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I've noticed this as well. It's a huge boon for startups, because it means that a lot of functions that you would previously need to hire specialists for (logo

I've noticed this as well. It's a huge boon for startups, because it means that a lot of functions that you would previously need to hire specialists for (logo design! graphic design! programming! copywriting!) can now be brought in-house, where the founder just does a "good enough" job using AI. And for those that can't (legal, for example, or various SaaS vendors) the AI usually has a good idea of what services you'd want to engage. Ironically though, having lots of people found startups is not good for startup founders, because it means more competition and a much harder time getting noticed. So its unclear that prosumers and startup founders will be the eventual beneficiary here either. It would be ironic if AI actually ended up destroying economic activity because tasks that were frequently large-dollar-value transactions now become a consumer asking their $20/month AI to do it for them.

mnky9800n 1y ago
But if startups have less specialist needs they have less overall startup costs and so the amount of seed money needed goes down. This lowers the barrier for entry for a lot of people but also increases the number of options for seed capital. Of course it likely will increase competition but that could make the market more efficient.
bossyTeacher 1y ago
> I've noticed this as well. It's a huge boon for startups, because it means that a lot of functions that you would previously need to hire specialists for (logo design! graphic design! programming! copywriting!) can now be brought in-house, where the founder just does a "good enough" job using AI. You are missing the other side of the story. All those customers, those AI boosted startups want to attract also have access to AI and so, rather than engage the services of those startups, they will find that AI does a good enough job. So those startups lost most of their customers, incoming layoffs :)
- ares623 1y ago
  Then there's the 3rd leg of the triangle. If a startup built with AI does end up going past the rest of the pack, they will have no technical moat since the AI provider or someone else can just use the same AI to build it.
  - makk 1y ago
    How frequently is a technical moat the thing that makes a business successful, relative to other moats?
    - ares623 1y ago
      I mean, if taxi companies could build their own Uber in house I’m sure they’d love to and at least take some customers from Uber itself. A lot of startups are middlemen with snazzy UIs. Middlemen won’t be in as much use in a post AI world, same as devs won’t be as needed (devs are middlemen to working software) or artists (middlemen to art assets)
      - LtWorf 1y ago
        But it's not technical, it's due to uber having spent incredible amounts of money into marketing.
        oblio 1y ago
        It is technical :-) The Uber app is a lot more polished (and deep) than the average taxi app.
        r_lee 1y ago
        No, Uber works nationwide but you'd have to download a Taxi app for every place you went and ... etc. The economies of scale is what makes companies like Uber such heavyweights at least in my opinion Same with AWS etc.
        ipaddr 1y ago
        That's why you use Uber because the app has more depth and is more polished? Most people use it for price, ability to get driver quickly, some for safety and many because of brand. Having a functioning app with an easy interface helps onboard and funnel people but it's not a moat just an on ram like a phone number many taxis have.
chii 1y ago
> ironic if AI actually ended up destroying economic activity that's not destroying economic activity - it's removing a less efficient activity and replace it with a more efficient version. This produces economic surplus. Imagine saying this for someone digging a hole, that if they use a mechanical digger instead of a hand shovel, they'd destroy economic activity since it now cost less to dig that hole!
- nostrademons 1y ago
  It's not that it's replacing one form of activity with a cheaper one, it's that it removes the transaction. Which means that now there's nothing to tax, and nothing to measure. As far as GDP is concerned, economic activity will have gone down, even though the same work is being accomplished differently.
  - dghlsakjg 1y ago
    This sounds in awful lot like a cousin of the broken window fallacy. The fallacy being that when a careless kid breaks a window of a store, that we should celebrate because the glazier now has been paid to come out and do a job. Economic activity has increased by one measure! Should we go around breaking windows? Of course not.
    - nostrademons 1y ago
      It very much is a cousin of the broken window fallacy. Bastiat's original point of the Parable of the Broken Window could be summed up by the aphorism "not everything that counts can be counted, and not everything that can be counted counts". It's a caution to society to avoid relying too much on metrics, and to realize that sometimes positive metrics obscure actual negative outcomes in society. It's very similar to the practice of startups funded by the same VC to all buy each others' products, regardless of whether they need them or not. At the end of the day, it's still the same pool of money, it has largely come around, little true economic value has been created: but large amounts of revenue has been booked, and this revenue can be used to attract other unsuspecting investors who look only at the metrics. Or to the childcare paradox and the "Two Income Trap" identified by Elizabeth Warren. Start with a society of 1-income families, where one parent stays home to raise the kids and the other works. Now the other parent goes back to work. They now need childcare to look after the kids, and often a cleaner, gardener, meals out, etc. to manage the housework, very frequently taking up the whole income of the second parent. GDP has gone up tremendously through this arrangement: you add the second parent's salary to the national income, and then you also the cost of childcare, housework, gardening, all of those formerly-unpaid tasks that are now taxable transactions. But the net real result is that the kids are raised by someone other than their parents, and the household stuff is put away in places that the parents probably would not have chosen themselves. Regardless, society does look at the metrics, and usually weights them heavier than qualitative outcomes they represent, sometimes resulting in absurdly non-optimal situations.

