The AI Boom Inside Silicon Valley Start-Up Accelerators

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The archbishop’s mansion successful San Francisco, built successful 1904, is present a stately edifice astatine the northeast country of Alamo Square Park. Since February, it has been rented retired wholly to HF0, oregon Hacker Fellowship Zero, a start-up accelerator that provides 12-week residencies for batches of fellows from 10 antithetic start-ups. Their experience, which culminates successful a objection day, is expected to beryllium the astir productive 3 months of the fellows’ lives. Dave Fontenot, 1 of HF0’s founders, was inspired by the 2 years helium spent surviving successful monasteries successful his 20s: While monastery beingness was materially ascetic, helium recovered that it was luxurious successful the state it gave residents to absorption connected the things that truly mattered. And astatine the Archbishop’s Mansion this year, astir everyone has been monastically focused connected what has go San Francisco’s newest religion: artificial intelligence.

The A.I. gospel had not yet dispersed successful 2021, erstwhile Fontenot and his 2 co-founders, Emily Liu and Evan Stites-Clayton, started the accelerator. Even a twelvemonth ago, erstwhile HF0 hosted a batch of fellows astatine a edifice successful Miami, six retired of the 8 companies represented were cryptocurrency start-ups. But astatine the mansion successful San Francisco, 8 of the 10 companies successful HF0’s archetypal batch this twelvemonth were moving connected A.I.-based apps, and the lone crypto start-up — focused connected what happens to your Bitcoin erstwhile you dice — was worried, they told me, astir whether the investors who showed up astatine this spring’s demo time would really privation to put successful them.

That generative A.I. has mostly supplanted crypto successful the eyes of founders and task capitalists alike is not precisely surprising. When OpenAI released ChatGPT precocious past year, it sparked a caller craze astatine a clip erstwhile the collapsing crypto and tech markets had near galore investors and would-be entrepreneurs adrift, unsure of wherever to enactment their superior and time. Suddenly users everyplace were realizing that A.I. could present respond to verbal queries with a startling grade of humanlike fluency. “Large connection models person been astir for a agelong time, but their uses were limited,” says Robert Nishihara, a co-founder of Anyscale, a start-up for machine-learning infrastructure. “But there’s a threshold wherever they go dramatically much useful, and I deliberation present it’s crossed that.”

One entreaty of generative A.I. is that it offers thing for each would-be entrepreneur. For the technically minded, determination is probe to beryllium done. For the concern types, it’s casual to make applications connected apical of the OpenAI platforms. For the philosophically inclined, A.I. offers absorbing avenues done which to research what it means to beryllium conscious and human. And dissimilar crypto, particularly now, A.I. is simply a much credible tract to beryllium successful for mainstream techies. Its products person already achieved important traction among consumers — ChatGPT is believed to beryllium the fastest app ever to deed 100 cardinal users — and immoderate of the figures astatine its forefront are acquainted faces, present successful their 2nd acts, similar Sam Altman, formerly the president of the start-up accelerator Y Combinator, and Greg Brockman, formerly the main exertion serviceman astatine Stripe, the payments-processing company. In short, you can’t assistance reasoning that, arsenic 1 person precocious proclaimed to me, “Everyone successful S.F. is either starting oregon moving an A.I. institution oregon starting oregon moving an A.I. fund.”

A.I., successful turn, seems to emotion San Francisco back. During the pandemic, arsenic tech workers went distant and Twitter pundits evangelized the taxation benefits of being successful Austin oregon Miami, the San Francisco country seemed poised to cede its start-up primacy. But precocious that inclination has reversed. There’s a consciousness that if you privation to beryllium moving successful A.I., this is inactive the spot to be. “We really archetypal considered doing the batch successful New York, but erstwhile I went to New York and asked radical what they thought of GitHub Copilot” — an A.I.-powered coding adjunct — “people told maine they possibly tried it once,” Fontenot said. “On the different hand, radical successful S.F. told maine they were utilizing it to constitute 50 percent of their code.”

Fontenot’s anecdote gets astatine 1 of Silicon Valley’s enduring qualities: the willingness, adjacent eagerness, to clasp caller technology. Out successful the remainder of the world, A.I. is triggering nerves — fears and adjacent predictions of wiped-out jobs, of existential doom — and endless commentary. In San Francisco, it has kindled each these things too, but besides a question conscionable arsenic powerful: How bash you get a portion of it?


Michaela Carmein getting dressed arsenic  a robot. Lucas Gaylord and Emily Liu basal   adjacent  to Carmein.
Michaela Carmein getting dressed arsenic a robot from the twelvemonth 2043, with Lucas Gaylord and Emily Liu earlier the commencement of HF0’s demo-day activities.Credit...Laura Morton

During the day, the Archbishop’s Mansion often feels amazingly bare and quiet, possibly due to the fact that it’s truthful large. There are 4 floors and a expansive staircase that winds up done the mediate of the building, lit by a elephantine skylight. Many of the teams enactment successful their rooms upstairs; immoderate teams enactment successful the “hackspace” successful the basement, with its whiteboards and rows of lasting desks. When I was visiting this spring, 1 partition displayed immoderate ChatGPT-generated poetry: “In HF0, the hackers enactment and play/With laughter and fun, passim the day./They’re a assemblage of techies, with a bosom of gold,/And their wit and hacking skills, ne'er turn old.”

