Why ChatGPT maker OpenAI is the No. 1 2023 CNBC Disruptor 50 company

No innovation has had a greater cultural impact and no technology product has had a greater impact in the last six months than OpenAI’s ChatGPT.

the MicrosoftA startup company’s AI-powered chatbot stunned consumers when it debuted at the end of November. It has unveiled a quantum leap in the ability of humans to interact seamlessly with artificial intelligence, which in turn has access to the entire world of information on the Internet.

AI is having its own iPhone moment. Apple’s great product sparked the invention of a new ecosystem of apps that bring users new services, from Uber to Instagram, because suddenly they have a computer in their pocket. Coinciding with that mobile revolution was a computing revolution as well, with massive data transfer power to the cloud.

Now we are witnessing a similar technological boom around artificial intelligence. It’s not just about the amazing experience of interacting with the latest chatbots. Artificial intelligence will affect, disrupt and accelerate every industry. In fact, this is already happening.

With OpenAI topping this year’s Disruptor 50 list, there is no doubt that the dominant theme not only of the annual rankings but of the venture-backed tech startup space as a whole is AI.

And it’s not just companies that have AI at their core. We see a range of enterprise applications of AI to drive efficiency and new capabilities across businesses and market segments. Of the 50 companies on this year’s list, 21 told us that AI is critical to more than 50% of their revenue.

Half of the companies in the top ten of the 2023 CNBC Disruptor 50 list feature major use of AI, particularly as they represent a variety of industries and use cases. Canva, Company No. 3, is integrating ChatGPT into its design tools, giving clients a new way to get creative. No. 4 Disruptor Relativity Space uses artificial intelligence to make 3D printed rockets. No. 7 Disruptor Anduril Industries deploys artificial intelligence to identify and attack security threats. UK-based renewable energy company Octopus Energy, No. 8 on this year’s list, uses artificial intelligence to efficiently match energy supply and demand. No. 9 Lineage Logistics uses artificial intelligence to improve the movement of goods through a temperature-controlled supply chain.

“I think we’re deep in a new technology wave and this is, I think, the biggest in a while,” OpenAI CEO Sam Altman said in an interview with CNBC late last week.

#19 on the Disruptor 50 list, Scale AI He has worked with companies including OpenAI to name the vast amounts of data – images, text, audio and video – that machines need to ingest to become better learners. Also on the list is Disruptor #44, Cohere, which was founded by former Google Brain researchers who helped develop a new method of natural language processing — adapters — that enables systems to more accurately understand word context.

Altman said that OpenAI sees AI affecting almost every industry. He cited the legal profession as an example to follow.

“What we’re hearing from clients using our API for law firms is that it completely changes the way they work and the efficiency that any lawyer can achieve and the accuracy, freeing up people to do more of what they do really well, and having this new tool to kind of give them as much as possible.” of influence.”

“This is a pattern that we see over and over in many industries, and I’m really excited about it,” he said.

It has been shown to make stock market investors volatile the alphabetShares of Bard plunged after the launch of its ChatGPT competitor, Bard, earlier this year — which some employees described as rushed. And in one of the sectors seen most at risk from generative AI, education, Chegg saw its shares drop nearly half simply because its CEO cited ChatGPT’s impact on customer growth during a recent earnings call.

Right now, OpenAI has a dual revenue stream: an enterprise software model where it charges companies to access the platform, and a premium chat app it offers to consumers for $20 per month, on top of the free version.

Altmann said, “Right now, we’re very happy with these two models. We’re very open to explaining other things, you know, when we’re at the beginning of this technology.”

OpenAI’s commercial customers include Salesforce, Snapchat and its supporter Microsoft, which bring OpenAI-generated AI technologies to Bing and Edge web browsers and the Microsoft 365 suite of business software, including Word, PowerPoint and Excel.

Microsoft’s cumulative investment in OpenAI has reportedly ballooned to $13 billion, and the startup’s valuation is reported to be as high as $29 billion. The company refused to provide any financing or valuation data.

The growth of AI power has been so rapid and dramatic that it has alarmed politicians and regulators. Those looking to play in the space — including Elon Musk, who was a co-founder of OpenAI and now says he will launch a competitor — also talk about the stakes. Musk, along with Apple co-founder Steve Wozniak and a group of professors and executives, signed an open letter in March from the Future of Life Institute, urging AI labs to stop training models more powerful than OpenAI’s GPT-4.

Altman first responded in an appearance at a virtual event at MIT, saying consistent safety guidelines were needed but that the proposed pause was “missing most of the technical nuances about where we need to pause.”

Altman continues to advocate for regulation. “We really need regulation here. We’ve been calling for it since the company’s inception,” he said. “I think we’ll get some regulations, and we’ll get more over time. And I think that’s really critical. So I’m glad that happened.”

“I think we get to a future where we have as much good use of AI and minimize uses that can be very bad of AI,” Altman said, “There’s no way around here. Industries with much less powerful technology. So we have to get it here. certainly “.

Reid Hoffman, partner at venture capital firm Greylock, was an early investor in OpenAI and is now an investor in a number of AI companies and co-founder of AI startup Inflection. He said he finds some of the criticisms more severe than OpenAI.

He is also a Microsoft board member and served on OpenAI’s board before stepping down due to potential conflicts of interest, said Hoffman. “Some of it is not well-intentioned: ‘Everyone else, slow down so I can speed up. ‘ And this is one of those things where it’s generally a wrong effort… An advocacy of slowing down is, in fact, less safe than they suggest,” he said, referring to to OpenAI and Altman.

In addition to concerns about AI being used to manipulate or mislead, Altman said he is working to reduce bias within OpenAI systems.

“A big part of that is what we call RLHF, or Reinforcement Learning from Human Feedback, where we take these pre-trained models on a large chunk of the internet and we can kind of nudge them in certain ways,” Altman said. “We can teach models like, ‘Hey, there’s a bias here in the data.'” You shouldn’t act this way. He said that from GPT-3 to GPT-4, the company has made great strides in reducing model bias.

As companies including OpenAI battle bias and push for intelligent regulation, they are also working with tech giants, such as Microsoft, and leaders in all kinds of industries to help them evolve, so they are not disrupted.