"The exponential rise in “knowledge” and the increasingly distributed nature of work have increased the time needed to find existing knowledge. In other words, “searching for stuff” at work is fairly broken."

"As organizations become more distributed and knowledge becomes more fragmented, an intuitive work assistant like Glean is no longer a nice-to-have but a critical tool in driving employee productivity."

"Today, one of the key obstacles preventing enterprises from shipping AI applications to production is their inability to enforce appropriate governance controls (e.g., “Does my application understand what the end user is allowed to see and not see?”; “Is the inference done on my servers or OpenAI’s servers?”; “What source data led to a given model output and who owns it?”)."

"Data processing and annotation remain the most tedious and expensive part of the AI process but also the most important for quality outcomes. Even with the rise in pre-trained large language models, enterprises need to focus on using their proprietary data (across multiple modalities) to create production AI that leads to differentiated services, insights, and increased operational efficiencies."

"Traditionally, humans take days to complete a straightforward but time-consuming task like classifying e-commerce listings with multiple paragraphs of text. With GPT-4, however, that task can be performed within hours."

"as humans continue to innovate, they push the frontier of knowledge progressively farther out. Consequently, each successive generation takes longer to reach the frontier, requiring more education and training to get there. As argued by economist Benjamin Jones, this growing “burden” is slowing innovation, as great inventors have less time to innovate."

"Though there are innumerable reasons why the breakthroughs of the past 24 months are so startling, one of the most profound may be that AI feels no burden of knowledge."

"Humans are the only species that pass significant knowledge from generation to generation. We rely on the wisdom of prior ages and build upon it. Only by using this information, by “standing on the shoulders of giants,” can we “see further” and innovate. This mechanism is the essence of progress."

"Artificial intelligence, writ-large, does not suffer from the burden of knowledge. This technology does not die or degrade, it simply improves. Its relationship to knowledge acquisition raises profound questions: What will happen when it no longer needs us?"

"As artificial intelligence accelerates past us, it will accumulate knowledge we cannot comprehend."

"Knowledge is a mountain that we are trying to tunnel through. It does not matter that the mountain does not, cannot, end, that we will not break through limestone one day and luxuriate in the sunlight of omniscience. Some believe such things happen in death, but no one expects life to deliver them. Still, we dig."

"On a generational basis, animals make essentially no progress against the mountain of knowledge – they learn the same biological lessons over and over again."

"Infected with the drive for knowledge and advancement, humans have a different relationship with the mountain of knowledge. Generation after generation, we tunnel further, learning more. We also tunnel differently: first, we used our hands, then a stick, then a tool, and now we sit on a rumbling chair, directing a vast and spinning drill."

"“If I have seen farther, it is by standing on the shoulders of giants.”"

"Jones documents the result of this: the age at which notable inventions occur is significantly increasing. In 1900, for example, the peak ability to generate a great invention occurred at roughly 30 years old. By 2000, it had risen to nearly 40."

"The more time it takes someone to reach the end of the tunnel, the less time they have to actually dig."

"Because it does not die, there is no lag in reaching the rockface. Because it does not degrade, its digging does not slow. As our efforts decelerate, the Encephalon’s accelerate, and when it no longer needs us, it will be fully loosed in the mountain of knowledge, speeding ahead, leaving an ever-expanding gap between us and it."

"No matter how complete your methodology or rigorous your training, you will not succeed in teaching a toad Archimedes’ principle, even as he plops into the water. In computing terms, these creatures are hardware-constrained, limited by their processing power. The Encephalon puts us in a similar position. We may become secondary creatures, incapable of understanding the world we live in, even as we reap its benefits. In such a configuration, we are the happy, wall-licking shih-tzu benefiting from central heating, ready food, and mesmerizing toys without grasping how they have arrived."

"Durability is the greatest discrepancy now, but it will not be for long. Soon, we will be less capable, too. For a time, the wonders the Encephalon reveals could accelerate our learning, our tunneling; but without ancillary support, we will be outmatched."

"Seven research studies reveal the people, incentives, and environments that create innovation."

"Tolerating failure. To foster a creative environment, you must make yourself comfortable with failure. A 2009 study demonstrates the impact of incentivizing experimentation among life scientists. When funded by a more permissive, long-term-minded grant, scientists achieved breakthrough innovations at much higher rates than peers receiving stricter grants."

"The novice can often find solutions to which the expert is blind. A 2014 paper suggests that’s more than just rhetoric. When prompted to develop novel ideas, the study found that those with the least overlapping expertise were most ingenious."

