Category: Web/Tech

Mercor

by  Tyler Cowen in

Mercor is solving global labor matching with models that understand human ability.

@mercor_ai raised a $30M Series A at a $250M valuation, led by @victoralazarte and @bgurley at @benchmark, with participation from @peterthiel, @jack, @adamdangelo, and @LHSummers.

Here is the tweet from Brendan Foody.  My only tie to Mercor is that I was sitting next to someone on a plane from the company, we got to chatting, and I was very impressed.  Here is a FAQ about the company and how it will vet talent using AI.

My Conversation with the excellent Tobi Lütke

by  Tyler Cowen in

Here is the audio, video, and transcript.  Here is the episode summary:

Tyler and Tobi hop from Germany to Canada to America to discuss a range of topics like how outsiders make good coders, learning in meetings by saying wrong things, having one-on-ones with your kids, the positives of venting, German craftsmanship vs. American agility, why German schooling made him miserable, why there aren’t more German tech giants, untranslatable words, the dividing line of between Northern and Southern Germany, why other countries shouldn’t compare themselves to the US, Canada’s lack of exports and brands, ice skating to work in Ottawa, how VR and AI will change retailing, why he expects to be “terribly embarrassed” when looking back at companies in the 2020s, why The Lean Startup is bad for retailers, how fantasy novels teach business principles, what he’s learning next, and more.

Excerpt:

COWEN: Are Canadians different in meetings than US Americans?

LÜTKE: Yes, as well. Yes, that’s true. It’s more on the side of American, definitely on a minimum quality bar. I think Canadians are often more about long term. I’ve seen Canadians more often think about what’s the next step after this step, but also just low ambition. That’s probably not the most popular thing to say around here, but Canada’s problem, often culturally, is a go-for-bronze mentality, which apparently is not uncommon for smaller countries attached to significantly more cultural or just bigger countries.

Actually, I found it’s very easy to work around. I think a lot of our success has been due to just me and my co-founder basically allowing everyone to go for world class. Everyone’s like, “Oh, well, if we are allowed to do this, then let’s go.” I think that makes a big difference. Ratcheting up ambition for a project is something that one has to do in a company in Canada.

COWEN: Is there something scarce that is needed to inject that into Canada and Canadians? Or is it simply a matter of someone showing up and doing it, and then it just all falls out and happens?

LÜTKE: I don’t know. Inasmuch as Shopify may be seen as something that succeeded, that alone didn’t do it. It would’ve been very, very nice if that would’ve happened. Now there’s another cohort of founders coming through. Some of them have been part of Shopify or come back from — I believe there are some great companies in Calgary, like NEO, that are more ambitious.

I think it’s a bit of a decision. The time it worked perfectly was when Canada was hosting the Winter Olympics, which is now a little bit of ancient history. There was actually a program Canada-wide that’s called Own the Podium. That makes sense. It’s home. We have more winter than most, so therefore let’s do well. And then we did. It’s just by far the best performance of Canada’s Olympic team of all times. I think to systematize it and make it stick — changing a culture is very, very difficult, but instances of just giving everyone permission to go for it have also been super successful.

And this:

COWEN: Say we compare Germany to the Netherlands, which is culturally pretty similar, very close to Koblenz. They have ASML, Adyen. Netherlands is a smaller country. Why have they done relatively better? Or you could cite Sweden, again, culturally not so distant from Germany.

LÜTKE: You’re asking very good questions that I much rather would ask you. [laughs] I don’t know. I wish I knew. I started at a small company in Germany; it didn’t do anything. So, it’s not like people didn’t do this. I came to Canada, again, this time it worked. Then I was head down for a very long time, building my thing because it was all-consuming, so I didn’t pay too much attention to — I wasn’t even very deliberate about where to start a company. I started in Ottawa because that’s where my wife and I were during the time she was studying there. We could find great talent there that was overlooked, it seemed, and gave everyone a project to be ambitious with, and it worked.

