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- ♞ How DeepSeek Changed Pitching
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How to pitch in the post-DeepSeek era?
For the past three years, the AI craze has consumed the VC space. At first, investors were willing to back anything AI, but over time, they started to limit what they would back to companies that they felt had defensible technologies.
Funny enough, it seems that GPT wrappers, at least in the short term, where the best bet as many of them have simply switched their underlying model to DeepSeek cutting their costs and increasing their margins. In short it appears that the wrappers had a competitive advantage that nobody expected when they assumed OpenAI would dominate the world of LLMs forever.
In the week since DeepSeek was released, I’ve seen three specific things that VCs are now looking for when analyzing investment opportunities. These are things that can’t be easily replaced and protect a company regardless of the next LLM to come along.
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Proprietary Data - This has always been the key to AI. The more data you own, the more customized and valuable your AI product can be. If you have access to proprietary data that you can use to provide a better or more customized experience for consumers, then you’ll always be able to outperform the latest LLM (or integrate it). When pitching, this can come from existing data you’ve collected or a strategy to collect proprietary data and create a moat.
Users - If you already have users, then you have an inbuilt advantage. More companies (and, to a lesser extent, individuals) don’t like having to change the software they use. If you already have customers, even if a better alternative comes out, you’ll have a chance to retain your customers if you act quickly enough to improve your product before that friction wears out.
Hardware - This is the ultimate moat in AI, as no matter the software advancements, everything is constantly demanding better hardware. This is why Nvidia is so valuable. Unfortunately, this is a near-impossible vertical to compete in as a startup.
Does your company have one of these moats? |
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