AI as a Tool for Startups: Applying its Power

In my last post, I covered the possibilities and potential threats of AI for startups, but I also want to discuss how AI can be used as a tool for startups. 

There are some areas where I think artificial intelligence can have immediate and effective results for companies. 

The Benefits of AI as a Communication Tool for Startups

One of the most important functions within a company is communication, much of it in written form. In my experience, most people do not write well, whereas artificial intelligence machines write extremely well. I have had considerable success working with some AI systems to improve written communications. For example, one of my companies has several highly technical documents that can probably be understood by fewer than 100 people simply because they are so technical and complicated. AI has done an incredibly good job of rewriting these documents into plain language that a layperson can understand. There are other applications for using AI as an effective communication tool for startups as well. 

I have also learned that AI machines can write compelling letters and presentations proficiently. So, I think there is an enormous opportunity for companies to benefit from improving their internal and external communications for purposes such as investor relations and raising additional capital.

 AI Can Assist in Marketing As Well

Most companies could improve their sales and marketing materials by asking an AI machine to make them more compelling and readable. Companies with a writing consultant or a writing department would probably do well to make use of AI editing capabilities. 

AI Strategies: Other Ways It Can Be Used as a Tool for Startups

I recently read an interesting article from entrepreneur.com titled,  “Conventional Business Models Weren’t Cutting It—See How Innovating with AI is Changing the Game for Startups”.  

Here is the overview:  Explore how AI is revolutionizing startups, from strategic automation to innovation, and learn strategies for leveraging technology for success amid funding challenges.

I’ve summarized some of this article’s recommendations below. I believe it effectively illustrates some successful strategies for using AI as a tool for startups. 

1. Begin with your business problem, not just the technology

2. Test new technologies with a pilot project before full-scale implementation

3. Empower your team with smart technology integration

4. Avoid innovating in isolation

*By Doug Villhard Edited by Chelsea Brown Mar 7, 2024 

More to Consider: Measuring Trends in Artificial Intelligence

 As I mentioned in part one of this article, one of the potential threats of AI is the unknown. But by analyzing trends in  the AI industry, startups can make informed decisions that can help them mitigate threats and take advantage of possibilities. 

The 2023 Stanford “AI Index Report: Measuring Trends in Artificial Intelligence” presents extensive information about the state of the Artificial Intelligence industry. Here are five of their “Top 10 Takeaways”:

1. “AI beats humans on some tasks, but not on all. AI has surpassed human performance on several benchmarks, including some in image classification, visual reasoning, and English understanding. Yet it trails behind on more complex tasks like competition-level mathematics, visual commonsense reasoning, and planning.”

2. “Frontier models are getting way more expensive. According to AI Index estimates, the training costs of state-of-the-art AI models have reached unprecedented levels. For example, OpenAI’s GPT-4 used an estimated $78 million worth of computing to train, while Google’s Gemini Ultra cost $191 million.”

3. “Generative AI investment skyrockets. Despite a decline in overall AI private investment last year, funding for generative AI surged, increasing from 2022 to $25.2 billion. Major players in the generative AI space, including OpenAI, Anthropic, Hugging Face, and Inflection, reported substantial fundraising rounds.” (FMH: Generative AI helps companies create workflows that increase productivity.)

4. “AI makes workers more productive and leads to higher-quality work. In 2023, several studies assessed AI’s impact on labor, suggesting that AI enables workers to complete tasks more quickly and improve their output quality. These studies also demonstrated AI’s potential to bridge the skill gap between low-skilled and high-skilled workers. Still, other studies caution that using AI without proper oversight can lead to diminished performance.”

5. “The number of AI regulations in the United States has sharply increased. The number of AI-related regulations in the U.S. has risen significantly in the past year and over the last five years. In 2023, there were 25 AI-related regulations, up from just one in 2016. Last year alone, the total number of AI-related regulations grew by 56.3%.”

The Role of Generative AI as A Tool for Startups

Generative AI is artificial intelligence capable of generating new content—including text, images, or code—often in response to a user’s prompt. Companies increasingly incorporate them into online tools and chatbots. You’re probably familiar with these. They allow users to type questions or instructions into an input field and the AI model generates a human-like response.

Generative artificial intelligence has rapidly gained traction among businesses, professionals, and consumers. But what is generative AI?  How does it work, and what is all the buzz about? Read on to find out.

DOWNLOAD: This generative AI guide from TechRepublic Premium

More on How Generative AI Operates

Generative AI uses a computing process known as deep learning to analyze patterns in large data sets and replicate those patterns to create new data that mimics human-generated data. It employs neural networks, a machine-learning process loosely inspired by how the human brain processes, and interprets and learns from information over time.

For example, if you were to feed fiction writing into a generative AI model, it would eventually learn to craft stories or story elements based on this literature—which could include elements such as plot structure, characters, themes, and other narrative devices. This ability results from the algorithms that power generative AI models learning from the information people feed them.

These Models Will Only Get More Sophisticated With Time

Generative AI models have become more sophisticated over time. The more data a model trains on and generates, the more its outputs become more convincing and human-like. This means that the opportunities to use AI as a tool for startups will likely increase as well. 

The popularity of generative AI has exploded in recent years, largely thanks to the arrival of OpenAI’s ChatGPT and DALL-E models, which made accessible AI tools available to consumers.

Since then, tech giants including Google, Microsoft, Amazon, and Meta have launched their own generative AI tools to capitalize on the technology’s rapid uptake:

• Google integrates generative AI into Search with AI Overviews.
• Microsoft incorporates the Copilot AI into PCs. Redmond plans to build generative AI even more deeply into its PCs with Recall, although Microsoft restricted the feature to a preview for Windows Insiders following security concerns.
• Apple released Apple Intelligence, a mix of proprietary AI models and OpenAI technology, in iOS 18, iPadOS 18, and macOS Sequoia later this year.

Various generative AI tools exist, although text and image generation models are arguably the most well-known. Google and Meta have demonstrated photorealistic image generators, although these are not publicly available as of now.

Is Generative AI a Business Opportunity or a Tool for Startups?

According to the Gartner Group, Generative AI could significantly impact shareholder value by creating new and disruptive opportunities to drive enterprise goals such as:

• Help enterprises create new products and increase more quickly.
• Create greater customer engagement.
• Reduce costs and improve productivity.

So far, the primary business functions that have adopted or intended to invest in some form of Generative AI solution are:

• Customer service (16%)
• Marketing (14%)
• Sales (12%)

Conclusion

Startups may have more to gain by using AI as a tool rather than trying to make AI a core of their business strategy. That may be more of a large company game. There are many ways that AI can augment a company’s strategies, and companies that find the people to leverage those tools may be the short-term winners.