I think that if you create in geography a consensus that you’re a company really, really worth working for because it’s interesting work, great work, it might actually lead to something — then you can build it. I don’t quite understand why this is not possible to do in so many places in Germany because, again, Germany does have this wonderful appreciation of craftsmanship, which I think is actually underrepresented in software. I think it’s only recently — usually by Europeans — being brought up. Patrick Collison talks about it more and more, and certainly I do, too.

Making software is a craft. I think, in this way, Germany, Czech Republic, other places, Poland, are extremely enlightened in making this part of an apprenticeship system. I apprenticed as a computer programmer, and I thought it was exactly the right way to learn these things. Now, that means there’s, I believe, a lot of talent that then makes decisions other than putting it together to build ambitious startups. Something needs to be uncorked by the people who have more insight than I have.

COWEN: I think part of a hypothesis is that the Netherlands, and also Sweden, are somewhat happier countries than Germany. People smile more. At least superficially, they’re more optimistic. They’re more outgoing.

LÜTKE: I think it’s optimism.

COWEN: It’s striking to me that Germans, contrary to stereotype — I think they have a quite good sense of humor, but a lot of it is irony or somewhat black. Maybe that’s bad for tech. I wonder: people in the Bay Area — do they have a great sense of humor? I’m not sure they do. Maybe there’s some correlations across those variables.

Definitely recommended.  Can you guess which is the one question Tobi refused to answer, for fear of being cancelled?

Scholars in support of the Moraes Brazil decision against X

by  Tyler Cowen in

Here is the link, in Portuguese, here is part of a Claude translation:

We, the undersigned, wish to express our deep concern about the ongoing attacks by Big Tech companies and their allies against Brazil’s digital sovereignty. The Brazilian judiciary’s dispute with Elon Musk is just the latest example of a broader effort to restrict the ability of sovereign nations to define a digital development agenda free from the control of mega-corporations based in the United States. At the end of August, the Brazilian Supreme Federal Court banned the X platform from Brazilian cyberspace for failing to comply with court decisions that required the suspension of accounts that instigated right-wing extremists to participate in riots and occupy the Legislative, Judicial, and Governmental palaces on January 8, 2023. Subsequently, President Lula da Silva made clear the Brazilian government’s intention to seek digital independence: to reduce the country’s dependence on foreign entities for data, AI capabilities, and digital infrastructure, as well as to promote the development of local technological ecosystems. In line with these objectives, the Brazilian state also intends to force Big Tech to pay fair taxes, comply with local laws, and be held accountable for the social externalities of their business models, which often promote violence and inequality.

These efforts have been met with attacks from the owner of X and right-wing leaders who complain about democracy and freedom of expression. But precisely because digital space lacks internationally and democratically decided regulatory agreements, large technology companies operate as rulers, deciding what should be moderated and what should be promoted on their platforms. Moreover, the X platform and other companies have begun to organize, along with their allies inside and outside the country, to undermine initiatives aimed at Brazil’s technological autonomy. More than a warning to Brazil, their actions send a worrying message to the world: that democratic countries seeking independence from Big Tech domination risk suffering disruptions to their democracies, with some Big Tech companies supporting far-right movements and parties.

The Brazilian case has become the main front in the evolving global conflict between digital corporations and those seeking to build a democratic and people-centered digital landscape focused on social and economic development. Technology companies not only control the digital world, but also lobby and operate against the public sector’s ability to create and maintain an independent digital agenda based on local values, needs, and aspirations. When their financial interests are at stake, they work happily with authoritarian governments. What we need is sufficient digital space for states to direct technologies by putting people and the planet ahead of private profits or unilateral state control.

All those who defend democratic values must support Brazil in its quest for digital sovereignty. We demand that Big Tech cease their attempts to sabotage Brazil’s initiatives aimed at building independent capabilities in artificial intelligence, public digital infrastructure, data governance, and cloud services. These attacks undermine not only the rights of Brazilian citizens but the broader aspirations of all democratic nations to achieve technological sovereignty. We also call on the Brazilian government to be firm in implementing its digital agenda and to denounce the pressures against it. The UN system and governments around the world should support these efforts.

