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The 5 Level AI Spectrum


According to NfX, who seem to be the world leader in investing in and talking about Network Effects, there are 5 levels of AI in a product. The spectrum is:

  1. AI Enhanced: A company is using AI to be more efficient. The bare minimum. An example might be a marketing agency is using generative AI to write web page copy.
  2. AI Product Extension: A company is using AI as a locking mechanism to secure Product Market Fit. An example might be a recruiting applicant tracking system now has a pdf resume reader that creates a vector database of information that can be used in the matching algorithm. This is an idea I had, call me if you want to do it.
  3. AI Enabled: Everything from 1 and 2, plus an embedded alrorithm at the core.
  4. AI is the Product: AI is the central selling point. Obvious examples are OpenAI and HuggingFace.
  5. AI First: Everything the company does is impossible without AI.

AI First is the most exciting and explosive area that we're working in right now. There are literally countless startups that are building products that were impossible before and don't have the baggage of the legacy product.

Schedule an Alignment Call For Founders with Mike to spend 15 minutes to see if we are in alignment on how you might build an AI product.