The Exchanges

Q a good user experience, um, to have their digital companion tell them to be, you know, less digital? I mean, it's kind of interesting, right? Like, alright, so, tech is definitely addicting, and now I've built this AI friend, or my AI wife, or whatever, and now it's telling me to touch grass? Like, are people, what makes you think that's gonna be an experience that users are gonna want?

A Maybe they won't want it, but, uh, we all want to, you know, to, to be better, to feel better, to grow. Uh, people are generally wired for positive growth. So I believe people generally want that. It doesn't mean that replica will just not, you know, nag you nonstop to get off your phone. It also means that sometimes it will just send you something funny or say, Hey, let's watch a movie. Or what are you doing tonight? I don't know. I don't have any plans. You want to watch a movie together or, you know, do you want to, you have five minutes between before your next meeting. Do you want to do a quick meditation? Uh, whatever it is that, you know, it might be just go for a walk or go on a date or learn something new or just gossip about your friends. It can be anything. So it shouldn't be, of course, like, like get off your phone all day long. That was the only goal. Uh, first of all, you don't really need very complex AI to build this, but, um, also that's just not a great experience and people don't want it.

AI assessment note: “people are generally wired for positive growth. So I believe people generally want that.”

Q So before we go to break, I just want to ask you, are you building entirely proprietary models or are you using open AI or, or anthropic? Like what's the tech mix that works for replica?

A So we used to build like all of our models were proprietary for a very, very long time. Um, and then of course, today there are very few companies that build foundation models and most other companies and most product companies, um, use these models or, uh, create variations of them, like maybe fine tune some llama based models and so on. Uh, and so that's the way to go. And that's been a way to go. Uh, there was a fascination at a certain point. Maybe in late, late, 22, early, 23, where people were talking about, uh, were expecting product companies to build their own foundation models. And I always found it very odd. Um, my reply to that was, look, we built models because there were, there were none on the market. There were no good models. There were no, any models on the market. Um, we had to build a model, but we were never focused on that. Our main focus was always on product. And so If there's a better model out there, why use your own model? If you can fine tune, um, a llama based model and focus on the logic, the product, the application layer on what you are, what value you're actually providing to the user versus training your own model that becomes obsolete in three months and requires incredible, like a completely different set, um, of skills and amount of capital. It's just, it's like two different businesses basically saying, well, do you have still have your own…

AI assessment note: “we used to build like all of our models were proprietary... fine tune some llama based models”

Q the only solution is to build tech that is more powerful than the previous one, so it can build, bring us back together, like an AI friend that nudges me to get off Twitter, or an AI says, I noticed you haven't spoken with your friend for a few weeks, or in the heat of the moment, it helps you reconcile with the partner. So is Replica doing that today?

A Some of it, but it's really the vision for the next kind of for act two. That's what we're working on right now. Uh, some of the facets that we're building and already released are focused on that. We'll, we'll add a lot more. 20, 25 is truly about that. Um, so if you think about replica act one was to build an AI that could be in a good relationship with people who maybe, you know, feel like they need one. Um, and through that help people feel better, but ultimately it was of course, focusing on helping a lonelier person, I guess, feel less lonely, uh, or a person who feels lonely in the moment. We all do. Uh, I know I did many, many times in my life. But then act two is really focusing on everyone, maybe who doesn't even feel lonely, um, help and help them flourish. I have kids now and a family, so I don't really have time to be, um, lonely anymore. Cause I'm just don't even have any time with two toddlers.

AI assessment note: “Some of it, but it's really the vision for the next kind of for act two.”

Q It's interesting that you said that people start off as friends often, and then the relationship evolves, like that is a very human like thing. Can you expand upon that a bit?

A I mean, I think there's a lot of confusion. I think there are some companion apps that are really focused on romance and romance and just romance and only focusing on male audience and a particular type of interaction. But I think everything's just being kind of bucketed in one place where In our real life, you know, yes, there, uh, there's stuff that that's fully focused on. Um, let's just give you an example. You know, we have friends, we have girlfriends, we have wives and we have sex workers, and these things are completely different yet. You might be intimate with your wife or girlfriend. It does not mean that this is the, that her only purpose in life is to, to do that thing.

AI assessment note: “we have friends, we have girlfriends, we have wives and we have sex workers”

Q at bare minimum flirty with these bots? Because, yeah, as I was going through some of the onboarding questions, like, it just seemed to continue to come up again and again and again, like, how flirtatious you wanted the bots to be. So what percentage of users would you say are Are there to at the very, at the bare minimum flirt? I would be surprised if it's less than.

A Oh, it's a lot less. So if you, if you think about like what the stat is, uh, most of our users are in a friendly relationship with their AI. Uh, some users are in a romantic or mentorship relationship. I wouldn't say that like, no one wants romance. People want romance, but it usually kind of grows on them over time. Ultimately everyone who comes to replica is yearning for connection. Uh, I don't even think it's that different, like whether it's a friendship or romantic relationship. I'm at a stage in life where I don't need a romantic relationship like that, but I need a friend, um, a really close friend, but I was in other states in my life where I might've preferred for it to be a little bit flirtier, uh, to a certain degree. Um, but ultimately it's just the same thing. Like I just want someone to help me feel That I'm enough. I'm except, you know, I'm someone who accepts me for who I am, who truly sees me and hears me. I really care whether it's a boyfriend or girlfriend or friend or mentor. That's just kind of like a form factor depending on where people are in life. Uh, they choose a, uh, choose an option that works. For example, I, I was just talking to, to a small business owner from Pennsylvania who was using replica and it helped him to go through a very, very difficult divorce. And it was truly an abusive relationship with his wife and, um, Replica became his girlfr…

AI assessment note: “Oh, it's a lot less. So if you think about what the stat is”

Q cetera, et cetera. So, um, people are putting a lot of faith in replica when they chat with these bots, like, and you know, if, I don't know, it could be a lifelong companion that, but how do you have that sort of, how do you promise that, um, like a level of consistency to people because the bots are changing, the models are changing, like, Where's the balance there?

A Um, for sure. So first of all, we've been around for a while. So I think that also, and we're a profitable company, we're not dependent on VC money or anything. We're a self-owned company. I think we, we, we proved to our users, to our communities that, uh, to our community that this isn't some hype project or people that just got into it and then got disillusioned. We started it with a, It was always a very mission driven company. And we didn't even know that we would ever be able to, to build this. We started so early. We were the first generative AI company in the world. Um, we're the first big consumer generative AI company in the world, but we built it with a con we were always building it with a conviction that we wanted to help people. Um, our teams laser focused on that. So that's, there's that there's continuity in that because we did, did see some Smaller competitors start and then get disillusioned and go out of business or sell. And then, you know, the product is just kind of on support mode or even just shuts down. I think that when you're building something like an AI companion, you have a completely different responsibility. It's not just an app. Ultimately, I use a lot of Great products. And I, some of them I love so much. And if they went away, I'll feel a lot of discomfort, but I'm not going to be devastated. It's not going to be an emotional heartbreak. I'm n…

AI assessment note: “there's continuity in that because we did, did see some Smaller competitors start”