Investing in AI startups is hard

Rapidly declining costs for computational intelligence has lead to a profusion of copycat companies competing for the same pool of customers

Sorting AI users into buckets

My mental model for sorting AI users into various buckets is basically the following:

1. Foundational model builders (Google, Meta, Microsoft/OpenAI, etc.)

2. Entrepreneurs building on top of LLMs (GPT wrappers, AI-powered SaaS startups, etc.)

3. End users (consumers and/or businesses)

For the foundational model builders: LLMs are a sale…