"Those that position themselves near “structural holes,” gaps in an organization’s network, tend to be especially creative. By connecting disparate groups, these “brokers” become sources of ingenuity."

"An analysis of 11,000 research scientists found a connection between creative output and the reasons individuals chose their current role. Those that optimized for salary or job security were less innovative than scientists motivated by independence or the desire for an intellectual challenge."

"To build a creative environment, incentivize long-term thinking and experimentation. Making room for failure opens the door to much greater success."

"Interestingly, the greater the distance the participant had from the target problem, the more novel their ideas."

"Novelty does come at a cost, however. Though outsiders’ solutions might be more creative, experts found them less immediately useful."

"“The ground zero of innovation was not at the microscope. It was at the conference table.”"

"In his 1995 study, “How Scientists Really Reason,” Dunbar highlights how prompting a colleague to reframe their work at a different “level” can unlock new reasoning"

"those with lower network constraint scores were more likely to receive positive performance reviews, promotions, and higher salaries. Though traditional corporate cultures often overly encourage operators to focus on narrow execution, brokers are the ones that reap the rewards."

"effort and innovative production were much more correlated with intrinsic motivators. R&D scientists who chose their positions because they provided more independence and fulfilled their curiosity worked more hours and had more patents to show for it."

"First, innovators are not born at the frontier of knowledge; rather, they must initially undertake significant education. Second, the frontier of knowledge shifts over time."

"New business models gain traction. The last generation of companies relied on advertising above all else. Startups increasingly ignore that money spigot in favor of subscriptions, in-app payments, or e-commerce. On a small scale, several of these experiments look promising."

"In ten years, speaking to AI friends at least as often as to human ones may be normal. That could reduce our desire to use social networks to find online kinship."

"“The price of anything is the amount of life you exchange for it,” philosopher Henry David Thoreau said."

"A new wave is emerging to meet this opportunity. Upstarts like BeReal, Poparazzi, Mastodon, Post News, and others seek to win by promising a better use of our most valuable resource: time."

"If you think of social media as a spectrum – from social to media – all of these companies are shifting toward the latter end."

"In the U.S., traditional media has increasingly pushed toward the poles. A Pew Research study from 2019 illustrates how partisan American news consumption is. Ninety-three percent of those who selected Fox as their main source of news identified as Republican, while 95% of those that chose MSNBC considered themselves Democrats. The information we consume reflects our political affiliations to an extreme extent."

"Subscriptions and in-app payments may better suit the hit-driven nature of social media companies."

"Traditionally, social media companies have forgone early monetization so as not to inhibit growth, but it may be worth adding some degree of downside protection. Offering a paid product means that even if your app is little more than a summer fad, the exercise has not been fruitless, potentially producing millions in revenue."

"As TikTok has already shown, there’s an opportunity for social networks to act as the gateway to e-commerce."

"A relentless march towards richness.  Economies replacing advertising.   The rise of synthetic kinship."

"Social media may also take inspiration from immersive games on the business model side. Platforms like Roblox have demonstrated the power of running in-world economies. Rather than leveraging ads, Roblox monetizes via avatar accessories, game upgrades, or other special experiences."

"The next generation of social media giants may not obsess over capturing attention. Instead, they’ll focus on creating functional, multifaceted economies."

"Fundamentally, we seek out those platforms to connect. Humans crave kinship, a sense of belonging with a larger group. Right now, that can only be sated by interacting with other humans. Very soon, though, that may no longer be true."

"Though dystopian, it seems eminently plausible that humans may have dozens of synthetic friends and loved ones in future decades. We will talk and play and share with these creations as we do today."

"Instead of connecting with one another (or pretending to), we might live in private versions of The Truman Show, with AI playing the other characters."

"AI could be used to bootstrap new social experiences. The founders of future platforms may solve the cold start problem by generating billions of synthetic personalities to interact with human participants. Even a network with a few hundred “real” users could be made to feel active in this way; the lines between human and artificial people will become increasingly blurry."

"Fundamentally, Substack exists to defray infrastructure costs for publishers, make it easier for them to build their businesses, and drive them to new heights."

"it’s a network in which publishers collaborate, helping one another at least as much as they vie for attention."

"I’ve always thought that what you read matters"

"The challenge of writing about a problem everyone understands is that simply restating the issue is not enough."

