AI Is Not Covid
John responds to "Something Big Is Happening," Musk loses another co-founder, Labor Department prints strong jobs report, and more
Happy Wednesday.
We’re live from YouTube and 𝕏.
The current thing in tech and business is the viral article about AI progress by Matt Shumer called “Something Big Is Happening.”
Today’s lineup
Shopify President Harley Finkelstein at 12:00 PM
“Something Big Is Happening” author Matt Shumer at 12:15 PM
Index Ventures Partner Danny Rimer at 12:30 PM
Robinhood Co-Founder and CEO Vlad Tenev at 1:00 PM
Inertia Enterprises Co-Founder and CEO Jeff Lawson at 1:30 PM
Monaco Co-Founder and CEO Sam Blond at 1:40 PM
Loyal Founder and CEO Celine Halioua at 1:50 PM
Juxta Founder and CEO John Ferrara at 2:00 PM
Daily Op-Ed, by John Coogan
AI Is Not Covid
Everyone is talking about Matt Shumer’s viral X article “Something Big Is Happening.” He’s coming on TBPN today at 12:45 Pacific to talk about it. There are some great bits in here, and a few things that I disagree with.
First, the Covid comparison. Think back to February 2020, everyone in tech was aware of how quickly a virus could spread around the world because exponential curves exist all over the tech industry. Everyone in tech has studied Moore’s Law. Most people in tech can quote Albert Einstein saying “The most powerful force in the universe is compound interest.” And the real ball-knowers will tell you that there’s no evidence that Einstein ever actually said this.
But the point holds. Exponentials are crazy, hard to wrap your head around in the moment, and lead to profound changes.
I hate the Covid analogy though, because the number of people who caught Covid didn’t follow an exponential curve, it was a logistic curve. It was growing exponentially from 2020 to about 2022, and then started decaying. Eventually the number of cases plateaued. Mathematically this was inevitable, because to keep growing indefinitely, you need an infinite supply of humans that can get infected, and there are only 8 billion people on Earth. Something like a billion people reported Covid infections, it’s impossible to 10x from there.
There’s a great 3Blue1Brown video about this:
Anyway, back to AI. If you model the power of artificial intelligence as a function of energy, we do have plenty of room for exponential growth. Humanity is 13 orders of magnitude away from Kardashev Type 2 (aka Dyson Sphere capturing 100% of the sun’s energy). We use less than 1% of energy on AI right now, so maybe it’s 15 OOMs. Either way, it is growing exponentially right now, but how this feels in average life and how it changes our society will be much more like a series of S curves. There will be bottlenecks all over the place, and time to adjust.
I do like Matt’s framing of “It’s time to talk to your friends outside the tech world about AI.” There are many cases of perspectives on AI being uninformed due to limited interaction with older models. Six finger images, hallucinated facts in LLM responses, knowledge cutoffs. Many people still use these as reference points even though they are woefully out of date.
New coding models are remarkable, and they will clearly reshuffle the economics of the tech industry and permanently change the role of software engineers in most companies. At the same time, when I think about “telling my friends outside of tech about the coming wave,” I’m not entirely sure how helpful an understanding of coding agents will be for them.
Thinking through my friends. The surgeon might be able to negotiate his patient booking SaaS contract because more startups will enter the category? But his customers still want him holding the knife. He definitely needs to stay up to speed on robotic surgery tech, but that’s not happening this month if we are in a “software-only singularity.” The teacher might have to grapple with kids being more distracted by ever better social video feeds, but parents aren’t ready to turn over custody of their children to a humanoid robot.
During Covid, really anyone could get sick at any time, so it made sense to educate people broadly, but the software-only singularity won’t be evenly distributed. Many jobs will change, but if you’re out of the loop, it might be because your job is already several layers removed from software, so February of 2026 isn’t the right time to drastically shift.
Nevertheless, the capabilities of coding agents are remarkable, and fun to talk about, so it is worth explaining to friends and family outside the tech world. But you shouldn’t treat it like Covid, it’s not just going to sneak up on most people. After all, the industry that’s actually “holding up the economy” is healthcare and social assistance (and this showed up big in the latest job numbers. Economists expected 65K jobs and the number came in more than double at 130K jobs).
Excited to talk about this more with Matt today on the show.
Headlines
CNBC: Musk’s xAI loses second co-founder in two days
NYT: U.S. Hiring Starts the Year at a Strong Pace
Bloomberg: Mistral Invests €1.2 Billion in Swedish AI Data Center Buildout
AP: Trump administration ties El Paso airspace closure to Mexican cartel drones
Axios: Paramount ratchets up competition for Warner Bros. but still falls short
Apptronik Raises Over $935 Million in Series A Funding
Matt Shumer: Something Big Is Happening
NYT Opinion: OpenAI Is Making the Mistakes Facebook Made. I Quit.
Fortune: BlackRock offers DeFi trading for the first time, buys Uniswap tokens
The New Yorker: What Is Claude? Anthropic Doesn’t Know, Either
FT: 25-year-old founder raises $220mn for secretive UK AI chip start-up
WSJ: OpenAI Executive Who Opposed ‘Adult Mode’ Fired for Sexual Discrimination
Dave Morin: Don’t Be Off By 10 Years
Posts of the Day
TBPN is brought to you by Ramp.
Ramp is the all-in-one finance automation platform that helps businesses save time and money with smarter corporate cards, spend management, and bill pay.
Special thanks to our sponsors: Shopify, Graphite, ElevenLabs, CrowdStrike, MongoDB, Fin, NYSE, AppLovin, Phantom, Gemini, Cognition, Labelbox, Public, Kalshi, Restream, Vanta, Console, Railway, Figma, Plaid, Okta, Linear, Turbopuffer, Lambda, Gusto, Vibe.co, Sentry, and Cisco.
I do think that white collar work drastically changing will affect everyone, but more like if COVID infected you through a computer screen. Some people are in massive danger while others will barely notice. In this sense, AI is reverse COVID, the more blue collar, hands on, and face to face your role is, the less you need to care about it.