well there's this thing called friendship. You see, executives at VC firms and such are typically pretty friendly with each other, and view their fellow executive's success as potentially pulling them up the ladder. AI is the next big thing. Sam Altman and his company is in a nice spot to profit. Moreover, YC research is an investor in OpenAI. Thus, because the executives want Altman to succeed (to presumably advance their own career) and because they're in charge of YC, which is an investor in openai, they have every incentive in funding startups that then use OpenAI as the main platform.
    - iamdamian 4y ago
      This hypothetical incentive structure seems tenuous at best and not the open and shut case it sounded like in your original comment. I’m sorry but I don’t buy it.
      - anon291 4y ago
        You don't buy that people want their investments to succeed and their friends to become rich? Those seem like some of the strongest incentives to me.
        nylonstrung 4y ago
        So the YC Partners are actively investing in worse companies that will degrade their returns so that OpenAI/Microsoft can add new customers that do almost no volume compared to ChatGPT or Bing? That's not how YC or VC works.
        anon291 4y ago
        There's more to businesses than simply the underlying tech. If technical superiority were the sole determinant of business success, the tech landscape would look a lot different today. Rather, YC is banking that some of the use cases get people hooked, thus causing vendor lock in, to these new apps, which end up benefiting YC both by benefitting the companies they're funding as well as benefitting open ai. I don't share the sentiment that companies that are 'just' layers over OpenAI are incapable of building moats.
autoconfig 4y ago
I think it’s both correct and realistic to assume that most ideas won’t reach venture scale size. After all, the vast majority of startups fail. However I’d like to point out that any software product that is built is per definition a layer on top of something else and it will always start small. The key question is whether that “layer” is useful and if it can keep getting increasingly useful with time.
jfengel 4y ago
I suppose it's inevitable that the first uses are going to be the trivial ones. They'll be first to market. I'm sure they imagine that when they figure out something actually worth doing, they'll already have a user base and revenue stream and reputation. If there's somebody out there doing something more innovative, they'll either buy them out or reproduce their idea in-house. Me, I'm skeptical that there's a "there" here. But that's why somebody else is getting rich and I'm not.
danielgh7 4y ago
While integrating with OpenAI is just an API call away I don't think it takes away from the user experience. Sure its less of a moat but plenty of products have won by having the best user experience and not many new features (Notion, Digital Ocean, etc.) Not every experience is going to be best suited to fit in a chat box like ChatGPT which opens the door for startups like this one to build something new. I'm excited when I see products like this, and I think we really need to retire the critique of "Its just an API call to OpenAI". While yes that is a core part of it, there is a lot of time and effort that goes into developing these experiences that has value

anon291 4y ago

Why are you surprised? OpenAI is Sam Altman's (YC's last leader) pet project. Of course, YC is highly incentivized to produce more customers for OpenAI

iamdamian 4y ago
Incentivized how, specifically?
- anon291 4y ago
  Well there's this thing called friendship. You see, executives at VC firms and such are typically pretty friendly with each other, and view their fellow executive's success as potentially pulling them up the ladder. AI is the next big thing. Sam Altman and his company is in a nice spot to profit. Moreover, YC research is an investor in OpenAI. Thus, because the executives want Altman to succeed (to presumably advance their own career) and because they're in charge of YC, which is an investor in openai, they have every incentive in funding startups that then use OpenAI as the main platform.
  - iamdamian 4y ago
    This hypothetical incentive structure seems tenuous at best and not the open and shut case it sounded like in your original comment. I’m sorry but I don’t buy it.
    - anon291 4y ago
      You don't buy that people want their investments to succeed and their friends to become rich? Those seem like some of the strongest incentives to me.
      - nylonstrung 4y ago
        So the YC Partners are actively investing in worse companies that will degrade their returns so that OpenAI/Microsoft can add new customers that do almost no volume compared to ChatGPT or Bing? That's not how YC or VC works.
        anon291 4y ago
        There's more to businesses than simply the underlying tech. If technical superiority were the sole determinant of business success, the tech landscape would look a lot different today. Rather, YC is banking that some of the use cases get people hooked, thus causing vendor lock in, to these new apps, which end up benefiting YC both by benefitting the companies they're funding as well as benefitting open ai. I don't share the sentiment that companies that are 'just' layers over OpenAI are incapable of building moats.

autoconfig 4y ago

I think it’s both correct and realistic to assume that most ideas won’t reach venture scale size. After all, the vast majority of startups fail. However I’d like to point out that any software product that is built is per definition a layer on top of something else and it will always start small. The key question is whether that “layer” is useful and if it can keep getting increasingly useful with time.

jfengel 4y ago

I suppose it's inevitable that the first uses are going to be the trivial ones. They'll be first to market. I'm sure they imagine that when they figure out something actually worth doing, they'll already have a user base and revenue stream and reputation. If there's somebody out there doing something more innovative, they'll either buy them out or reproduce their idea in-house. Me, I'm skeptical that there's a "there" here. But that's why somebody else is getting rich and I'm not.

danielgh7 4y ago

While integrating with OpenAI is just an API call away I don't think it takes away from the user experience. Sure its less of a moat but plenty of products have won by having the best user experience and not many new features (Notion, Digital Ocean, etc.) Not every experience is going to be best suited to fit in a chat box like ChatGPT which opens the door for startups like this one to build something new. I'm excited when I see products like this, and I think we really need to retire the critique of "Its just an API call to OpenAI". While yes that is a core part of it, there is a lot of time and effort that goes into developing these experiences that has value