20VC: Perplexity's Aravind Srinivas on Will Foundation Models Commoditise, Diminishing Returns in Model Performance, OpenAI vs Anthropic: Who Wins & Why the Next Breakthrough in Model Performance will be in Reasoning

The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

Aravind Srinivas is the Co-Founder & CEO of Perplexity, the conversational "answer engine" that provides precise, user-focused answers to queries. Aravind co-founded the company in 2022 after working as a research scientist at OpenAI, Google, and DeepMind. To date, Perplexity has raised over $100 million from investors including Jeff Bezos, Nat Friedman, Elad Gil, and Susan Wojciki.

In Today's Episode with Aravind Srinivas We Discuss:

1. Biggest Lessons from DeepMind & OpenAI

• What was the best career advice Sam Altman @ OpenAI gave Aravind?

• What were Aravind's biggest takeaways at DeepMind?

• How did DeepMind shape how Aravind built Perplexity?

• What did Aravind mean by "competition is for losers?" What did he learn about talent assembly at DeepMind?

2. The Next AI Breakthrough: Reasoning

• Does Aravind think we are experiencing diminishing returns on compute & model performance?

• Does Aravind agree reasoning will be the next big breakthrough for models?

• What are the reasons Aravind thinks models suck at reasoning today?

• What is the timeline for reasoning improvement according to Aravind?

• What does Aravind think are the biggest misconceptions about AI today?

3. Will Foundation Models Commoditise?

• Does Aravind think foundation models will commoditise? What will the end state of foundation models look like?

• Why does Aravind think the second tier models will get commoditised?

• Why does Aravind think the subscription model will not work for AI models with true reasoning?

• Why does Aravind think the application layer companies will benefit from foundation models commoditising?

• Why does Aravind think foundation models will not verticalize?

• When does Aravind think is the right time to go enterprise? What is his strategy to differentiate Perplexity from its competitors?

4. AI Arms Race: Who Will Win?

• Who does Aravind think will be the winners of foundation models?

• What do AI companies need to do to win the model arms race?

• How does Aravind think startups can compete against incumbents' infinite cash flow?

• What are the reasons Aravind thinks Perplexity's browsing is better than ChatGPT?

• What is Aravind's biggest challenge at Perplexity today?