The following is a conversation with Kai-Fu Lee.
He's the chairman and CEO of Cinnovation Ventures
that manages a $2 billion dual currency investment fund
with a focus on developing the next generation
of Chinese high-tech companies.
He's the former president of Google China
and the founder of what is now called Microsoft Research Asia,
an institute that trained many
of the artificial intelligence leaders in China,
including CTOs or AI execs at Baidu,
Tencent, Alibaba, Lenovo, and Huawei.
He was named one of the 100 most influential people
in the world by Time Magazine.
He's the author of seven best-selling books in Chinese,
and most recently, the New York Times bestseller
called AI Superpowers, China, Silicon Valley,
and the New World Order.
He has unparalleled experience
in working across major tech companies and governments
on applications of AI,
and so he has a unique perspective on global innovation
and the future of AI that I think is important
to listen to and think about.
This is the Artificial Intelligence Podcast.
If you enjoy it, subscribe on YouTube and iTunes,
support it on Patreon, or simply connect with me on Twitter
at Lex Friedman.
And now, here's my conversation with Kai-Fu Lee.
I immigrated from Russia to U.S. when I was 13.
You immigrated to U.S. at about the same age.
The Russian people, the American people,
the Chinese people, each have a certain soul,
a spirit that permeates throughout the generations.
So maybe it's a little bit of a poetic question,
but could you describe your sense
of what defines the Chinese soul?
I think the Chinese soul of people today, right?
We're talking about people who have had centuries of burden
because of the poverty that the country has gone through
and suddenly shined with hope of prosperity
in the past 40 years as China opened up
and embraced market economy.
And undoubtedly, there are two sets of pressures
on the people, that of the tradition,
that of facing difficult situations,
and that of hope of wanting to be the first
to become successful and wealthy.
So that it's a very strong hunger and a strong desire
and strong work ethic that drives China forward.
And is there roots to not just this generation
but before that's deeper
than just the new economic developments?
Is there something that's unique to China
that you could speak to that's in the people?
Yeah, well, the Chinese tradition
is about excellence, dedication, and results.
And the Chinese exams and study subjects in schools
have traditionally started from memorizing 10,000 characters.
Not an easy task to start with.
And further by memorizing
his historic philosophers literature poetry.
So it really is probably the strongest
road learning mechanism created
to make sure people had good memory
and remember things extremely well.
That's I think at the same time
suppresses the breakthrough innovation.
And also enhances the speed execution get results.
And that I think characterizes the historic basis of China.
That's interesting because there's echoes of that
in Russian education as well as rote memorization.
So it's memorized a lot of poetry.
I mean, there's just an emphasis on perfection in all forms.
That's not conducive to perhaps what you're speaking to
which is creativity.
But you think that kind of education holds back
the innovative spirit that you might see
in the United States?
Well, it holds back the breakthrough innovative spirits
that we see in the United States
but it does not hold back the valuable execution oriented
result oriented value creating engines
which we see China being very successful.
So is there a difference between a Chinese AI engineer
today and an American AI engineer
perhaps rooted in the culture that we just talked about
or the education or the very soul of the people
or no?
And what would your advice be to each
if there's a difference?
Well, there's a lot that's similar
because AI is about mastering sciences
about using known technologies and trying new things
but it's also about picking from many parts
of possible networks to use
and different types of parameters to tune.
And that part is somewhat rote.
And it is also as anyone who's built AI products
can tell you a lot about cleansing the data
because AI runs better with more data
and data is generally unstructured,
error full and unclean
and the effort to clean the data is immense.
So I think the better part of American AI engineering process
is to try new things,
to do things people haven't done before
and to use technology to solve most if not all problems.
So to make the algorithm work despite not so great data,
find error tolerant ways to deal with the data.
The Chinese way would be to basically enumerate
to the fullest extent all the possible ways
by a lot of machines,
try lots of different ways to get it to work
and spend a lot of resources and money
and time cleaning up data
that means the AI engineer
may be writing data cleansing algorithms,
working with thousands of people who label or correct
or do things with the data.
That is the incredible hard work
that might lead to better results.
So the Chinese engineer would rely on
and ask for more and more and more data
and find ways to cleanse them
and make them work in the system
and probably less time thinking about new algorithms
that can overcome data or other issues.
So where's your intuition?
Where do you think the biggest impact
the next 10 years lies?
Is it in some breakthrough algorithms
or is it in just this at scale rigor,
a rigorous approach to data,
cleaning data, organizing data onto the same algorithms?
What do you think the big impact in the applied world is?
Well, if you're really in the company
and you have to deliver results,
using known techniques and enhancing data
seems like the more expedient approach
that's very low risk
and likely to generate better and better results.
And that's why the Chinese approach has done quite well.
Now, there are a lot of more challenging
startups and problems,
such as autonomous vehicles, medical diagnosis,
that existing algorithms probably won't solve.
And that would put the Chinese approach more challenged
and give the more breakthrough innovation approach
more of an edge on those kinds of problems.
So let me talk to that a little more.
So my intuition personally is that data
can take us extremely far.
So you brought up autonomous vehicles and medical diagnosis.
So your intuition is that huge amounts of data
might not be able to completely help us solve that problem.
Right. So breaking that down further,
in autonomous vehicle,
I think huge amounts of data probably will solve
trucks driving on highways,
which will deliver significant value.
And China will probably lead in that.
And full L5 autonomous is likely to require
new technologies we don't yet know.
And that might require academia
and great industrial research,
both innovating and working together.
And in that case, US has an advantage.
So the interesting question there is,
I don't know if you're familiar on the autonomous vehicle
space and the developments with Tesla and Elon Musk.
I am.
Where they are in fact, full steam ahead
into this mysterious complex world of full autonomy,
L5, L4, L5.
And they're trying to solve that purely with data.
So the same kind of thing that you're saying
is just for highway,
which is what a lot of people share your intuition.
They're trying to solve with data.
So just to link around that moment further,
do you think possible for them to achieve success
with simply just a huge amount of this training
on edge cases and difficult cases in urban environments,
not just highway and so on?
I think they'll be very hard.
One could characterize Tesla's approach
as kind of a Chinese strength approach, right?
Gather all the data you can
and hope that will overcome the problems.
But in autonomous driving,
clearly a lot of the decisions aren't merely solved
by aggregating data and having feedback loop.
There are things that are more akin to human thinking.
And how would those be integrated and built?
There has not yet been a lot of success
integrating human intelligence,
or call it expert systems if you will,
even though that's a taboo word with the machine learning.
And the integration of the two types of thinking
hasn't yet been demonstrated.
