TheBRRR’s GM

We live in exciting times.

Generative AI is a civilization-redefining technology in its early innings putting us on the brink of miracle-like breakthroughs across industries.

Governments are trying to regulate and control AI, evidenced by President Biden’s executve order released today, but their efforts will ultimately be futile.

To date, public-market investors have capitalized by investing in two buckets of large cap companies seen as early beneficiaries - semiconductors (chipmakers like NVDA, ASML, AMD), and first-movers in big tech implementing and bundling the technology in its software tools (MSFT, ADBE, CRM, TSLA).

The early-stage AI landscape has been hyper-active with thousands of oversized seed rounds, but the playbook to big success is still developing.

There have been very few clear winners outside of the ubiquitous model creators OpenAI and Anthropic who are on a tier of their own.

The next biggest startup success would be Midjourney - a 1.5 year-old generative image platform that has never taken outside investment at all.

It’s on its way to $200m in revenue this year with only 50 employees. We use Midjourney for the newsletter’s AI art.

The AI space is a fascinating environment for investors, and we will diligently assess and report on every key trend and opportunity that arises.

Market News

AI in AWS: Silver Lining in Amazon’s Report

Amazon reported third-quarter results that exceeded Wall Street’s expectations, with a significant earnings beat and revenue growth.

Positive comments regarding their cloud services business, especially regarding AWS generative AI products, helped boost investor sentiment.

• AWS Growth and Stability: While Amazon Web Services (AWS) missed its sales expectation slightly by $100 million, it remains a pivotal profit source for Amazon. The Q3 operating income for AWS surged by 29% year over year to $6.98 billion, surpassing the predicted $5.6 billion. AWS’ growth indicates its dominant position in the market, despite a general slowdown in the cloud sector, as seen with competitors like Google.

• Significance of AI in AWS: CEO Andy Jassy pointed out the growing adoption of Amazon’s generative AI products. This emphasis on AI is crucial with competitors like Microsoft heavily investing in the same area. Amazon’s AI innovation is also evident in their recent moves, such as the investment in Anthropic and the launch of Amazon Bedrock, which aids in building generative AI applications.

• Amazon’s Diverse Revenue Streams: Beyond cloud services, Amazon’s e-commerce sales went up by 7% to $57.3 billion. Moreover, advertising emerged as Amazon’s quickest expanding division, with the company generating $12.1 billion in ad revenue, a 26% rise from the previous year.

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$100 Reader Giveaway

The AI Tool Report highlights fantastic AI tools. We’re giving away $100 to a reader that subscribes to the AI Tool Report and tells us about their favorite AI Tool they learn about as a subscriber.

To participate, subscribe below and email us about the best thing you’ve learned from them by November 15th. Only 1 submission so far - you’ve got great odds to win. 👇

Macro News

AI Under Uncle Sam's Eye: Innovation Meets Regulation

President Biden has initiated a comprehensive executive order on artificial intelligence, addressing numerous facets including AI safety, privacy, civil rights, and innovation.

This move, following calls from tech magnates like Elon Musk for AI regulation, aims to foster a balanced growth of AI technology ensuring both security and advancement.

The order mandates various measures such as sharing safety test results and notifying the government about AI systems that could endanger national security or public health.

• Holistic Regulation Approach: The executive order adopts a holistic approach to AI regulation, addressing not just one or two, but multiple aspects of AI including safety, equity, privacy, and innovation, thus ensuring a well-rounded governance framework.

• Mandatory Disclosures: Under the order, developers of influential AI systems are required to share safety testing outcomes with the government, and notify authorities if their AI systems pose risks to national security, economy, or public health, establishing a transparent interaction between tech firms and the government.

• International Collaboration: The order also emphasizes on international collaboration on AI safety and standards, projecting a vision of not just national, but global responsible AI development, positioning the US as a leader in the global AI race while promoting a collective global approach towards AI safety and innovation.

  Read more and here

Today’s Reader Poll

Wondering your opinion for AI in the future. Do you see it as a net benefit or detriment:

Here’s the consensus on Yellen’s performance. Amazing ( /s ):

AI Art of The Day

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The BRRR is meant for informational purposes only. It is not investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions.