Sam Altman wants artificial intelligence to create a one-person unicorn with a billion-dollar valuation

The AI ​​revolution has already minted dozens of unicorns: startups valued at $1 billion before going public. Now it could create a whole new kind of startup: the one-person unicorn.

The idea also got the approval of OpenAI CEO Sam Altman. Speaking during a interview with Reddit co-founder Alexis Ohanian, Altman said he regularly speculates about when the first founder will reach a billion-dollar valuation without even hiring a single employee.

“In my little group chat with my tech CEO friends there’s this betting pool for the first year there’s a one-person billion-dollar company,” Altman told Ohanian. “Which would have been unimaginable without artificial intelligence and now it will happen.”

Ohanian was also excited about this possibility. “This is a radical idea,” he told Altman during their interview at a September conference.

A one-person unicorn would defy conventional wisdom that a company needs to hire more employees to grow. “There will be a new phenomenon where CEOs and founders will be so excited to get up and go work with much smaller, much higher performing, much stronger culturally teams,” Ohanian said.

For many, the question is when, not if, this will happen. “I don’t know many people who don’t believe it,” says James Currier, a partner at venture capital firm NFX.

This new idea comes at a time when tech unicorns are facing a reckoning. Many have gone belly up and these “unicorps” have left founders, employees and investors in the lurch. Former startup employees find themselves out of work, while investors take a bath.

In this context, the prospect of a one-person unicorn would represent the pinnacle of the entrepreneurial spirit so prized by the tech industry. A one-man operation using technology to build a company valued at more than a billion dollars would be the pinnacle of the founder myth on which Silicon Valley was built, or he believes it was built. Since the 1930s, when Stanford friends David Packard and Bill Hewlett built their first product in the famous HP garage, which gave garages a folkloric status; to the infamous rivalry between Steve Jobs and Bill Gates at the dawn of the personal computer era; to the likes of Sergey Brin and Larry Page of Google or Mark Zuckerberg of Facebook who calculated the algorithms that governed the Internet age, the tech industry has always idealized the idea of ​​visionary founders imposing great technological leaps on society with sheer willpower.

The idea of ​​AI enabling a one-person unicorn is the logical evolution of this trend and has caught on across Silicon Valley. “We are entering a new ‘golden age’ of startups,” says Alex Gurevich, managing director of Javelin Venture Partners.

“Technology awaits us”

Startups, which have long had a reputation for resourcefulness, would only see this trait amplified by artificial intelligence, which could automate many of the processes that in the past would have required more staff. “The inherent advantage of a start-up over an incumbent is its ability to move quickly, experiment faster, execute data-driven decision-making, and test a number of different hypotheses in the process of product-market fit,” he says Gurevich. “GenAI adds these inherent benefits to steroids.”

Currier says the tools are already available, they’re just waiting for the right founder. “At this point, the technology is waiting for us,” Currier says. “So the technology doesn’t need to get better, we need to figure out how to use it.”

There are already several AI startups that specialize in creating tools for specific business functions ranging from marketing to legal work to writing code. All of this would allow a startup to iterate on thousands of different product ideas, marketing slogans and cost scenarios with a fraction of the time and personnel, according to Gurevich. In a July blog post titled “The 3-Person Unicorn Startup,” Currier compared an AI startup to a plate-spinning act where the performer only needs to spin the plates once and give it a push from time to time to maintain them. balanced on the fingers.

Dan Sutera, co-founder and chief product officer of website design startup Muse, says the boss of a one-person unicorn will likely be a salesperson, a part of running a business that still requires a human touch. Though he warns that some one-person unicorns may get that title on a technicality, hiring contractors who aren’t considered employees to do design and coding work that neither they nor the AI ​​can do. “I would put an asterisk next to someone who has reached the record threshold of an individual unicorn in this way, even though it is still very impressive,” Sutera says. “There will be someone who is a true one-man shop who will reach the same threshold. For me, that boy or girl gets the prize.