And the question is,
how much can you push a purely machine learning approach?
And of course, Tesla also has an additional constraint
that they don't have all the sensors.
I know that they think it's foolish to use LIDARs,
but that's clearly a one less very valuable
and reliable source of input that they're forgoing,
which may also have consequences.
I think the advantage of course,
is capturing data that no one has ever seen before.
And in some cases,
such as computer vision and speech recognition,
I have seen Chinese companies accumulate data
that's not seen anywhere in the Western world,
and they have delivered superior results.
But then speech recognition and object recognition
are relatively suitable problems for deep learning
and don't have the potentially need
for the human intelligence analytical planning elements.
And the same on the speech recognition side,
your intuition that speech recognition
and the machine learning approaches to speech recognition
won't take us to a conversational system
that can pass the Turing test,
which is sort of maybe akin to what driving is.
So it needs to have something more
than just simply simple language understanding,
simple language generation.
Roughly right.
I would say that based on purely machine learning approaches,
it's hard to imagine.
It could lead to a full conversational experience
across arbitrary domains, which is akin to L5.
I'm a little hesitant to use the word Turing test
because the original definition was probably too easy.
We probably do that, yeah.
The spirit of the Turing test.
That's what I was referring to.
Of course.
So you've had major leadership research positions
at Apple, Microsoft, Google.
So continuing on the discussion of America, Russia,
Chinese, Seoul, and culture and so on,
what is the culture of Silicon Valley
in contrast to China and maybe US broadly?
And what is the unique culture
of each of these three major companies in your view?
I think in aggregate Silicon Valley companies,
we could probably include Microsoft in that
even though they're not in the Valley,
is really dream big and have visionary goals
and believe that technology will conquer all
and also the self-confidence and the self-entitlement
that whatever they produce,
the whole world should use and must use.
And those are historically important.
I think Steve Jobs famous quote
that he doesn't do focus groups.
He looks in the mirror and asks the first in the mirror,
what do you want?
And that really is an inspirational comment
that says the great company shouldn't just ask users
what they want, but develop something
that users will know they want when they see it,
but they could never come up with themselves.
I think that is probably the most exhilarating description
of what the essence of Silicon Valley is,
that this brilliant idea could cause you to build something
that couldn't come out of focus groups or A-B tests.
And iPhone would be an example of that.
No one in the age of Blackberry would write down
they want an iPhone or multi-touch.
A browser might be another example.
No one would say they want that in the days of FTP,
but once they see it, they want it.
So I think that is what Silicon Valley is best at.
But it also came with a lot of success.
These products became global platforms
and there were basically no competitors anywhere.
And that has also led to a belief
that these are the only things that one should do,
that companies should not tread
on other companies' territory.
So that's a Groupon and a Yelp
and an Open Table and the Grubhub.
With each field, okay, I'm not gonna do
the other company's business,
because that would not be the pride of innovating
each of these four companies have innovated.
But I think the Chinese approach is do whatever it takes
to win and it's a winner take all market.
And in fact, in the internet space,
the market leader will get predominantly all the value
extracted out of the system.
So, and the system isn't just defined
as one narrow category, but gets broader and broader.
So it's amazing ambition for success
and domination of increasingly larger product categories,
leading to clear market winner status
and the opportunity to extract tremendous value.
And that develops a practical, result-oriented,
ultra ambitious winner take all gladiatorial mentality.
And if what it takes is to build what the competitors built,
essentially a copycat, that can be done
without infringing laws.
If what it takes is to satisfy a foreign country's need
by forking the code base and building something
that looks really ugly and different, they'll do it.
So it's contrasted very sharply
with the Silicon Valley approach.
And I think the flexibility and the speed and execution
has helped the Chinese approach.
And I think the Silicon Valley approach
is potentially challenged
if every Chinese entrepreneur is learning
from the whole world, US and China,
and the American entrepreneurs only look internally
and write off China as a copycat.
And the second part of your question
about the three companies.
The unique elements of the three companies, perhaps.
Yeah, I think Apple represents while the user,
pleased the user and the essence of design and brand.
And it's the one company and perhaps the only tech company
that draws people with a strong, serious desire
for the product and the willingness to pay a premium
because of the halo effect of the brand,
which came from the attention to detail
and great respect for user needs.
Microsoft represents a platform approach
that builds giant products that become very strong modes
that others can't do because it's well architected
at the bottom level and the work is efficiently delegated
to individuals and then the whole product is built
by adding small parts that sum together.
So it's probably the most effective high-tech assembly line
that builds a very difficult product
and the whole process of doing that
is kind of a differentiation
and something competitors can't easily repeat.
Are there elements of the Chinese approach
and the way Microsoft went about assembling
those little pieces and dominating,
essentially dominating the market for a long time
or do you see those as distinct?
I think there are elements that are the same.
I think the three American companies that had
or have Chinese characteristics
obviously as well as American characteristics
are Microsoft, Facebook and Amazon.
Yes, that's right, Amazon.
Because these are companies that will tenaciously
go after adjacent markets,
build up strong product offering
and find ways to extract greater value
from a sphere that's ever increasing
and they understand the value of the platforms.
So that's the similarity.
And then with Google,
I think it's a genuinely value-oriented company
that does have a heart and soul
and that wants to do great things for the world
by connecting information
and that has also very strong technology genes
and wants to use technology
and has found out-of-the-box ways to use technology
to deliver incredible value to the end user.
If you can look at Google, for example,
you mentioned heart and soul.
There seems to be an element where Google is
after making the world better.
There's a more positive view.
I mean, they used to have the slogan, don't be evil.
And Facebook a little bit more has a negative tend to it,
at least in the perception of privacy and so on.
Do you have a sense of how these different companies
can achieve, because you've talked about
how much we can make the world better
in all these kinds of ways with AI.
What is it about a company that can make,
give it a heart and soul, gain the trust of the public
and just actually just not be evil and do good for the world?
It's really hard.
And I think Google has struggled with that.
First, the don't do evil mantra is very dangerous
because every employee's definition of evil is different.
And that has led to some difficult employee situations
for them.
So I don't necessarily think that's a good value statement,
but just watching the kinds of things Google
or its parent company Alphabet does in new areas
like healthcare, like eradicating mosquitoes,
things that are really not in the business
of a internet tech company.
I think that shows that there is a heart and soul
and desire to do good and willingness
to put in the resources to do something
when they see it's good, they will pursue it.
That doesn't necessarily mean
it has all the trust of the users.
I realize while most people would view Facebook
as the primary target of their recent unhappiness
about Silicon Valley companies,
many would put Google in that category.
And some have named Google's business practices
as predatory also.