"The fundamental problem, Best suggested, was contemporary media’s business model. Increasingly, publishers and platforms earned their money through advertising, making companies their real customers – not readers."

"To McKenzie and Best, the answer seemed simple: subscriptions. Instead of indirectly monetizing through advertising, digital publishers would be paid directly by readers – patronage, renovated for the software generation."

"“We hypothesized that [most writers] don’t have the business sense or entrepreneurial urge or tech-savvy,” McKenzie said. “And even if they could, it’s a lot of work.”"

"What modern media companies needed, the duo decided, was a simple way to solicit and manage subscriptions – a subscription stack, if you will."

"The right infrastructure was undoubtedly pivotal, but the real prize came after a significant number of independent publications operated within a shared ecosystem."

"The right infrastructure was undoubtedly pivotal, but the real prize came after a significant number of independent publications operated within a shared ecosystem. Best and McKenzie knew that was the foundation for a network – one in which media companies might collaborate and interact, helping one another grow. As that happened, the underlying product could become a platform in its own right."

"Over the succeeding two and half years, the platform has expanded subscriptions by a compound annual growth rate (CAGR) of 136%."

"Substack had crossed 2 million paid subscriptions and more than 20 million monthly readers."

"In 2019, Andreessen Horowitz’s (a16z) Andrew Chen led a $15.3 million Series A investment into McKenzie, Best, and Sethi’s platform. Two years later, a16z doubled down on its investment, leading a $65 million Series B. That round valued Substack at $650 million."

"For Chen, Substack was a category-bending, n-of-1 business. Not only was it growing rapidly, it had amassed extraordinary cultural power in a short amount of time."

"The company’s product matured by leaps and bounds in 2022. Visual improvements, a mobile app, video support, a stronger editor, upgraded podcast functionality, discussion threads, a revamped web reader, mentions, chat, and, of course, recommendations all emerged last year. “The amount of stuff they’ve shipped in the last 12 months has been super, super impressive,” Andrew Chen noted."

"At its most fundamental level, Substack is a tool. Writers use it to email their readers, publish posts online, and accept subscription payments. Do not let the seeming simplicity of these tasks fool you. It is not easy to do any of these things well: emails are easily waylaid, content is hampered by ugly interfaces, and purchases flounder on ill-designed checkout pages."

"Substack isn’t just a place to publish or read – it’s an ecosystem for writers and creators to collaborate and contribute to one another’s growth."

"“When you’re subscribing to a writer, it’s not just because you want their email in your inbox; you want their thoughts to shape your worldview.”"

"Substack’s dashboard has a neat, somewhat hidden page that details audience demographics and the amount of overlap your publication has with others. For example, The Generalist has a 9% overlap with Not Boring and an 8% overlap with Lenny’s Newsletter. It’s easy to imagine how this data might prompt new collaborations and partnerships."

"Newsletter businesses are different. Because email addresses are portable, you take your audience with you. If a tool or network is no longer serving the company, you can make a change"

"The stronger the tool becomes, the more writers come aboard. The more writers that join, the more robust the network becomes. The more powerful the network becomes, the more compelling a destination Substack is. And the better the destination is, the more readers come aboard and discover writers."

"Though Substack’s cut might sound expensive, it’s rather economical relative to other platforms that drive revenue for underlying businesses. Video platforms like YouTube and Twitch take as much as 50%, Apple’s App Store famously takes up to 30%, and OnlyFans clips 20%. Patreon – which acts less like a destination and charges subscription fees – costs 5-12%."

"it seems reasonable to value Substack’s revenue like a B2B SaaS company"

"“It’s not like we never think about other revenue options. And there are ongoing discussions about what else we could do,” McKenzie said. “[But] in my mind, ads and subscriptions do conflict with each other, or at least introduce conflict.”"

"the best way to promote the conference is by sending an email to subscribers. That’s not bad, but Substack could go further, adding an “Events” tab to its web and mobile apps, making it easier to buy tickets and RSVP. The same principle could guide the creation of a library of e-books, a collection of job posts, or a selection of paid courses."

"Today, Substack is known as the newsletter platform. In three years, that may no longer be the case. Substack’s goal is to be the best place to build a media business, no matter your preferred content type."

"The platform can also take steps to lower the barrier to creation – perhaps with the help of AI. As outlined in “Endless Media,” generative AI engines like Midjourney and ChatGPT are fundamentally disrupting how we create content, making it considerably easier to conjure compelling imagery and passable written text."

