Keep pulling the thread on Sarah Guo.
Gagana and Sierra are examples of companies leading a business model shift in customer support from per-seat software to utilization-based AI agents.
Some AI-native companies in Sarah Guo's portfolio with over $100 million in revenue operate with fewer than 50 engineers while employing close to 100 salespeople.
Managing human attention and ensuring code quality in an environment of abundant AI-generated code is a major unsolved problem, presenting a market opportunity for companies like Jira or new startups.
AI labs are growing from $1 billion to $10 billion in revenue in approximately one year, a pace significantly faster than previous tech cohorts like Google and AWS (3-5 years), Salesforce (8-9 years), and Adobe (around 20 years).
Public projections estimate that leading AI labs could grow from $10 billion to $100 billion in revenue in just 3-5 years, a timeframe much shorter than it took Microsoft (27 years) or Google and AWS (over a decade).
The cost for one million tokens from a GPT-4-equivalent model dropped by a factor of 150x, from approximately $37 to $0.25, in a 21-month period.
The cost for one million tokens on an 'O1 equivalent' model dropped by 88x, from approximately $26 to $0.30, in just 11 months.
The top eight U.S. technology companies now have a combined market capitalization of approximately $23 trillion and represent over 50% of the S&P 500's value.
The U.S. technology sector's share of the nation's GDP has grown from approximately 4% in 2005 to about 12% today.
Elad Gil predicts that the technology sector's share of U.S. GDP could reach between 15% and 30% by 2035, driven by AI converting services and jobs into tech spending.
The current AI market, with its rapid growth and leadership turnover, is more analogous to the volatile internet era of the late 1990s (e.g., AOL, Yahoo, Netscape) than the more stable SaaS era of the 2010s.
Elad Gil advises founders to build a multi-product bundle as the most effective defensive strategy to avoid displacement in the fast-moving AI market.