So it's kind of difficult to have the two parts of a body.
The brain wants to do what it's supposed to do
for shareholder, maximize profit.
And then the heart and soul wants to do good things
that may run against what the brain wants to do.
So in this complex balancing that these companies
have to do, you've mentioned that you're concerned
about a future where too few companies
like Google, Facebook, Amazon are controlling our data
or controlling too much of our digital lives.
Can you elaborate on this concern?
Perhaps do you have a better way forward?
I think I'm hardly the most vocal complainer of this.
There are a lot louder complainers out there.
I do observe that having a lot of data
does perpetuate their strength
and limit competition in many spaces.
But I also believe AI is much broader
than the internet space.
So the entrepreneur opportunity still exists
in using AI to empower financial, retail,
manufacturing, education, and applications.
So I don't think it's quite a case
of full monopolistic dominance
that totally stifles innovation.
But I do believe in their areas of strength,
it's hard to dislodge them.
I don't know if I have a good solution.
Probably the best solution is let the entrepreneurial
VC ecosystem work well and find all the places
that can create the next Google, the next Facebook.
So there will always be increasing number of challengers.
In some sense that has happened a little bit.
You see Uber, Airbnb having emerged
despite the strength of the big three.
And I think China as an environment
may be more interesting for the emergence.
Because if you look at companies between,
let's say 50 to $300 billion,
China has emerged more of such companies
than the US in the last three to four years.
Because of the larger marketplace,
because of the more fearless nature of the entrepreneurs,
and the Chinese giants are just as powerful
as American ones,
Tencent and Alibaba are very strong,
but ByteDance has emerged worth 75 billion,
and financial, while it's Alibaba affiliated,
it's nevertheless independent and worth 150 billion.
And so I do think if we start to extend
to traditional businesses,
we will see very valuable companies.
So it's probably not the case that in five or 10 years,
we'll still see the whole world
with these five companies having such dominance.
So you've mentioned a couple of times
this fascinating world of entrepreneurship in China,
of the fearless nature of the entrepreneurs.
So can you maybe talk a little bit about
what it takes to be an entrepreneur in China?
What are the strategies that are undertaken?
What are the ways to achieve success?
What is the dynamic of VCA funding
of the way the government helps companies and so on?
What are the interesting aspects here
that are distinct from,
they're different from the Silicon Valley world
of entrepreneurship?
Well, many of the listeners probably still
would brand Chinese entrepreneur as copycats.
And no doubt, 10 years ago,
that would not be an inaccurate description.
Back 10 years ago,
an entrepreneur probably could not get funding
if he or she could not describe
what product he or she is copying from the US.
The first question is who has proven this business model,
which is a nice way of asking, who are you copying?
And that reason is understandable
because China had a much lower internet penetration
and didn't have enough indigenous experience
to build innovative products.
And secondly, internet was emerging.
Link startup was the way to do things,
building a first minimally viable product
and then expanding was the right way to go.
And the American successes have given a shortcut
that if you built your minimally viable product
based on an American product,
it's guaranteed to be a decent starting point.
Then you tweak it afterwards.
So as long as there's no IP infringement,
which as far as no, there hasn't been in the mobile
and AI spaces, that's a much better shortcut.
And I think Silicon Valley would view that
as still not very honorable
because that's not your own idea to start with.
But you can't really at the same time
believe every idea must be your own
and believe in the link startup methodology
because link startup is intended to try many, many things
and then converge on that at works.
And it's meant to be iterated and changed.
So finding a decent starting point without legal violations,
there should be nothing morally dishonorable about that.
Yeah, so just a quick pause on that.
It's fascinating that that's,
why is that not honorable, right?
It's exactly as you formulated is,
it seems like a perfect start for business.
Is to look at Amazon and say,
okay, we'll do exactly what Amazon is doing.
Let's start there in this particular market
and then let's out-innovate them from that starting point.
Come up with new ways.
I mean, is it wrong to be,
except the word copycat just sounds bad,
but is it wrong to be a copycat?
It just seems like a smart strategy,
but yes, doesn't have a heroic nature to it.
That like Steve Jobs, Elon Musk,
sort of in something completely,
coming up with something completely new.
Yeah, I like the way you describe it.
It's a non-heroic, acceptable way to start a company
and maybe more expedient.
So that's I think a baggage for Silicon Valley
that if it doesn't let go,
then it may limit the ultimate ceiling of the company.
Take Snapchat as an example.
I think Evan's brilliant.
He built a great product,
but he's very proud that he wants to build his own features,
not copy others,
while Facebook was more willing to copy his features
and you see what happens in the competition.
So I think putting that handcuff on a company
would limit its ability to reach the maximum potential.
So back to the Chinese environment,
copying was merely a way to learn from the American masters,
just like if we learned to play piano or painting,
you start by copying.
You don't start by innovating
when you don't have the basic skillsets.
So very amazingly, the Chinese entrepreneurs
about six years ago started to branch off
with these lean startups built on American ideas
to build better products than American products.
But they did start from the American idea.
And today, WeChat is better than WhatsApp,
Weibo is better than Twitter,
Juhu is better than Quora, and so on.
So that I think is Chinese entrepreneurs going to step two.
And then step three is once these entrepreneurs
have done one or two of these companies,
they now look at the Chinese market and the opportunities
and come up with ideas that didn't exist elsewhere.
So products like and financial,
under which includes Alipay, which is mobile payments,
and also the financial products for loans built on that.
And also in education, VIP kid,
and in video social network, TikTok,
and in social e-commerce, Pinduoduo,
and then in ride sharing, mobile,
these are all Chinese-innovated products
that now are being copied elsewhere.
So, and an additional interesting observation
is some of these products are built on
unique Chinese demographics,
which may not work in the US,
but may work very well in Southeast Asia,
Africa, and other developing worlds
that are a few years behind China.
And a few of these products maybe are universal
and are getting traction even in the United States,
such as TikTok.
So this whole ecosystem is supported by VCs
as a virtuous cycle, because a large market
with innovative entrepreneurs will draw a lot of money
and then invest in these companies.
As the market gets larger and larger,
US market, China market is easily three, four times
larger than the US, they will create greater value
and greater returns for the VCs,
thereby raising even more money.
So at Sinovation Ventures, our first fund was 15 million,
our last fund was 500 million.
So it reflects the valuation of the companies
and us going multi-stage and things like that.
It also has government support,
but not in the way most Americans would think of it.
The government actually leaves the entrepreneurial space
as a private enterprise, so the self-regulating,
and the government would build infrastructures
that would around it to make it work better.
For example, the mass entrepreneur,
mass innovation plan builds 8,000 incubators.