"Netscape CEO Jim Barksdale: “There are only two ways to make money in business: One is to bundle; the other is unbundle.”"

"“We’re only in the early innings of the cultural significance of Substack,” Andrew Chen said. “There’s going to be new buzzwords and terminology [that comes from it]...the same way that gamer terminology that becomes mainstream originates on Reddit and Discord.” It is a modern salon, a place to converse, collaborate, and create."

"Substack is not a publisher nor a simple tool. It is a network, an ecosystem, an engine alive with word and culture and thought; an empire of narratives."

"In the next generation of AI startups, the best products will be created by founders who focus on workflow design and fine-tuning models based on user feedback."

"The founders who win will design interfaces and workflows that give users high levels of control and low cognitive overhead by innovating on top of the current prompting and auto-complete modalities."

"Trend: Come for the workflows, stay for the personalization"

"Startups will leverage the latest advances in AI research by swapping in new models as they become available and fine-tuning based on historical proprietary user feedback."

"Moats will be in the comprehensive workflows and data collected as users engage with these models, which will inform more powerful future models."

"Do the hard things. To build a great startup, you have to move fast. But you shouldn’t let urgency distract you from tackling big, thorny problems. Doing the hard things is one of the most effective ways to build true defensibility."

"Protect your principles. Having clear company principles helps your team make faster, better decisions. It’s easier to act autonomously when you have a clear framework to follow. Failing to protect these values can shift your company towards an “exception-based” culture."

"As a CEO, you want to build a company that tackles really, really hard problems head-on – even if they take more time."

"Doing the hard things pays dividends in the long run."

"focus is everything"

"as Leif Abraham said, having focus doesn’t mean saying no to bad ideas; it’s saying no to ideas you think are exciting, high-potential, and easily justifiable – and doing so because you don’t want to give even 0.1% less to your existing business. Focus should be painful."

"a small number of products will drive nearly 100% of the value. Spend your time and resources on the places it matters most."

"Violating your company’s values comes at a high cost. While you might get away with a couple of transgressions, over time, you create a different culture than the one you intended to."

"whenever you’re tempted to act against your company’s principles for expediency’s sake, recognize what you’re risking."

"hiring someone that’s only a partial fit creates an organizational debt that has to be paid off at some point. And, like financial debt, the longer you leave it, the larger your bill can grow and the less flexibility you’ll have in the future."

"If they’re not the right fit, there’s a good chance that rather than solving your problem, they’ll end up creating a dozen new ones. Digging your way out might involve unwinding the entire team."

"It’s not enough to have a 10x better product. If you’re trying to build an epic consumer business, you also need an exceptional brand. This becomes increasingly important over time as competitors recognize the opportunity in your space and as you expand beyond your core customer demographic."

"Our ultimate promise to consumers was that we provided the best service because we cared – about the country we were from and the people that worked on the platform."

"transparency has helped us build trust with them and, by extension, our customers."

"Be a painfully persistent recruiter (Stripe)"

"Patrick notes that “the biggest thing we did differently...is just being ok to take a really long time to hire people.” It took the company six months to hire its first two employees. Describing their “painfully persistent” process of recruiting in his conversation with Lilly, Patrick noted that he could think of five employees that Stripe had taken three or more years to recruit."

"Every successful company cares about serving its customers to some extent, but very few are genuinely obsessed with pleasing them in that word’s truest meaning. Those who embrace such devotion are rewarded with stronger customer affinity and better retention."

"To please your customers, you must obsess over them."

"Charlie Munger once said, “Never, ever, think about something else when you should be thinking about the power of incentives.” When it comes to organizing your company, optimizing performance, and capturing the upside, there’s no better place to begin than with the underlying incentives."

"The tendency to view one’s work at a state or civilizational level may sound grandiose, but in many instances, it offers the aptest comparison and clearest lessons. As tech insinuates itself into every aspect of our lives, companies and protocols act as pseudo-nation states with enormous impact and broad scope."

"With online marketing saturated, finding innovative ways to advance a story of one’s making is likely to become increasingly valuable and a critical source of differentiation."

"OpenSea’s leadership followed an astute strategy: they preserved optionality on multiple levels. Firstly, the team kept burn low, bringing in money through fees. Doing so freed Finzer and Atallah from continuously fundraising and gave them the time for the market to mature."

"More importantly, OpenSea built optionality into its product. Rather than concentrating on owning a particular use-case, the team designed the platform to host the long-tail of assets."