mnky9800n 1y ago

But if startups have less specialist needs they have less overall startup costs and so the amount of seed money needed goes down. This lowers the barrier for entry for a lot of people but also increases the number of options for seed capital. Of course it likely will increase competition but that could make the market more efficient.

bossyTeacher 1y ago

> I've noticed this as well. It's a huge boon for startups, because it means that a lot of functions that you would previously need to hire specialists for (logo design! graphic design! programming! copywriting!) can now be brought in-house, where the founder just does a "good enough" job using AI. You are missing the other side of the story. All those customers, those AI boosted startups want to attract also have access to AI and so, rather than engage the services of those startups, they will find that AI does a good enough job. So those startups lost most of their customers, incoming layoffs :)

ares623 1y ago
Then there's the 3rd leg of the triangle. If a startup built with AI does end up going past the rest of the pack, they will have no technical moat since the AI provider or someone else can just use the same AI to build it.
- makk 1y ago
  How frequently is a technical moat the thing that makes a business successful, relative to other moats?
  - ares623 1y ago
    I mean, if taxi companies could build their own Uber in house I’m sure they’d love to and at least take some customers from Uber itself. A lot of startups are middlemen with snazzy UIs. Middlemen won’t be in as much use in a post AI world, same as devs won’t be as needed (devs are middlemen to working software) or artists (middlemen to art assets)
    - LtWorf 1y ago
      But it's not technical, it's due to uber having spent incredible amounts of money into marketing.
      - oblio 1y ago
        It is technical :-) The Uber app is a lot more polished (and deep) than the average taxi app.
        r_lee 1y ago
        No, Uber works nationwide but you'd have to download a Taxi app for every place you went and ... etc. The economies of scale is what makes companies like Uber such heavyweights at least in my opinion Same with AWS etc.
        ipaddr 1y ago
        That's why you use Uber because the app has more depth and is more polished? Most people use it for price, ability to get driver quickly, some for safety and many because of brand. Having a functioning app with an easy interface helps onboard and funnel people but it's not a moat just an on ram like a phone number many taxis have.

chii 1y ago

> ironic if AI actually ended up destroying economic activity that's not destroying economic activity - it's removing a less efficient activity and replace it with a more efficient version. This produces economic surplus. Imagine saying this for someone digging a hole, that if they use a mechanical digger instead of a hand shovel, they'd destroy economic activity since it now cost less to dig that hole!

nostrademons 1y ago
It's not that it's replacing one form of activity with a cheaper one, it's that it removes the transaction. Which means that now there's nothing to tax, and nothing to measure. As far as GDP is concerned, economic activity will have gone down, even though the same work is being accomplished differently.
- dghlsakjg 1y ago
  This sounds in awful lot like a cousin of the broken window fallacy. The fallacy being that when a careless kid breaks a window of a store, that we should celebrate because the glazier now has been paid to come out and do a job. Economic activity has increased by one measure! Should we go around breaking windows? Of course not.
  - nostrademons 1y ago
    It very much is a cousin of the broken window fallacy. Bastiat's original point of the Parable of the Broken Window could be summed up by the aphorism "not everything that counts can be counted, and not everything that can be counted counts". It's a caution to society to avoid relying too much on metrics, and to realize that sometimes positive metrics obscure actual negative outcomes in society. It's very similar to the practice of startups funded by the same VC to all buy each others' products, regardless of whether they need them or not. At the end of the day, it's still the same pool of money, it has largely come around, little true economic value has been created: but large amounts of revenue has been booked, and this revenue can be used to attract other unsuspecting investors who look only at the metrics. Or to the childcare paradox and the "Two Income Trap" identified by Elizabeth Warren. Start with a society of 1-income families, where one parent stays home to raise the kids and the other works. Now the other parent goes back to work. They now need childcare to look after the kids, and often a cleaner, gardener, meals out, etc. to manage the housework, very frequently taking up the whole income of the second parent. GDP has gone up tremendously through this arrangement: you add the second parent's salary to the national income, and then you also the cost of childcare, housework, gardening, all of those formerly-unpaid tasks that are now taxable transactions. But the net real result is that the kids are raised by someone other than their parents, and the household stuff is put away in places that the parents probably would not have chosen themselves. Regardless, society does look at the metrics, and usually weights them heavier than qualitative outcomes they represent, sometimes resulting in absurdly non-optimal situations.