So the pipeline is very strong to the VCs.
For autonomous vehicles, the Chinese government
is building smart highways with sensors,
smart cities that separate pedestrians from cars
that may allow initially an inferior autonomous vehicle
company to launch a car without increasing,
with lower casualty because the roads or the city is smart.
And the Chinese government at local levels
would have these guiding funds acting as LPs,
passive LPs to funds, and when the fund makes money,
part of the money made is given back to the GPs
and potentially other LPs to increase everybody's return
at the expense of the government's return.
So that's an interesting incentive that,
and trusts the task of choosing entrepreneurs to VCs
who are better at it than the government
by letting some of the profits move that way.
So this is really fascinating, right?
So I look at the Russian government as a case study
where, let me put it this way,
there's no such government-driven,
large-scale support of entrepreneurship.
And probably the same is true in the United States,
but the entrepreneurs themselves kind of find a way.
So maybe in a form of advice or explanation,
how did the Chinese government arrive to be this way?
So supportive entrepreneurship to be in this particular way
so forward-thinking at such a large scale.
And also, perhaps, how can we copy it in other countries?
How can we encourage other governments,
like even the United States government,
to support infrastructure for autonomous vehicles
in that same kind of way, perhaps?
Yes, so these techniques are the results
of several key things, some of which may be learnable,
some of which may be very hard.
One is just trial and error
and watching what everyone else is doing.
I think it's important to be humble
and not feel like you know all the answers.
The guiding funds idea came from Singapore,
which came from Israel.
And China made a few tweaks and turned it into a,
because the Chinese cities and government officials
kind of compete with each other
because they all want to make their city more successful
so they can get the next level in their political career.
And it's somewhat competitive.
So the central government made it a bit of a competition.
Everybody has a budget.
They can put it on AI or they can put it on bio
or they can put it on energy.
And then whoever gets the results, the city shines,
the people are better off, the mayor gets a promotion.
So the tools, this is kind of almost
like an entrepreneurial environment for local governments
to see who can do a better job.
And also many of them try different experiments.
Some have given award to very smart researchers,
just give them money and hope they'll start a company.
Some have given money to academic research labs,
maybe government research labs,
to see if they can spin off some companies
from the science lab or something like that.
Some have tried to recruit overseas Chinese
to come back and start companies
and they'd had mixed results.
The one that worked the best was the guiding funds.
So it's almost like a lean startup idea
where people try different things
and what works sticks and everybody copies.
So now every city has a guiding fund.
So that's how that came about.
The autonomous vehicle and the massive spending
in highways and smart cities, that's a Chinese way.
It's about building infrastructure to facilitate.
It's a clear division of the government's responsibility
from the market.
The market should do everything in a private freeway,
but there are things the market can't afford to do,
like infrastructure.
So the government always appropriates large amounts of money
for infrastructure building.
This happens with not only autonomous vehicle and AI,
but happened with the 3G and 4G.
You'll find that the Chinese wireless reception
is better than the US because massive spending
that tries to cover the whole country.
Whereas in the US, it may be a little spotty.
It's a government driven because I think they viewed
the coverage of cell access and 3G, 4G access
to be a governmental infrastructure spending
as opposed to capitalistic.
So that's, of course, the state-owned enterprises
are also publicly traded,
but they also carry a government responsibility
to deliver infrastructure to all.
So it's a different way of thinking
that may be very hard to inject into Western countries
to say starting tomorrow,
bandwidth infrastructure and highways
are gonna be governmental spending
with some characteristics.
What's your sense?
And sorry to interrupt,
but because it's such a fascinating point.
Do you think on the autonomous vehicle space,
it's possible to solve the problem of full autonomy
without significant investment in infrastructure?
Well, that's really hard to speculate.
I think it's not a yes, no question,
but how long does it take question?
15 years, 30 years, 45 years.
Clearly with infrastructure augmentation,
whether it's road, the city or whole city planning,
building a new city,
I'm sure that will accelerate the day of the L5.
I'm not knowledgeable enough
and it's hard to predict even when we're knowledgeable
because a lot of it is speculative.
But in the US, I don't think people would consider
building a new city the size of Chicago
to make it the AI slash autonomous city.
There are smaller ones being built, I'm aware of that.
But is infrastructure spend really impossible
for US or Western countries?
I don't think so.
But the US highway system was built,
was that during President Eisenhower or Kennedy?
Eisenhower, yeah.
So maybe historians can study
how the President Eisenhower get the resources
to build this massive infrastructure
that surely gave US a tremendous amount of prosperity
over the next decade, if not century.
If I may comment on that,
then it takes us to artificial intelligence a little bit
because in order to build infrastructure,
it creates a lot of jobs.
So I'll be actually interested if you would say
that you talk in your book about all kinds of jobs
that could and could not be automated.
I wonder if building infrastructure is one of the jobs
that would not be easily automated.
Something you can think about
because I think you've mentioned somewhere in the talk
or that there might be, as jobs are being automated,
a role for government to create jobs
that can't be automated.
Yes, I think that's a possibility.
Back in the last financial crisis,
China put a lot of money
to basically give its economy a boost
and a lot of it went into infrastructure building.
And I think that's a legitimate way at the government level
to deal with the employment issues
as well as build out the infrastructure.
As long as the infrastructures are truly needed
and as long as there isn't an employment problem,
which we don't know.
So maybe taking a little step back,
if you've been a leader and a researcher in AI
for several decades, at least 30 years.
So how has AI changed in the West and the East
as you've observed, as you've been deep in it
over the past 30 years?
Well, AI began as the pursuit
of understanding human intelligence.
And the term itself represents that.
But it kind of drifted into the one sub area
that worked extremely well, which is machine intelligence.
And that's actually more using pattern recognition techniques
to basically do incredibly well on a limited domain,
large amount of data,
but relatively simple kinds of planning tasks
and not very creative.
So we didn't end up building human intelligence.
We built a different machine
that was a lot better than us, some problems,
but nowhere close to us on other problems.
So today, I think a lot of people still misunderstand
when we say artificial intelligence
and what various products can do,
people still think it's about replicating human intelligence,
but the products out there really are closer
to having invented the internet or the spreadsheet
or the database and getting broader adoption.
And speaking further to the fears,
near-term fears that people have about AI,
so you're commenting on the general intelligence
that people in the popular culture from sci-fi movies
have a sense about AI,
but there's practical fears about AI,
the narrow AI that you're talking about
of automating particular kinds of jobs,
and you talk about them in the book.
So what are the kinds of jobs in your view
that you see in the next five, 10 years
beginning to be automated by AI systems algorithms?