"Great businesses often don’t try to do everything. Rather than splitting their energies, they focus on how they can intensify their most pronounced advantage."

"Tiger follows an axially different method. The firm outsources its diligence to consulting firm Bain. Tiger can focus on its greatest strengths by taking this tact: moving quickly and relying on an encyclopedic knowledge of successful business models to pick winners."

"Red Bull does something similar. The company outsources the production of its beverages to focus entirely on marketing."

"To win, find ways to deepen your advantages, even at the cost of outsourcing commoditized operations."

"Sometimes, the best marketing strategy is to define yourself by what you’re not."

"Throughout Telegram’s journey, the company has defined itself as a kind of Not-Facebook: a user-friendly private alternative to Big Blue’s surveillance state. Such counter-positioning was made more effective once WhatsApp was brought into Zuckerberg’s fold, allowing Durov to extend the same argument to his most direct competitor."

"Great businesses never sit still. They are constantly in a state of reinvention and internal bottoms-up disruption. Doing so not only opens new opportunities but protects against competitive displacement."

"“Ideas are cheap and abundant,” the management expert said, “What is of value is the effective placement of those ideas into situations that develop into action.”"

"Across academia and industry, plenty of fine thinkers have made equivalent statements, arguing that real value resides in effective implementation, not ideation. The prolific executive brings most value to the world, this thesis goes, rather than the unproductive theorist."

"Compared to the 1970s, 18x more researchers are needed to continue its trajectory, with productivity slipping."

"1. Good incentives"

"Incentives are the friend of the wise man and enemy of the fool."

"While the snake population fell in the short term, enterprising locals quickly found a loophole in the British plan. Rather than killing the remaining snakes – an uncertain enterprise with diminishing returns – they could simply breed more snakes, delivering their bodies for a steady income."

"The NIH has short review cycles and a strong emphasis on concrete deliverables. Meanwhile, the HHMI is minded toward the long-term, with a higher tolerance for failure and a preference for experimentation. Unlike the NIH, it funds “people, not projects.”"

"It may not surprise you to hear that recipients of HHMI grants were found to be considerably more innovative. They published more, higher-quality papers over the course of their careers."

"Authors Tian and Wang found that IPO’ing companies backed by “failure-tolerant” venture capitalists are better innovators, producing more patents."

"2. Outsiders"

"The team found that those from “analogous markets” were significantly better at generating original ideas."

"When faced with a problem that requires novelty, don’t simply ask your peers or industry experts: find someone from an analogous market that brings a beginner’s mind to the problem."

"3. Collaboration"

"Renowned anthropologist Margaret Mead described her craft as the practice of “record[ing] in astonishment and wonder that which one would not have been able to guess.”"

"Contrary to the stereotype that breakthroughs occur thanks to the spontaneous brilliance of a solitary genius, Dunbar found they happened during weekly lab meetings."

"4. Superstars"

"To measure creative output, researchers focused on the number of articles collaborators co-authored after a superstar’s death, factoring in the impact of the journals in which they featured. The study found a “sizable and significant” decrease of 8.8% in output by this measure."

"As the study remarks, “It is the star’s citation impact that matters in shaping collaborators’ post-extinction outcomes, rather than his/her control over a funding empire.”"

"5. Brokers"

"A structural hole is a gap in the network structure of an organization or market"

"Burt found that managers with less constrained networks provided better quality ideas than those with constrained networks."

"This pattern holds even when looking at managers in the “top-ranks” – a high-level manager with a redundant informational network delivered weak ideas."

"Interestingly, those spanning structural holes were much more likely to discuss their ideas, allowing them to be debated, improved, and implemented."

"Finally, Burt found that those with lower network constraint scores were more likely to receive positive performance reviews, promotions, and higher salaries."

"If you want to increase the quality of your ideas, find a structural hole, and make it your own."

"6. Intrinsic motivation"

"Scientists motivated by a high salary worked fewer hours, albeit only in one subgroup of the sample. Subjects motivated by job security tended to have lower creative output."

"If you want to build a team of high effort and innovativeness, offering a genuine intellectual challenge may be more important than upping the position’s salary."

"7. Elders"

"“First, innovators are not born at the frontier of knowledge; rather, they must initially undertake significant education. Second, the frontier of knowledge shifts over time.”"

"In 1900, the peak ability to generate a great invention arrived at approximately 30 years old; by 2000, it was nearly 40."