But just because AI can do a certain task, doesn’t mean founders will necessarily let AI do it. Most founders won’t hand over the most critical tasks to AI where the risk of making a mistake could be particularly drastic, according to New York University professor Vasant Dhar who researches trust in AI systems. Dhar gives the example of analyzing a long legal document, such as a contract with a major client or an investor’s deal sheet. In these high-risk cases, one mistake could spell disaster for a startup.

“The question is: will AI be more efficient and low risk?” he asks.

Software made with artificial intelligence will eat the world

There is a history of very small startups getting huge valuations. Instagram famously had just 13 employees when it was sold to Facebook for $1 billion in 2012. In 2008, dating site Plenty of Fish had just one employee, founder Markus Frind, generating $10 million in profits – a rarity in in and of itself for growth. startups. Even though Frind, the ultimate bootstrapper, had about 75 employees in 2015 when he sold Plenty of Fish to online dating giant Match Group for $575 million.

In addition to limited staff, these companies also have something else in common: they are consumer software. Startups making these types of products are very likely to be the first one-person unicorns, Gurevich and Currier say. A software product can be built once, possibly with the help of an AI co-pilot, and then updated at regular intervals, as in Currier’s plate-spinning analogy. Once completed, most of the remaining work will involve recruiting new users.

Traditional companies, especially those that produce physical goods, cannot afford this luxury. “If you’re a Ford Motor Company, you have eight different buildings for eight different functions: procurement, manufacturing, sales, dealerships, marketing,” Currier says. “With these [software] products, not you. You eliminate a lot of those divisions in your company, so you don’t need people to manage them. Then the AI ​​comes in and helps you with all the pieces you need to do.”

Enterprise software products, while similar, would require a more hands-on approach, making them less suited to the automation needed to become a one-person unicorn. According to Gurevich, companies that purchase the software will likely expect smooth customer service and have greater cybersecurity needs.

Another strong candidate to become the first individual unicorn is a direct-to-consumer e-commerce startup, Gurevich says. Such a startup would use AI for idea generation, advertising and market research, he adds.

Ironically, a one-person unicorn is unlikely to be an AI company. “This one-person unicorn won’t necessarily build a native GenAI product on its own, but it will be world-class at leveraging GenAI internally to power startup advantage,” Gurevich says.

Founders still need to be visionaries

But just because what was once a pipe dream now seems possible, or at least plausible, doesn’t mean these startups of the future won’t still need exceptional founders. Most unicorns do. Currier believes the three-person unicorn will be led by a founder who has the same visionary ideas that drive the most successful founders.

“Founders of three-person unicorns will need to be prone to a stroke of genius and not be afraid to act on these impulses,” he said in his blog post. “You have to be able to see something that others don’t see, and aggressive, courageous or unpleasant enough to act.”

The other two members will be a “numbers person” and a “words person”. They will also need to be extremely talented. “To make a three-person unicorn will require a very special talent among the three people,” Currier wrote. “Few teams will have the multifaceted skills to pull this off.”

According to Sutera, former vice president of product at unicorn Yext, the three fundamental elements of a startup are design, sales and engineering. In the past, having cofounders who specialized in each field was the “holy trinity.” But now, a single founder could have a combination of all three skills that would be “augmented by AI superpowers,” Sutera says.

The one thing that will continue to be a hot commodity is soft skills. An AI program can’t make a sale with an important customer or have enough taste to choose the right design for a product, Sutera says.

Currier agrees. “For the information work we do, the defensibility of technical expertise diminishes over time,” Currier says.

There’s another important reason why Currier supports the idea of ​​a three-person unicorn with AI-enhanced productivity instead of a single-person version. It depends on human nature, he says: people need company. “If you do it alone, you’ll end up feeling really alone,” he says. “You end up not enjoying what you’re doing and you end up making bad decisions.”

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