Yes, this is also maybe a little bit counterintuitive
because it's the routine jobs
that will be displaced the soonest,
and they may not be displaced entirely,
maybe 50%, 80% of a job,
but when the workload drops by that much,
employment will come down.
And also another part of misunderstanding
is most people think of AI replacing routine jobs,
then they think of the assembly line, the workers.
Well, that will have some effect,
but it's actually the routine white-collar workers
that's easiest to replace
because to replace a white-collar worker,
you just need software.
To replace a blue-collar worker,
you need robotics, mechanical excellence,
and the ability to deal with dexterity
and maybe even unknown environments.
Very, very difficult.
So if we were to categorize the most dangerous
white-collar jobs,
there would be things like back office,
people who copy and paste
and deal with simple computer programs and data
and maybe paper and OCR,
and they don't make strategic decisions.
They basically facilitate the process.
These software and paper systems don't work,
so you have people dealing with new employee orientation,
searching for past lawsuits and financial documents,
and doing reference check.
So basic searching and management of data.
Of data.
That's the most in danger of being lost.
In addition to the white-collar repetitive work,
a lot of simple interaction work can also be taken care of,
such as telesales, telemarketing, customer service,
as well as many physical jobs
that are in the same location
and don't require a high degree of dexterity.
So fruit picking, dishwashing, assembly line inspection
are jobs in that category.
So altogether, back office is a big part.
And the other, the blue collar may be smaller initially,
but over time, AI will get better.
And when we start to get to over the next 15, 20 years,
the ability to actually have the dexterity
of doing assembly line, that's a huge chunk of jobs.
And when autonomous vehicles start to work,
initially starting with truck drivers,
but eventually to all drivers,
that's another huge group of workers.
So I see modest numbers in the next five years,
but increasing rapidly after that.
On the worry of the jobs that are in danger
and the gradual loss of jobs,
I'm not sure if you're familiar with Andrew Yang.
Yes, I am.
So there's a candidate for president of the United States
whose platform Andrew Yang is based around,
in part around job loss due to automation.
And also in addition, the need perhaps
of universal basic income to support jobs that are,
folks who lose their job due to automation and so on.
And in general, support people
under complex, unstable job market.
So what are your thoughts about his concerns,
him as a candidate, his ideas in general?
I think his thinking is generally in the right direction,
but his approach as a presidential candidate
may be a little bit ahead of the time.
I think the displacements will happen,
but will they happen soon enough
for people to agree to vote for him?
The unemployment numbers are not very high yet.
And I think he and I have the same challenge.
If I want to theoretically convince people
this is an issue and he wants to become the president,
people have to see how can this be the case
when unemployment numbers are low?
So that is the challenge.
And I think I do agree with him on the displacement issue
on universal basic income at a very vanilla level.
I don't agree with it
because I think the main issue is retraining.
So people need to be incented
not by just giving a monthly $2,000 check or $1,000 check
and do whatever they want
because they don't have the know-how
to know what to retrain
to go into what type of a job
and guidance is needed.
And retraining is needed
because historically in technology revolutions
when routine jobs were displaced,
new routine jobs came up.
So there was always room for that.
But with AI and automation,
the whole point is replacing all routine jobs eventually.
So there will be fewer and fewer routine jobs
and AI will create jobs
but it won't create routine jobs
because if it creates routine jobs,
why wouldn't AI just do it?
So therefore the people who are losing the jobs
are losing routine jobs.
The jobs that are becoming available are non-routine jobs.
So the social stipend needs to be put in place
is for the routine workers who lost their jobs
to be retrained maybe in six months, maybe in three years.
It takes a while to retrain on the non-routine job
and then take on a job
that will last for that person's lifetime.
Now, having said that,
if you look deeply into Andrew's document,
he does cater for that.
So I'm not disagreeing with what he's trying to do.
But for simplification sometimes he just says UBI
but simple UBI wouldn't work.
And I think you've mentioned elsewhere
that the goal isn't necessarily
to give people enough money to survive or live
or even to prosper.
The point is to give them a job that gives them meaning.
That meaning is extremely important.
That our employment, at least in the United States
and perhaps it cares across the world,
provides something that's, forgive me for saying,
greater than money, it provides meaning.
So now, what kind of jobs do you think can't be automated?
You talk a little bit about creativity
and compassion in your book.
What aspects do you think it's difficult
to automate for an AI system?
Because an AI system is currently merely optimizing.
It's not able to reason, plan,
or think creatively or strategically.
It's not able to deal with complex problems.
It can't come up with a new problem and solve it.
A human needs to find the problem
and pose it as an optimization problem
then have the AI work at it.
So an AI would have a very hard time discovering a new drug
or discovering a new style of painting
or dealing with complex tasks
such as managing a company
that isn't just about optimizing the bottom line
but also about employee satisfaction,
corporate brand and many, many other things.
So that is one category of things.
And because these things are challenging, creative, complex,
doing them creates a high degree of satisfaction
and therefore appealing to our desire for working
which isn't just to make the money, make the ends meet
but also that we've accomplished something
that others maybe can't do or can't do as well.
Another type of job that is much numerous
would be compassionate jobs,
jobs that require compassion, empathy,
human touch, human trust.
AI can't do that because AI is cold, calculating
and even if it can fake that to some extent,
it will make errors and that will make it look very silly.
And also I think even if AI did okay,
people would want to interact with another person
whether it's for some kind of a service or a teacher
or a doctor or a concierge or a masseuse or a bartender.
There are so many jobs where people just don't want
to interact with a cold robot or software.
I've had an entrepreneur who built an elderly care robot
and they found that the elderly really only use it
for customer service and not,
but not to service the product
but they click on customer service
and the video of a person comes up
and then the person says how come my daughter didn't call me?
Let me show you a picture of a grandkids.
So people earn for that people, people interaction.
So even if robots improved, people just don't want it.
And those jobs are going to be increasing
because AI will create a lot of value,
16 trillion dollars to the world in next 11 years
according to PwC and that will give people money
to enjoy services, whether it's eating a gourmet meal
or tourism and traveling or having concierge services.
The services revolving around every dollar
of that 16 trillion dollars will be tremendous.
It will create more opportunities
that are to service the people who did well
through AI with things.
But even at the same time, the entire society
is very much short in need of many service oriented,
compassionate oriented jobs.
The best example is probably in healthcare services.
There's going to be two million new jobs,
not counting replacement,
just brand new incremental jobs in the next six years
in healthcare services.
That includes nurses, orderly in the hospital,
elderly care and also at home care.
It's particularly lacking.
And those jobs are not likely to be filled.