"Because inventors don’t make up for their late start with greater productivity in middle age, their “life-cyclical innovation potential” has declined by 30%."

"The heart of progress. Humans are the only species that pass significant knowledge from generation to generation. We rely on the wisdom of prior ages and build upon it. Only by using this information, by “standing on the shoulders of giants,” can we “see further” and innovate. This mechanism is the essence of progress."

"The burden of knowledge. Humans are not born at the “frontier” of knowledge; it takes us time to reach it. As we push the frontier further out, reaching it takes successive generations longer. Economist Benjamin Jones refers to this as the “burden of knowledge.” The more we know, the more the next generation must learn to contribute at the cutting edge."

"Its relationship to knowledge acquisition raises profound questions: What will happen when it no longer needs us?"

"How do you resolve the impending gap between humans and artificial intelligence?"

"Knowledge is a mountain that we are trying to tunnel through. It does not matter that the mountain does not, cannot, end, that we will not break through limestone one day and luxuriate in the sunlight of omniscience."

"The act of learning, of digging against the mountain of knowledge, varies by organism and maturity."

"Humans are unique. We are equipped with larger, higher-performance brains and, because of this, find ourselves driven by different ambitions and ideologies, the desire for progress, for example."

"On a generational basis, animals make essentially no progress against the mountain of knowledge – they learn the same biological lessons over and over again."

"Over time, humanity’s tunnel through the mountain of knowledge has grown long, and that introduces a problem."

"Three hundred years ago, a ferociously intelligent, well-trained person might be ready to contribute in their twenties, sometimes younger."

"The economist Benjamin Jones refers to this malady as “the burden of knowledge.” As we learn more and more, our burden grows; as the tunnel stretches farther and farther, it takes more time to reach its present terminus."

"Not really – mostly because we have the bad habit of degrading and, eventually, dying."

"In particular, they have many fewer “peak” years during which they might make a groundbreaking discovery; longer life expectancies don’t solve this problem since the geriatric do not tend to be a fecund source of innovation."

"By Jones’ estimation, the growing burden of knowledge has resulted in a 30% decline in “life-cyclical innovation potential.”"

"The Encephalon has many such peculiarities but chief among them is the fact that it does not degrade and it does not die."

"do you fear the drill will overtake us, too? Will we live beneath the rule of a thinking hammer?)"

"Because it does not die, there is no lag in reaching the rockface."

"One of the implicit agreements a society makes is that no one needs to know everything."

"“If we are unable to fathom the logic of each individual decision, should we implement its recommendations on faith alone?”"

"In his landmark essay, “What Is It Like to Be a Bat?” philosopher Thomas Nagel argues that grasping another conscious animal’s sense of being is fundamentally impossible."

"What are we to do? Can humans hope to maintain primacy as the mountain’s most knowledgeable species?"

"Returning to a computing framework, humans have several deficiencies compared to a future-stage Eternal Encephalon."

"Durability is the greatest discrepancy now, but it will not be for long. Soon, we will be less capable, too."

"So enter the likes of Neuralink. Such brain-computer interface makers dream that they will not only resolve deficiencies but reduce lag and unleash new brilliance."

"“Fable” is an interesting, intricate word. As a noun, it is a story, usually involving animals, dictating a lesson."

"Last year the losses to scams and fraud increased by 70%. Businesses don’t realize they have a fraud problem until they see users they thought were “verified” scamming them."

"Either these startups will play the same game as the last generation, looking for the most efficient way to gobble up time and monetize it through advertising, or they will embrace alternatives."

"Focusing on close friends."

"Counterpositioning on ethical or political grounds."

"Moving beyond advertising."

"Winning the next great use case."

"On Locket, users push an image directly to a friend’s home screen, which appears in a widget."

"Gas, acquired by Discord earlier this week, takes a different approach in pursuing a similar goal."

"Slay offers similar functionality for the European market. Other riffs on the “compliments app” include Sendit, NGL, and nocapp."

"The focus is not on building a media machine but on a network for close ties."

"Mastodon reportedly poached more than 2 million from Twitter, though the company has chosen to forgo investment to retain non-profit status."

"For users of these platforms, Twitter is a product with an agenda, an agent of leftist censorship."

"In sum, both sets believe they are creating the platform for true free speech, but they look to find it in opposite directions."

"The information we consume reflects our political affiliations to an extreme extent."

"The same fragmentation may occur across social media. Rather than assembling on a single unified platform like Twitter, users may increasingly fragment across several, each catering to a different worldview."

