The Scam of AI content startups



As a startup coach, I have been faced with a sudden deluge of companies that can help you author articles merely by giving keywords and using AI. Other companies are letting you generate images by giving keywords. And the third one is doing a combination. You provide some keywords, and they will generate an image, and some text, ready to be posted on social media as a post.


Investors are getting super-impressed by such companies and investing in them. I am authoring this article so that investors should be aware of what is happening and how so many companies have become brilliant AI companies within the past few months.


THE SECRET

A company called OPENAI developed a transformer called GPT-3. They made it publicly available for a charge (quite cheap actually). It is their GPT-3 engine that does all the AI work. You can test it out at https://beta.openai.com/playground


Now these so-called brilliant startups are doing this:


  1. Create a user interface that looks better than https://beta.openai.com/playground

  2. Join the API of OPENAI to this front end

  3. Charge 10 times the money for doing the same work that OpenAI can do with its basic-looking UI

  4. Show revenue and ask for investments.


WHAT'S REALLY HAPPENING

  1. All these companies are using the same technology in the background, but the technology and IP do not belong to them.

  2. This is same as me, building a search engine's frontend, using google in background, and showing you how great my results are... Will you invest in me?


THE RISK

If OPENAI stops operations tomorrow, all these startups will come to a standstill.


MITIGATION

Other companies are also producing similar technologies and while, to the best of my knowledge, there is none better than GPT-3 right now, they are getting close. Unless the startup has an alternative available to it, it risks becoming defunct by relying on only one GPT-3. So, before you invest, ask them how they will mitigate this risk and what is the backup plan.


I hope I have helped at least some investors who, not knowing the tech facts behind these "frontend startups", were unduly impressed and investing in them.



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