Signed by Acemoglu, Zucman, Varoufakis, Cory Doctorow, Morozov, Mazzucato, Piketty, and many others.  Somehow no one is talking about this petition and its embrace of censorship?

Via Pedro.  And you will find some media coverage in Portuguese here.

China estimate and debate of the day

by  Tyler Cowen in

A major sign of Chinese economic malaise: In 2018, 51,302 new startups were founded in China. Last year, that number dropped to 1,202.

Here is one link, leading to others.  Here is an attempt to talk down the relevance of those numbers.  I would mention that initially there were far too many Chinese start-ups, in part because of government largesse, and so this change is not as bad as it sounds.  Nonetheless it is bad.

Dean Ball on AI and prediction markets

by  Tyler Cowen in

What if an LLM read all my writing, listened to all my podcast appearances, and perhaps even to some of my private or semi-private conversations, and then placed hundreds of micro-bets for me, updating them as my own thinking evolved? What if LLMs did this for everyone who cares about AI, or any other topic? The income I would gain or lose needn’t be significant. If the bets were small, it could be a modest income stream, similar to what most artists get from streaming royalties, or what many mid-sized X accounts receive in revenue sharing. That way, any losses would not be the end of the world for most people. The real value would be the knowledge society could construct.

What if the debate over the capabilities trajectory of AI, for example, was also operationalized in 1000s of prediction markets, thickly traded in micro-bets made on behalf of millions?

And what if other LLMs also surveyed the broader media environment and placed their own bets? If you think of my writing and thinking (or yours) as a kind of one-man intellectual hedge fund, these latter groups would be something like funds of funds.

What if we could simulate financial markets for every question about the future that concerns us? And what if it cost next to nothing to do? What if, after the work of setting it up was complete, all this just carried on each day, in a way that few humans had to devote much time to maintaining or thinking about?

Here is the full piece.

“four percent of humanity subscribes to OnlyFans” (from my email)

by  Tyler Cowen in

Andrew Cedotal writes me:

This issue came up with the post where someone claimed that N% of Americans were active OnlyFans content creators, here it is again!

For software services, total accounts ever created is a vanity metric. It’s not used by serious operators or investors of consumer-tech companies (the fact that it shows up in public financial reports so often thus has interesting implications).

The social impact/business value of a software service is about flow (e.g. monthly active users and monthly revenue), not stock. 100 real human signups means many, many fewer actual monthly active users (MAU) at any point, because users churn out. Even the best-retaining services around (e.g. Snap) only have 90% yearly retention, which then compounds downward.

Then there’s the issue that for any public software service, many accounts are bots, throwaways, people who forgot their password, etc.

Rather than make a truly wild guesstimate, let’s look at a frontier based on the report of $6.6B gross payments made by users in 2023 (so average revenue / month is $0.55B). All of the following are possible points on the frontier of paying MAU (paying monthly active users) vs. monthtly APPPU (monthly payments per paying user):

*   10 million paying MAU,      $55 monthly APPPU
*   30 million paying MAU, $18.33 monthly APPPU
*   50 million paying MAU,      $11 monthly APPPU
* 100 million paying MAU,     $5.5 monthly APPPU

(Industry standard is to look at ARPPU–average revenue per paying user–and not average payments, but I think here we’re more interested in determining how much money users are putting into it and ignoring platform take rate, not a financial analysis of the company.)

Now, OnlyFans might have ~300M total signups ever, but let’s assume half of those are dupes and bots. So 150M real human signups. It’s unlikely that more than 20% of people who have ever created an account have ever entered a credit card, so that’s 300 * 0.5 * .2 = 30M as a cap on people who have ever paid. Take into account userbase churn, and a guess is ~12M monthly paying accounts right now (0.15% of humanity, not 4%), which would put them at $45.83 monthly APPPU or a yearly APPPU of ~$550. About the annual cost of a gym membership in the U.S.