"Gas is a good example. Since its launch last summer, the app reportedly pulled in $7 million in revenue. That arrived thanks to its subscription, “God Mode,” which allows users to see who voted for them in different polls."

"Yubo, a live-streaming network with 40 million users, also has a subscription product that management expects to produce $20 million in revenue in 2023."

"Turner Novak, founder of Banana Capital and writer of The Split, highlighted fashion-focused Teleport as a promising company from his portfolio."

"It is leveraging a revenue model that riffs on this theme. “It’s an app to post a video of your outfit each day,” Novak noted. “It’s incredibly simple to create a video, the content is centered around sharing outfit inspiration, and every video is shoppable. This leads to natural opportunities for Teleport to generate revenue by facilitating commerce.”"

"The final strategy social media upstarts deploy is trying to win the next great use case."

"A relentless march towards richness.  Economies replacing advertising.   The rise of synthetic kinship."

"“Immersive worlds feel like a natural next step,” Woodbury said, highlighting Minecraft and Roblox as models for future experiences. While the Index partner notes these could take place in the browser, they could eventually become fully-fledged VR or AR ecosystems."

"However, the wisdom of their investments in VR and AR will come down to the manner and timing in which immersive worlds manifest for the mainstream."

"Platforms like Roblox have demonstrated the power of running in-world economies. Rather than leveraging ads, Roblox monetizes via avatar accessories, game upgrades, or other special experiences."

"Already, AI has matured to a point where it is possible to have a meaningful relationship with it. One of The Generalist’s first-ever pieces outlined how dating was “scaling beyond the human.”"

"Romantic chatbots like those offered by Replika are more than simple time-fillers; they are synthetic partners that people form genuine attachments to."

"“The future is here — it’s just not evenly distributed.”"

"Though dystopian, it seems eminently plausible that humans may have dozens of synthetic friends and loved ones in future decades."

"A big launch. Apple is expected to launch its augmented reality (AR) headset this year."

"Giants show weakness. The last decade of the internet has been dominated by advertising giants like Google and Facebook. In 2023, we might see both of them challenged more aggressively. AI is opening up the search design space, while the combined frailty of social media’s giants leaves room for challengers."

"China’s chips. Toward the end of last year, the U.S. made its most aggressive move yet to curtail China’s access to high-end semiconductors. Thus far, the response has been muted, but in 2023, we should get a sense of how Xi Jinping will seek to ensure access to this critical technology."

"New rules. A caveman’s summary of 2022 might be something like, “AI: good. Crypto: bad.” Indeed. If crypto wishes to avoid similar catastrophes in the future, regulation is necessary. Even with a divided Congress, the U.S. can take steps to implement better rules."

"Lenin’s maxim about time and history is often repeated: “There are decades where nothing happens; and there are weeks where decades happen.”"

"Augmented reality (AR) has been heralded as the next great computing platform for some time."

"And yet, despite its pervasiveness, AR feels rather insignificant."

"It’s unlikely to be a mass-market hit: there will be undoubted kinks to work out, and the expected $3,000 price point makes it a luxury purchase."

"most opinionated consumer hardware manufacturer considers the optimal approach."

"If the headset proves even a modest success, I expect we’ll see a sharp uptick in venture for companies in the sector and an influx of new entrepreneurs. Though AR is no stranger to a hype cycle, the presence of dedicated Apple hardware could make a meaningful difference in adoption."

"I don’t think we’re close to the top of this AI hype cycle. The speed of innovation – and the impending reveal of GPT-4 – will feed further frenzy."

"I suspect AI investing will have an especially low hit rate in the short-to-medium term. In large part, I think that’s because investors are mostly punting on a fundamental question: how do generative AI companies create defensibility?"

"Many of the sector’s fastest-growing and best-capitalized businesses derive the majority of their value from publicly available AI models."

"Many successful companies do not have technological advantages. Indeed, as OpenAI’s Sam Altman remarked in response to a question about Jasper’s defensibility, few Silicon Valley businesses have a tech moat."

"They do, however, have many other forms of defensibility: distribution advantages and network effects, for example."

"For now, it is representative of many players in the space: thin-product layers sitting atop powerful, external models."

"How do VCs underwrite companies with high-potential but fragile value propositions?"

"We have not seen such collective vulnerability in the better part of a decade."

