Exploring AI's Hidden Capabilities

Guillermo Rauch shares his perspective on the evolution of software development and AI, contrasting traditional programming (Software 1.0) with AI-driven approaches (Software 2.0), and how entrepreneurs can leverage existing AI technologies to create new platforms without needing to build foundation models from scratch.

Software 1.0 vs Software 2.0

• Software 1.0 is what Guillermo grew up with:

  • Programming languages, data structures, algorithms
  • Making things efficient through better for loops and recursion
  • Very deterministic and predictable
  • Engineers are in control of everything
  • "There's a PM giving you tickets, I know exactly what this can do, I know exactly what it can't do"

• Software 2.0 (term coined by Andrew Karpathy) represents a paradigm shift:

  • Still uses foundations of computer science but makes the process more stochastic and probabilistic
  • Instead of writing every circuit of programming, relies on training models with data
  • Output resembles what a traditional program might do
  • Has "magical emergent properties" not explicitly programmed by engineers
  • Engineers don't have to write every if-else branch or think about every corner case

The Excitement of AI Discovery

• Even creators of AI models don't know what's possible with their creations
  • "Every time a new model comes out we're all... discovering the latent space"
  • "We're all trying to figure out what is even possible"
  • This is "in stark contrast to software 1.0" where capabilities are clearly defined

Entrepreneurial Opportunities in AI

• Entrepreneurs don't need to train foundation models:

  • "Just need to go in and put the pieces together into opinionated workflows"
  • Look for "permutations of technologies that already exist that are making new platforms possible"

• Identify clusters of queries people are using ChatGPT for:

  • These can become entire platforms
  • Example: When ChatGPT came out, people asked for NDAs → legal platforms emerged
  • People asked for web UI → Vercel created V0 for web development

• Specific platform ideas:

  • V0 for creating video games combining Software 1.0 and 2.0 techniques
  • AI Camera app that uses the photo as input to a prompt:
    • Automatically fixes common photo issues (blinking, lighting)
    • Removes unwanted objects
    • Provides multiple enhanced versions
    • Combines existing models into useful workflows

• Focus on creating opinionated workflows:

  • "Your job will mostly be to combine models, create pipelines of models, prompting"
  • "Embrace the wrapper, embrace the fact that models are fucking phenomenal"