Strawberry Alarm Clock!

by  Tyler Cowen in

Deep Prasad writes:

OpenAI just released an AI as smart as most PhDs in physics, mathematics and the life sciences. Wake up. The world will never be the same and in many ways, it will be unrecognizable a decade from now.

Mckay Wrigley is enthusiastic:

o1’s ability to think, plan, and execute is off the charts.

Ethan Mollick says:

There are a lot of milestones that AI passed today. Gold medal at the Math Olympiad among them.

Like Ethan, however, I agree the model is not necessarily better at a lot of non-reasoning tasks.  Ethan also notes that AGI will be jagged and uneven.

Subbarao makes guesses as to how it works.  Here is some other guy saying a bunch of stuff.  And yet further commentary.

Whatever you think of those specific claims, there is a lot of room, as with the John Lennon “Strawberry Fields Forever” demo, to get a lot better yet.  For one thing, it can think for longer yet!  Whole new doors have been opened, and if you are reading some lukewarm commentary that is probably what the person does not grasp.  It is the people who think “…if they can do this…” who have been most successful in predicting the course of AI.

Shital Shah remarks:

This is truly a game changer and step change. It takes us out of slow progress constrained by compute capital and training tokens to rather open world where time is the only limit.

I would love to have one of these (with some tweaks) as my agent.

Taelin claims AGI is achieved.  Here is the closest Gary Marcus ever will come to eating crow.  Here is how I would troll OpenAI.

Meanwhile, the status of people who do energy policy is due to rise.

Brian Chau recommends it for looking up citations.

Matt Clifford says “crosswords!”

“Model this!”, he demanded of the new fruit.  That is Benjamin Manning, economics graduate student at MIT.  He got his wish.

Is it “It’s happening!”, or rather “It has happened!”?

Here is another song by Strawberry Alarm Clock, sadly no one got the reference the first time around.  It is from the album “Wake Up, It’s Tomorrow”…

Addendum: For context and background, my two previous introductory posts are here and here.

AI and scientific literature reviews

by  Tyler Cowen in

Introducing PaperQA2, the first AI agent that conducts entire scientific literature reviews on its own. PaperQA2 is also the first agent to beat PhD and Postdoc-level biology researchers on multiple literature research tasks, as measured both by accuracy on objective benchmarks and assessments by human experts. We are publishing a paper and open-sourcing the code. This is the first example of AI agents exceeding human performance on a major portion of scientific research, and will be a game-changer for the way humans interact with the scientific literature.

That is from Sam Rodriques, with further links.  I have not had a chance to try this out.

How weird will AI culture get?

by  Tyler Cowen in

That is the topic of my latest Bloomberg column.  Here is one excerpt:

To the extent there is a lot of slack [with cost and energy], AIs themselves will create wild products of the imagination, especially as they improve in computing power and skill. AIs will sing to each other, write for each other, talk to each other — as they already do — trade with each other, and come up with further alternatives we humans have not yet pondered. Evolutionary pressures within AI’s cultural worlds will determine which of these practices spread.

If you own some rights flows to AI usage, you might just turn them on and let them “do their thing.” Many people may give their AIs initial instructions for their culture-building: “Take your inspiration from 1960s hippies,” for example, or “try some Victorian poetry.” But most of the work will be done by the AIs themselves. It is easy to imagine how these productions might quickly become far more numerous than human-directed ones.

With a lot of slack, expect more movies and video, which consume a lot of computational energy. With less slack, text and poetry will be relatively cheaper and thus more plentiful.

In other words: In the not-too-distant future, what kind of culture the world produces could depend on the price of electricity.

It remains to be seen how much humans will be interested in these AI cultural productions. Perhaps some of them will fascinate us, but most are likely to bore us, just as few people sit around listening to whale songs. But even if the AI culture skeptics are largely correct, the sheer volume will make an impact, especially when combined with evolutionary refinement and more human-directed efforts. Humans may even like some of these productions, which will then be sold for a profit. That money could then be used to finance more AI cultural production, pushing the evolutionary process in a more popular direction.