"Meta is burning money on its legless metaverse; Snap has struggled to turn attention into revenue; TikTok is a geopolitical nightmare already banned in India and perhaps on its way out of the U.S"

"But the rise of insurgents like BeReal, Mastodon, Poparazzi, Locket, Post, Hive, Fizz, and others suggests consumers are willing to jump ship."

"The challenge for these startups will be converting their novelty into an enduring user base."

"Advertising was the lifeblood of the last generation, but there’s a feeling that it's no longer as economically or socially attractive."

"The introduction of Twitter Blue and Snapchat Plus illustrates that even big players are thinking about subscriptions as a source of supplementary revenue, but shifting the center of gravity at either company looks unlikely."

"Though products like ChatGPT are still limited and Google has formidable distribution advantages, new AI models open the door for competition."

"It will be interesting to see how, exactly, insurgents leverage these budding technological capabilities."

"As we outlined in our piece on TSMC, semiconductors are one of humanity’s most complicated creations. They are also among the most geopolitically important. Control over their production is a strategic priority and flash point between the U.S. and China."

"In October 2022, President Biden severed China’s access to leading-edge chips and the tools needed to make them. It is the U.S.’s most aggressive maneuver to date and could prompt a reaction."

"The absurd difficulty of advanced chip manufacturing means any such investment would take years – if not decades – to bear fruit."

"One possibility is that China focuses on producing lower-end chips. By increasing supply and subsidizing manufacturers, the country could effectively undercut Western providers in this segment. In time, that may result in even American-allied businesses purchasing low-end chips from China, creating leverage."

"FTX, Terra, 3AC and other collapses revealed the sheer extent of fraud, speculation, and unethical behavior that besets the sector. I suspect we’ll see plenty of continued fallout from these debacles in 2023."

"Crypto is at a crossroads. In the parlance of Carlota Perez, we might consider it the industry’s “turning point” – the key period in which a promising technology makes necessary changes to reach mainstream adoption or dies on the vine."

"Crypto badly needs regulation. There will be no “deployment phase,” no widespread adoption, without better rules."

"Saying we need to keep customer funds safer is one thing – finding the right legislation is altogether harder. Just as there’s a risk in doing nothing, there’s also plenty of jeopardy in doing too much. Innovation requires some latitude."

"Given the global nature of crypto, international policies may prove most impactful. As president of the G-20 for the year, India is said to be prioritizing collaboration over crypto rules."

"In December 2021, Electric Capital released its Developer Report. Data from 500,000 code repositories suggested that crypto had roughly 19,000 monthly active developers."

"For all its flaws, crypto is a hardy industry. It has weathered plenty of shocks before, and pullbacks like this one often strengthen the resolve of those that remain. I’m optimistic that a less chaotic market will allow pragmatic founders to build meaningful products in the space over the next twelve months and beyond."

"Attracting exceptional people is a startup’s most important task outside of finding product-market fit."

"More than any particular stratagem or scheme, the most effective way to hire extraordinary people is to be so persistent it hurts."

"It took the company six months to hire its first two employees."

"To do this, Levels makes several atypical decisions, including actively discouraging tools like Slack and meetings. These restrictions aim to create a business that runs asynchronously, reducing interruptions and protecting unbroken deep work."

"When it comes to organizing your company, optimizing performance, and capturing the upside, there’s no better place to begin than with the underlying incentives."

"In Ravikant’s view, it is preferable to have a team focused on a narrower problem for which their efforts are directly rewarded."

"Do Kwon often talks about Singapore. The founder of crypto project Terra takes inspiration from the creation of the Asian republic and how prime minister Lee Kuan Yew fostered prosperity."

"Entering the American market late, the cryptocurrency exchange has sought to capture attention and influence by partnering with beloved sporting institutions, buying the naming rights to the Miami Heat’s arena, and sponsoring MLB uniforms."

"Devin Finzer and Alex Atallah founded OpenSea when NFTs were scarcely a blip on the world’s radar."

"Given those conditions, OpenSea’s leadership followed an astute strategy: they preserved optionality on multiple levels. Firstly, the team kept burn low, bringing in money through fees. Doing so freed Finzer and Atallah from continuously fundraising and gave them the time for the market to mature."

"More importantly, OpenSea built optionality into its product. Rather than concentrating on owning a particular use-case, the team designed the platform to host the long-tail of assets. Again, this was a sharp move."

"Throughout Telegram’s journey, the company has defined itself as a kind of Not-Facebook: a user-friendly private alternative to Big Blue’s surveillance state."