E69: Lost Tapes: Elad Gil on the Eve of the AI Boom

"Turpentine VC" | Venture Capital and Investing

This ‘lost episode’ of Turpentine VC with investor Elad Gil was recorded at a unique moment in time (September 2022) — before ChatGPT, Claude and Perplexity launched. Drawing from his experiences at Google, Elad discusses early ML systems, the open source debate, NVIDIA, labor markets, and AI alignment and shares some behind the scenes anecdotes.

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LINKS:

Attention Is All You Need: https://proceedings.neurips.cc/paper_files/paper/2017/file/3f5ee243547dee91fbd053c1c4a845aa-Paper.pdf

AI Revolution - Transformers and Large Language Models (LLMs): https://blog.eladgil.com/p/ai-revolution-transformers-and-large

Elad’s website: https://eladgil.com/

High Growth Handbook by Elad Gil: https://growth.eladgil.com/ | https://www.amazon.com/High-Growth-Handbook-Elad-Gil/dp/1732265100

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HIGHLIGHTS FROM THE EPISODE:

• This episode was recorded in 2022, before the launch of ChatGPT, Claude, and other major AI applications that are now common. This interview captured a moment in time when industry leaders were anticipating major breakthroughs in AI.
• Elad explained how AI's definition has evolved from basic automation in the 1980s to sophisticated applications, with Google emerging as the first true "AI-first" company at scale through its search and ad targeting systems.
• The 2017 "Attention is All You Need" paper proved pivotal, with six of its eight authors going on to start companies, creating what Gil compared to a "Xerox PARC moment" where Google developed breakthrough technology but others, particularly OpenAI, commercialized it.
• Elad outlined three main categories of emerging AI companies: platforms and infrastructure providers like OpenAI, AI-first standalone companies, and tech-enabled incumbents adding AI capabilities.
• Initial predictions about AI's impact on labor markets proved incorrect, with AI currently affecting white-collar, repetitive tasks more than blue-collar jobs, and creative and caring fields experiencing more disruption than anticipated.
• The semiconductor industry lacks a massive AI-specific chip company, with NVIDIA's continued success attributed to strong founder leadership, superior software tooling, and advanced interconnect capabilities.
• Elad emphasized the importance of open-source models and predicted the AI platform market would likely consolidate into an oligopoly similar to cloud infrastructure, with a few dominant players rather than a single winner.