AI Application Layer

“My general working thesis was like, you should probably just invest in anything that Enables or extends like Anthropic and OpenAI's revenue. And then the hedge to that would be open source. So just go over there and the app layer stuff by and large do not enab…”

“The profile of a founder at the application layer is a wild experimentalist, right? So you need somebody who's like right at the jagged edge of what's possible, who is not in love with their technology. Because their technology today is changing constantly und…”

“We were admittedly slower than our peers on the application layer for AI because we were very worried about how fickle they were when the wakes of the models were getting wider and wider, and we spent a lot of time in infrastructure, and we're continuing to sp…”

“I think there is still value to be created and accrued to the infrastructure layer. We're not done. The build out's not done. But I also think now that we've got enough new toys at the technology that we will see massive value creation in the application layer…”

“Now on the other hand, if the returns to these frontier tokens relative to other tokens come down, there's going to be an explosion in value creation at the application layer.”

“To the extent that that is encoded in a model, I think a lot of their business will be at risk, but to the extent that it is encoded in workflows that is where they will be able to develop mode.”

“New transformational companies, by definition, rarely emerge from existing categories. So we actually find this application layer relatively uninteresting, again, from a pre-seed and seed stage venture perspective which is where, you know, we largely operate.”

“If you're a huge foundation model and you can kind of hit every layer of the stack, there's probably more revenue for you to take advantage of than if you're just at the application layer.”

“That last step where you're actually solving someone's problem, that's where you generally can capture the most margin.”

“I think the level of talent and the fierceness of competition is, in many of these is actually like, Greater even in the application layer, which is crazy to say, because I think the competition in the Foundation Labs is extremely strong.”

“The number of opportunities, meaning the amount of stuff that is possible that no one's built yet in the world, seems much greater than the number of people with the skill to build them. So definitely at the application layer, it feels like there's a lot of wh…”

“When I joined Perplexity and was writing out my pro-con list, I think the one that was, like, up there was, like, can the application layer capture and monetize value? And, or is it all just, you know, one big pass through cost? And now, you know, fast forward…”

“For me as an investor, I see so many AI companies, and I'm not investing in any application layer of AI companies.”

“And so if the analogy holds, then you really, you know, as an investor, it's the odds of success are going to be significantly higher at the application layer because the diversity of needs there is greater.”