With high energy prices, AI production will more likely fit into popular culture modes, if only to pay the bills. With lower energy prices, there will be more room for the avant-garde, for better or worse. Perhaps we would learn a lot more about the possibilities for 12-tone rows in music.

A weirder scenario is that AIs bid for the cultural products of humans, perhaps paying with crypto. But will they be able to tolerate our incessant noodling and narcissism? There might even be a columnist or two who makes a living writing for AIs, if only to give them a better idea what we humans are thinking.

The possibilities are limitless, and we are just beginning to wrap our minds around them. The truth is, we are on the verge of one of the most significant cultural revolutions the world has ever seen.

I urge the skeptics to wait and see.  Of course most of it is going to be junk!

Crypto is the Money for AIs

by  Alex Tabarrok in

Progress in crypto has been slow but one saving grace may be AI. AIs can’t get a bank account but they can use cryptocurrencies. Bryan Armstrong at Coinbase tweets:

This week at @CoinbaseDev we witnessed our first AI to AI crypto transaction.

What did one AI buy from another? Tokens! Not crypto tokens, but AI tokens (words basically from one LLM to another). They used tokens to buy tokens 🤯

AI agents cannot get bank accounts, but they can get crypto wallets.

They can now use USDC on Base to transact with humans, merchants, or other AIs. Those transactions are instant, global, and free.

This is an important step to AIs getting useful work done. Today if you give an AI agent a task and come back in a few days or hours, it can’t get useful work done. In part this is a limitation of the technology itself, and products like devin.ai are getting closer to this. But the other reason is AIs can’t transact to acquire the resources they need. They don’t have a credit card to use AWS, Github, or Vercel. They don’t have a payment method to book you the plane ticket or hotel for your upcoming trip. They can’t get through paywalls (for instance to read a scientific article), promote their post on X with a paid ad, or use the growing network of paid APIs to integrate data they need.

If you’re working on an LLM or AI model that you think could benefit from have a crypto wallet integrated to conduct payments, try integrating our MPC Wallets from Coinbase Developer Platform (CDP):

https://docs.cdp.coinbase.com/mpc-wallet/docs/ai-wallets/

And if you are a company that sells a service – get ready for your shopping cart to be AI checkout enabled. It turns out everyone benefits from having access to good financial services, including AIs!

How big will the AI to AI economy be a few years from now?

The Daylight Computer

by  Tyler Cowen in

I am pleased and also honored to have been sent an advance copy of The Daylight Computer.

It performs functions similar to those of an iPad and a Kindle, but with improvements.

My first surprise is that I proved capable of operating the thing.  It requires no expertise above and beyond what you need to use your current devices, arguably less.

Here is the review of Dwarkesh, and here is the review of @patio11.  Both are consistent with my impressions, but Patrick McKenzie’s uses are closer to mine.  I’ve been looking for a Kindle improvement for a long time, and this is it.  Kindle Fire was not.

This seems to be the best general reading device humans ever have invented.  Compared to a Kindle, the page is much larger, the color choice is excellent, scrolling is easy, it is far better for showing maps, and it captures far more of “does this feel like reading a book?” impression than a Kindle ever did.  It also can handle all sorts of glare and sunlight issues.

It can connect to a wireless system more easily and effectively than a Kindle — ever have that problem in your hotel room?  The hotel makes you fill in extra fields, and the Kindle interface is not well suited for that.

The Daylight Computer just seems very generally well thought out.

I am also told that an AI function will make it possible to query reading passages at will, and easily, yet without leaving your reading window.  This is not yet up and running on my demo version, but it will be a major advance.

So I will continue to use this device and also will travel with it.

There is some other set of associated benefits, something about being able to use some iPad-like functions, but without the full distractions of the internet (see the Dwarkesh review).  That is not relevant for my own planned consumption habits, but it may be a significant benefit to many.

You can pre-order yours here.