So there's likely to be a shortage.
And the reason they're not filled
is simply because they don't pay very well
and that the social status of these jobs
are not very good.
So they pay about half as much
as a heavy equipment operator,
which will be replaced a lot sooner.
And they pay probably comfortably
to someone on the assembly line.
And so if we ignoring all the other issues
and just think about satisfaction from one's job,
someone repetitively doing the same manual action
at an assembly line,
that can't create a lot of job satisfaction,
but someone taking care of a sick person
and getting a hug and thank you
from that person and the family,
I think is quite satisfying.
So if only we could fix the pay for service jobs,
there are plenty of jobs that require some training
or a lot of training
for the people coming off the routine jobs to take.
We can easily imagine someone who was maybe a cashier
at the grocery store,
as stores become automated,
learns to become a nurse or a at home care.
Also do want to point out the blue collar jobs
are going to stay around a bit longer,
some of them quite a bit longer.
AI cannot be told, go clean an arbitrary home.
That's incredibly hard,
arguably is an L5 level of difficulty, right?
And then AI cannot be a good plumber
because plumber is almost like a mini detective
that has to figure out where the leak came from.
So yet AI probably can be an assembly line
and auto mechanic and so on.
So one has to study which blue collar jobs are going away
and facilitate retraining for the people
to go into the ones that won't go away
or maybe even will increase.
I mean, it is fascinating
that it's easier to build a world champion chess player
than it is to build a mediocre plumber.
Yes, right, very true.
And AI and that goes counterintuitive
to a lot of people's understanding
of what artificial intelligence is.
So it sounds, I mean,
you're painting a pretty optimistic picture
about retraining about the number of jobs
and actually the meaningful nature of those jobs
once we automate the repetitive tasks.
So overall, are you optimistic about the future
where much of the repetitive tasks are automated,
that there is a lot of room for humans,
for the compassionate, for the creative input
that only humans can provide?
I am optimistic if we start to take action.
If we have no action in the next five years,
I think it's going to be hard
to deal with the devastating losses that will emerge.
So if we start thinking about retraining,
maybe with the low hanging fruits,
explaining to vocational schools
why they should train more plumbers than auto mechanics,
maybe starting with some government subsidy
for corporations to have more training positions.
We start to explain to people why retraining is important.
We start to think about what the future of education,
how that needs to be tweaked for the era of AI.
If we start to make incremental progress
and a greater number of people understand,
then there's no reason to think we can't deal with this
because this technological revolution
is arguably similar to what electricity,
industrial revolutions and internet brought about.
Do you think there's a role for policy,
for governments to step in to help with policy
to create a better world?
Absolutely, and the governments don't have to believe
an employment will go up
and they don't have to believe automation
will be this fast to do something.
Revamping vocational school would be one example.
Another is if there's a big gap
in healthcare service employment
and we know that a country's population
is growing older, more longevity living older
because people over 80 require five times as much care
as those under 80, then it is a good time
to incent training programs for elderly care,
to find ways to improve the pay.
Maybe one way would be to offer as part of Medicare
or the equivalent program for people over 80
to be entitled to a few hours of elderly care at home.
And then that might be reimbursable
and that will stimulate the service industry
around the policy.
Do you have concerns about large entities,
whether it's governments or companies
controlling the future of AI development in general?
So we talked about companies,
do you have a better sense that governments
can better represent the interest of the people
than companies or do you believe companies
are better at representing the interest of the people
or is there no easy answer?
I don't think there's an easy answer
because it's a double-edged sword.
The companies and governments can provide better services
with more access to data, more access to AI,
but that also leads to greater power
which can lead to uncontrollable problems
whether it's monopoly or corruption in the government.
So I think one has to be careful to look at how much data
that companies and governments have
and some kind of checks and balances would be helpful.
So again, I come from Russia.
There's something called the Cold War.
So let me ask a difficult question here.
Looking at conflict,
the Steven Pinker written a great book
that conflict all over the world is decreasing in general.
But do you have a sense that having written the book
AI Superpowers, do you see a major international conflict
potentially arising between major nations,
whatever they are, whether it's Russia, China,
European nations, United States or others
in the next 10, 20, 50 years around AI,
around the digital space, cyberspace?
Do you worry about that?
Is there something, is that something we need to think about
and try to alleviate or prevent?
I believe in greater engagement.
A lot of the worries about more powerful AI
are based on a arms race metaphor.
Metaphor and when you extrapolate into military kinds
of scenarios, AI can automate and autonomous weapons
that needs to be controlled somehow
and autonomous decision-making can lead to not enough time
to fix international crises.
So I actually believe a Cold War mentality
would be very dangerous because should two countries
rely on AI to make certain decisions
and they don't talk to each other,
they do their own scenario planning,
then something could easily go wrong.
I think engagement, interaction, some protocols
to avoid inadvertent disasters is actually needed.
So it's natural for each country to want to be the best,
whether it's in nuclear technologies or AI or bio,
but I think it's important to realize
if each country has a black box AI
and don't talk to each other,
that probably presents greater challenges to humanity
than if they interacted.
I think there can still be competition,
but with some degree of protocol for interaction.
Just like when there was a nuclear competition,
there were some protocol for deterrence
among US, Russia and China.
And I think that engagement is needed.
So of course we're still far from AI
presenting that kind of danger,
but what I worry the most about is the level of engagement
seems to be coming down.
The level of distrust seems to be going up,
especially from the US towards other large countries,
such as China and of course, and Russia, yes.
Is there a way to make that better?
So that's beautifully put, level of engagement
and even just basic trust and communication
as opposed to sort of,
making artificial enemies out of particular countries.
Do you have a sense how we can make it better?
Actionable items that as a society we can take on?
I'm not an expert at geopolitics,
but I would say that we look pretty foolish as humankind
when we are faced with the opportunity
to create $16 trillion for humanity.
And yet we're not solving fundamental problems
with parts of the world still in poverty.
And for the first time,
we have the resources to overcome poverty and hunger.
We're not using it on that,
but we're fueling competition among superpowers.
And that's a very unfortunate thing.
If we become utopian for a moment,
imagine that we're not solving
if we become utopian for a moment, imagine a benevolent
world government that has this $16 trillion
and maybe some AI to figure out how to use it
to deal with diseases and problems
and hate and things like that.
World would be a lot better off.
So what is wrong with the current world?
I think the people with more skill
than I should think about this.
And then the geopolitics issue
with superpower competition is one side of the issue.
There's another side which I worry maybe even more,
which is as the $16 trillion all gets made by US and China
and a few of the other developed countries,
the poorer country will get nothing
because they don't have technology
and the wealth disparity and inequality will increase.
