Latent Space: The AI Engineer Podcast
00:58:40 · Shawn Wang, Jamin Ball
[00:58:40] S1: I mean, that's exactly why they shut down SORA. [00:58:41] S0: Yeah. Experience good. You need to. And at the end of the day, what a lot of people have decided is, well, guess what? A lot of the highest ROI, most economically valuable work, has been in coding. So it's hard to prioritize anything else other than that. It's why there's probably opportunities for other companies and startups to build models and build products in those domains because guess what? What is open ad, Anthropic chasing? They're not chasing the incremental $10,000,000,000 market cap. They're chasing the next trillion. And so the reality is for a startup or a neolab, great. You could go build a company, build a product, build a model where you exit for $10,000,000,000 and it's a home run. Grand slam. That's awesome. And simultaneously, it's too small for OpenAI and Anthropic to matter. And so like, what is Anthropic done just a bang up job at? They said coding is our thing. We're gonna be great at coding. We're gonna build the best coding harness in Claude Code, and we're gonna continue to nail it. I think everyone is kind of starting to ask themselves, well, when do we... Maybe you asked a version of this earlier. When do we tap out the coding TAM? I think one point of view is [00:59:41] S1: I have asked very many times this question.
00:59:41 · Shawn Wang, Jamin Ball
[00:59:41] S1: I have asked very many times this question. [00:59:43] S0: But I think one point of view is, hey, coding is actually the best generalizing And model and that can be applied. You think of it as coding, but when I use Claude code, I'm not coding, but I'm using Claude code. When you use Codex, are you coding? No. They're generalizing, and coding is a good framework for generalizing knowledge work. I do think you're seeing a big push by both OpenAI and Anthropic into life sciences and drug discovery. I think they've both been quite public about their interests to kind of like capture that domain as as a new field. And I do think those are just different. [01:00:24] S1: And it would seem like Anthropic is investing more than OpenAI on I specifically the live science stuff.
01:00:24 · Shawn Wang, Jamin Ball
[01:00:24] S1: And it would seem like Anthropic is investing more than OpenAI on I specifically the live science stuff. [01:00:28] S0: Yeah. I'd I'd agree. I'd agree. But now I can't remember the question you asked. But I but I do think you're starting to see these companies evolve the scope of what they want to go after, and it has been very targeted on coding, given it's been the best generalizing... You you want to generalize knowledge work. These models have generalized the best as they've been stronger in coding. But it also can give it some... A soft underbelly to other areas. Maybe it's visual thinking and reasoning. You're seeing great models there like Allurion. Maybe it's decision models like JEV and TypeSafe. Right? Like, there's there's a lot of different soft underbellies they may have, which is great. It's opportunities. Like, you'd love to see better cheaper models in other domains. You know, you don't need to drive the Ferrari engine to the grocery store. Hey. Maybe you... A Toyota will do just fine. Yeah. And I think that will continue. [01:01:18] S1: And good to Lauren shout out. We just interviewed Andrew Oh, no kidding. On his benchmark and and you... And glimpse, I think. Glimpse. Are you guys invested? [01:01:25] S0: Or We are.
01:01:25 · Jamin Ball, Shawn Wang
[01:01:25] S0: Or We are. [01:01:25] S1: Oh, yeah. Oh, wow. Promotion. Wow. Okay. Alright. Yes. It's it's it's weird to... Like, this is a whole different discussion, but, ultimately, I don't get as, like, well, you will lead the giant rounds in, like, you know, the Anthropic of the world, but you also care about Elorean. Yeah. It's, like, way smaller and, like Totally. You know, probably worth, like, a minute of your time. [01:01:43] S0: Yeah. Well, no. Like like, worth worth a ton of my time. I mean, I would say, like, we barbell. I mean, we're life cycle investors. We invest early, we invest late, and we invest in the public markets. And I think there's a lot of value. Like, the way we think about it is some of the best founders today, they need late stage capabilities early on. And late stage capabilities isn't just capital, it's relationships with execs, it's relationships with public companies. I mean, companies are built on hyper mode now. Right? It's not let me go raise a round and let me, you know, add 10,000,000 of ARR in eighteen months, and I'll go raise my next round [01:02:15] S1: and then [01:02:15] S0: two years later. It's like, you're you're growing to a 100,000,000 super fast. You're you're raising 9 figures of of money super quickly, and it's and it's hard. I mean, in many ways, like, you have to, like, break the laws of physics to how, like, cultures can be maintained. Lawyers are [01:02:28] S1: not set up for this. They're like It's hard. What do mean when we come here on a weekend to... Because, like, Monday might be different.
01:02:28 · Shawn Wang, Jamin Ball
[01:02:28] S1: not set up for this. They're like It's hard. What do mean when we come here on a weekend to... Because, like, Monday might be different. [01:02:33] S0: Yeah. Exactly. Exactly. Exactly. I mean, it's... You you used to think about as a board member and investor, hey. Let me think ahead. [01:02:40] S1: Like, next next quarter. [01:02:41] S0: Let me make sure we hire the VP of sales and the CFO, you know, six months before before we need to. So we're not behind. Now it's like, hey, six months before you need to may have been before the company was even incorporated, you know? And so how do you how do you do that? Like, when do you hire the right execs so you're not doing it too late? How do you hire ahead, but not too ahead? I mean, it's... I feel like the pressure of building companies has never been greater. Now the size of the prize has never been greater, but it is... It's just... You know, it might appear as easy as ever to build a company, but I actually think it's the opposite. It's almost as hard as ever to build a good company, and maybe more importantly to build a durable company, which is I think what what everyone aspires to do. [01:03:17] S1: Yeah. I'll also shout out the... On, you know, on the model factory thing. We also interviewed Poolside, [01:03:21] S0: which was [01:03:22] S1: acquired by NVIDIA. Yes. They were pitching this model factory really hard. And I I I do think, like, the business that builds the business is kind of like the the the the general [01:03:29] S0: Mhmm.
01:03:29 · Jamin Ball, Shawn Wang
[01:03:29] S0: Mhmm. [01:03:30] S1: Takeaway that I want people to know. One of the things I wanted to... I was diving towards... I I didn't I didn't quite start it yet, I'll start it now, which is typically when you have an s one, you have a clear sense of the business. Let's call it market segments, product segments Mhmm. The org chart, the whatever. Mhmm. And we got Claude Code. Yeah. Claude Cowork. Yeah. Miscellaneous. Yeah. Or platform. Whatever. Yeah. Yeah. Yeah. And I'm like, okay. What about legal? What about design? Like, all this stuff that you've... Claude dot ai, the consumer business. Yeah. Yeah. For a while, that was a thing. Mhmm. Mhmm. Do we care? Do we... Is this all like one revenue bucket? You know? [01:04:07] S0: I I think we do care. [01:04:09] S1: Like, the products. Right? Like, this Claude Yeah. Code, and what else? [01:04:14] S0: I I... And this is where I do think and there was there was a section of the s one where they broke out some of these vertical applications they wanna go after. I mean, it it... It's kinda funny you bring this up. Like, I had a hypothesis, you know, years ago that, like, hey. Maybe the labs will stop releasing models, And instead, they'll just build applications and products powered by their models. [01:04:36] S1: Yes. [01:04:36] S0: And if they're powered by the best models that are never released publicly, hey, maybe they have the right to build all the best applications. [01:04:42] S1: That you kill Harvey by only using Claude Fable six legal.