So a poorer country with a large population
will not only benefit from the AI boom
or other technology booms,
but they will have their workers
who previously had hoped they could do the China model
and do outsourced manufacturing or the India model
so they could do the outsourced process or call center.
All those jobs are gonna be gone in 10 or 15 years.
So the individual citizen may be a net liability,
I mean, financially speaking to a poorer country
and not an asset to claw itself out of poverty.
So in that kind of situation,
these large countries with not much tech
are going to be facing a downward spiral
and it's unclear what could be done.
And then when we look back
and say there's $16 trillion being created
and it's all being kept by US, China
and other developed countries, it just doesn't feel right.
So I hope people who know about geopolitics
can find solutions that's beyond my expertise.
So different countries that we've talked about
have different value systems.
If you look at the United States,
to an almost extreme degree,
there is an absolute desire for freedom of speech.
If you look at a country
where I was raised that desire just amongst the people
is not as elevated as it is
to basically fundamental level
to the essence of what it means to be America, right?
And the same is true with China,
there's different value systems.
There is some censorship of internet content
that China and Russia and many other countries undertake.
Do you see that having effects on innovation,
other aspects of some of the tech stuff,
AI development we talked about
and maybe from another angle,
do you see that changing in different ways
over the next 10 years, 20 years, 50 years
as China continues to grow
as it does now in its tech innovation?
There's a common belief that full freedom of speech
and expression is correlated with creativity,
which is correlated with entrepreneurial success.
I think empirically we have seen that is not true
and China has been successful.
That's not to say the fundamental values are not right
or not the best,
but it's just that perfect correlation isn't there.
It's hard to read the tea leaves on an opening up or not
in any country and I've not been very good at that
in my past predictions,
but I do believe every country shares
some fundamental value,
a lot of fundamental values for the longterm.
So, you know, China is drafting its privacy policy
for individual citizens
and they don't look that different
from the American or European ones.
So people do want to protect their privacy
and have the opportunity to express
and I think the fundamental values are there.
The question is in the execution and timing,
how soon or when will that start to open up?
So as long as each government knows,
ultimately people want that kind of protection,
there should be a plan to move towards that
as to when or how, again, I'm not an expert.
On the point of privacy to me, it's really interesting.
So AI needs data to create a personalized,
awesome experience, right?
I'm just speaking generally in terms of products.
And then we have currently,
depending on the age and depending on the demographics
of who we're talking about,
some people are more or less concerned
about the amount of data they hand over.
So in your view, how do we get this balance right
that we provide an amazing experience
to people that use products?
You look at Facebook,
the more Facebook knows about you,
yes, it's scary to say,
the better experience it can probably create.
So in your view, how do we get that balance right?
Yes, I think a lot of people have a misunderstanding
that it's okay and possible to just rip all the data out
from a provider and give it back to you
so you can deny them access to further data
and still enjoy the services we have.
If we take back all the data,
all the services will give us nonsense.
We'll no longer be able to use products that function well
in terms of right ranking, right products,
right user experience.
So yet I do understand we don't want
to permit misuse of the data.
From legal policy standpoint,
I think there can be severe punishment
for those who have egregious misuse of the data.
That's I think a good first step.
Actually China in this side,
on this aspect has very strong laws
about people who sell or give data to other companies.
And that over the past few years
since that law came into effect,
pretty much eradicated the illegal distribution sharing
of data.
Additionally, I think technology is often a very good way
to solve technology misuse.
So can we come up with new technologies
that will let us have our cake and eat it too?
People are looking into homomorphic encryption,
which is letting you keep the data,
have it encrypted and train our encrypted data
of course we haven't solved that one yet,
but that kind of direction may be worth pursuing.
Also federated learning,
which would allow one hospital
to train on its hospitals patient data fully
because they have a license for that.
And then hospitals will then share their models,
not data with models to create a super AI.
And that also maybe has some promise.
So I would want to encourage us to be open-minded
and think about how to do that.
Open-minded and think of this
as not just a policy binary yes, no,
but letting the technologists try to find solutions
to let us have our cake and eat it too,
or have most of our cake and eat most of it too.
Finally, I think giving each end user a choice is important
and having transparency is important.
Also, I think that's universal,
but the choice you give to the user
should not be at a granular level
that the user cannot understand.
GDPR today causes all these pop-ups of yes, no,
will you give this site this right
to use this part of your data?
I don't think any user understands
what they're saying yes or no to.
And I suspect most are just saying yes
because they don't understand it.
So while GDPR in its current implementation
has lived up to its promise of transparency and user choice,
it implemented it in such a way
that really didn't deliver the spirit of GDPR.
It fit the letter, but not the spirit.
So again, I think we need to think about
is there a way to fit the spirit of GDPR
by using some kind of technology?
Can we have a slider?
That's an AI trying to figure out
how much you want to slide
between perfect protection, security of your personal data
versus a high degree of convenience
with some risks of not having full privacy.
Each user should have some preference
and that gives you the user choice.
But maybe we should turn the problem on its head
and ask, can there be an AI algorithm
that can customize this?
Because we can understand the slider,
but we sure cannot understand every pop-up question.
And I think getting that right
requires getting the balance
between what we talked about earlier,
which is heart and soul versus profit-driven decisions
and strategy.
I think from my perspective,
the best way to make a lot of money in the long term
is to keep your heart and soul intact.
I think getting that slider right in the short term
may feel like you'll be sacrificing profit,
but in the long term, you're beginning user trust
and providing a great experience.
Do you share that kind of view in general?
Yes, absolutely.
I sure would hope there is a way
we can do long-term projects
that really do the right thing.
I think a lot of people who embrace GDPR,
their heart's in the right place.
I think they just need to figure out
how to build a solution.
I've heard utopians talk about solutions
that get me excited,
but I'm not sure how in the current funding environment
they can get started, right?
People talk about,
imagine this crowdsourced data collection
that we all trust,
and then we have these agents
that we ask them to ask the trusted agent,
to that agent only, that platform.
So a trusted joint platform
that we all believe is trustworthy,
that can give us all the
closed loop personal suggestions
by the new social network, new search engine,
new e-commerce engine
that has access to even more of our data,
but not directly, but indirectly.
So I think that general concept
of licensing to some trusted engine
and finding a way to trust that engine
seems like a great idea,
but if you think how long it's gonna take
to implement and tweak and develop it right,
as well as to collect all the trusts
and the data from the people,
it's beyond the current cycle of venture capital.
So how do you do that is a big question.
You've recently had a fight with cancer,
stage four lymphoma.
And in a sort of deep personal level,
what did it feel like in the darker moments
to face your own mortality?
Well, I've been a workaholic my whole life,
and I've basically worked 9.96,
9 a.m. to 9 p.m. six days a week, roughly.
And I didn't really pay a lot of attention
to my family, friends, and people who loved me,
and my life revolved around optimizing for work.
While my work was not routine,
my optimization really made my life
basically a very mechanical process.
But I got a lot of highs out of it
because of accomplishments
that I thought were really important and dear
and the highest priority to me.
But when I faced mortality
and the possible death in matter of months,
I suddenly realized that this really meant nothing to me,
that I didn't feel like working for another minute,
that if I had six months left in my life,
I would spend it all with my loved ones,
and thanking them, giving them love back,
and apologizing to them
that I lived my life the wrong way.
So that moment of reckoning
caused me to really rethink
that why we exist in this world
is something that we might be too much shaped
by the society to think that success and accomplishments
is why we live.
But while that can get you
periodic successes and satisfaction,
it's really in the facing death,
you see what's truly important to you.
So as a result of going through them,
the challenges with cancer,
I've resolved to live a more balanced lifestyle.
I'm now in remission, knock on wood,
and I'm spending more time with my family.
My wife travels with me.
When my kids need me, I spend more time with them.
And before, I used to prioritize everything around work.
When I had a little bit of time,
I would dole it out to my family.
Now, when my family needs something,
really needs something,
I drop everything at work and go to them.
And then in the time remaining, I allocate to work.
But one's family is very understanding.
It's not like they will take 50 hours a week from me.
So I'm actually able to still work pretty hard,
maybe 10 hours less per week.
So I realized the most important thing in my life
is really love and the people I love.
And I give that the highest priority.
It isn't the only thing I do,
but when that is needed,
I put that at the top priority.
And I feel much better and I feel much more balanced.
And I think this also gives a hint
as to a life of routine work,
a life of pursuit of numbers.
While my job was not routine,
it wasn't pursuit of numbers,
pursuit of can I make more money?
Can I fund more great companies?
Can I raise more money?
Can I make sure our VCs ranked higher and higher every year?
This competitive nature of driving for bigger numbers
and better numbers became a endless pursuit
of that's mechanical.
And bigger numbers didn't really make me happier.
And faced with death,
I realized bigger numbers really meant nothing.
And what was important is that people who have given
their heart and their love to me
deserve for me to do the same.
So there's deep profound truth in that,
that everyone should hear and internalize.
And that's really powerful for you to say that.
I have to ask sort of a difficult question here.
So I've competed in sports my whole life,
looking historically,
I'd like to challenge some aspect of that a little bit
on the point of hard work,
that it feels that there are certain aspects
that is the greatest,
the most beautiful aspects of human nature
is the ability to become obsessed,
of becoming extremely passionate
to the point where yes, flaws are revealed
and just giving yourself fully to a task.
That is in another sense,
you mentioned love being important,
but in another sense,
this kind of obsession,
this pure exhibition of passion and hard work
is truly what it means to be human.
What lesson should we take as deeper?
Because you've accomplished incredible things.
You say it chasing numbers,
but really there's some incredible work there.
So how do you think about that?
When you look back in your 20s and 30s,
what would you do differently?
Would you really take back
some of the incredible hard work?
I would, but it's in percentages, right?
We're both computer scientists.
So I think when one balances one's life,
when one is younger,
you might give a smaller percentage to family,
but you would still give them high priority.
And when you get older,
you would give a larger percentage to them
and still the high priority.
And when you're near retirement,
you give most of it to them and the highest priority.
So I think the key point is not that
we would work 20 hours less for the whole life
and just spend it aimlessly with the family,
but that when the family has a need,
when your wife is having a baby,
when your daughter has a birthday,
or when they're depressed,
or when they're celebrating something,
or when they have a get together,
or when we have family time,
that it's important for us to put down our phone and PC
and be 100% with them.
And that priority on the things that really matter
isn't going to be so taxing
that it would eliminate
or even dramatically reduce our accomplishments.
It might have some impact,
but it might also have other impact
because if you have a happier family,
maybe you fight less.
You fight less, you don't spend time
taking care of all the aftermath of a fight.
So it's unclear that it would take more time.
And if it did, I'd be willing to take that reduction
and it's not a dramatic number,
but it's a number that I think would give me
a greater degree of happiness
and knowing that I've done the right thing
and still have plenty of hours
to get the success that I want to get.
So given the many successful companies
that you've launched
and much success throughout your career,
what advice would you give
to young people today looking,
or it doesn't have to be young,
but people today looking to launch
and to create the next $1 billion tech startup
or even AI-based startup?
I would suggest that people understand
technology waves move quickly.
What worked two years ago may not work today.
And that is very much case in point for AI.
I think two years ago or maybe three years ago,
you certainly could say,
I have a couple of super smart PhDs
and we're not sure what we're gonna do,
but here's how we're gonna start
and get funding for a very high valuation.
Those days are over because AI is going
from rocket science towards mainstream,
not yet commodity, but more mainstream.
So first the creation of any company
to eventual capitalists has to be creation
of business value and monetary value.
And when you have a very scarce commodity,
VCs may be willing to accept greater uncertainty.
But now the number of people who have the equivalent
of PhD three years ago,
because that can be learned more quickly,
platforms are emerging,
the cost to become a AI engineer is much lower
and there are many more AI engineers.
So the market is different.
So I would suggest someone who wants to build an AI company
be thinking about the normal business questions.
What customer cases are you trying to address?
What kind of pain are you trying to address?
How does that translate to value?
How will you extract value
and get paid through what channel?
And how much business value will get created?
That today needs to be thought about much earlier upfront
than it did three years ago.
The scarcity question of AI talent has changed.
The number of AI talent has changed.
So now you need not just AI,
but also understanding of business customer
and the marketplace.
So I also think you should have a more reasonable
evaluation expectation and growth expectation.
There's going to be more competition.
But the good news though, is that AI technologies
are now more available in open source.
TensorFlow, PyTorch and such tools are much easier to use.
So you should be able to experiment
and get results iteratively faster than before.
So take more of a business mindset to this.
Think less of this as a laboratory taken into a company
because we've gone beyond that stage.
The only exception is if you truly have a breakthrough
in some technology that really no one has,
then the old way still works.
But I think that's harder and harder now.
So I know you believe as many do,
that we're far from creating
an artificial general intelligence system.
But say once we do, and you get to ask her one question,
what would that question be?
What is it that differentiates you and me?
Beautifully put, Kaifu.
Thank you so much for your time today.
That was wonderful. Thank you.