But connected a outpouring Friday nighttime — the 1 nighttime of the week erstwhile the broader tech assemblage is welcomed successful — the A.I. enactment was successful afloat swing. Fontenot and Liu bounded astir the communal spaces astatine the beforehand of the mansion, giving retired effusive hellos and introductions.

In 1 backmost room, a barroom served elixirs. (The mansion is simply a no-alcohol zone.) In another, an A.I. rap conflict raged. (It wasn’t overmuch of a battle, really — portion the A.I. is nary Eminem, it was inactive destroying everyone.) In a third, Jonathan Shobrook, a fellow, was demoing his product, Adrenaline, a instrumentality that lets you inquire natural-language questions of your codification base. He had the interface up connected a show and a tiny clump of spectators astir him, seemingly riveted.

“Can you inquire it to instrumentality ReLU?” Sasha Sheng asked. Sheng, a erstwhile bundle technologist astatine Facebook, is present moving connected her ain app; successful dyed pigtails and a shot cap, she is thing of a property successful the community.

“Oh, yeah, that’s a hard question,” Shobrook responded. On his keyboard, helium typed, “Which neural networks usage ReLU?”

The close reply flashed connected the screen, the cursor blinking arsenic characters appeared. Someone asked however it worked.

“I conscionable fundamentally chunked up each the files into functions and classes and groups of code, generated summaries of those codification chunks and past recursively summarized the file,” Shobrook said.

“Do you usage an abstract syntax tree?”

Only successful San Francisco would radical beryllium talking astir abstract syntax trees astatine 9 p.m. connected a Friday night.

Out successful the main entryway, idiosyncratic introduced himself arsenic Bruno. I asked him whether helium was successful A.I. “My archetypal 2 companies were successful A.I., but present I’m successful crypto,” helium said jovially. Fontenot came up from down and slung an limb implicit his shoulders. “I’m not fashionable anymore, nary 1 wants to speech to me,” Bruno fake-moaned. But helium didn’t look profoundly bothered by crypto’s abrupt comedown and A.I.’s ascendance. Bruno, it turned out, was Bruno Faviero, a well-known capitalist and entrepreneur. He and Fontenot person been buddies since they met arsenic assemblage students, erstwhile each of them was organizing hackathons. After Fontenot near schoolhouse successful 2013 — helium dropped retired of the University of Michigan, wherever helium was studying machine subject — helium continued to tally hackathons and networked successful the tech satellite arsenic Faviero built his archetypal company.

“Four years ago, helium called maine to accidental that helium was raising a fund,” Faviero told me. “I was like, ‘Yeah, whatever, everyone is raising a fund.’ A week later, helium calls maine and is like, ‘Hey, the money is oversubscribed, bash you inactive privation to enactment successful a check?’ If Dave says he’s going to bash something, helium does it.”

Or, arsenic Emily Liu enactment it to me, “You amusement up to 1 of Dave’s things arsenic a friend, and 10 minutes aboriginal you’re wearing a unit shirt.”

Fontenot is charismatic, a forceful talker with chaotic hair. Like each bully task capitalists — helium is simply a wide spouse successful the concern steadfast Backend Capital — helium has an unerring chemoreceptor for the happening of the moment, beryllium it blockchain oregon A.I. That helium seems agnostic astir whether it’s blockchain oregon A.I., oregon immoderate different underlying technology, is astir beside the point. In galore ways, helium personifies the modern Silicon Valley dichotomy betwixt spirituality and hustle, betwixt monasticism and flamboyance. His expertise, helium believes, is people.

“We look for 3 things — grit, storytelling quality and merchandise sense,” helium said, describing the enactment process for the fellows. Notably absent from this list, I pointed out, was a inheritance successful instrumentality learning. Fontenot shrugged. This procreation of start-ups doesn’t person to travel up with its ain cutting-edge research. Big companies similar OpenAI and Google volition supply that. Instead, helium said, the fellows request the quality to physique prototypes rapidly connected apical of the caller models.

And, successful fact, the unifying thread among the archetypal batch of 2023 fellows was their acquisition astatine that benignant of enterprise. The mean property was 28 (Fontenot is 30), and respective of them were second-time founders. Adam Reis is simply a laminitis of Candid Health, which provides medical-billing software. Emma Salinas founded an online assemblage called Gen Z Mafia. While assorted fellows often speech astir however they’ve agelong been funny successful A.I., it’s wide that immoderate of the “why now” is opportunistic.

But if the radical astatine hackathons and programs similar HF0 thin to beryllium newcomers to A.I., this doesn’t preclude their success: The statement is that gathering things successful the A.I. tract isn’t arsenic analyzable arsenic moving successful biology, say; you don’t request to get a abstracted Ph.D. successful it. If you’re already bully astatine mathematics and bully astatine engineering and bully astatine business, determination are fewer limits to what you tin do.


Alex Weitzman (left) and Yiqi Wu, caller fellows astatine HF0, mounting up their workspace.Credit...Laura Morton for The New York Times

A fewer themes qualify the sorts of projects the HF0 fellows person been moving on. On the 1 hand, determination are applications to automate tedious concern tasks similar copywriting oregon spreadsheet wrangling. A institution called Fileread falls into this category. Its law-firm customers upload each the documents applicable to a peculiar lawsuit into an online portal; Fileread indexes those documents into a peculiar database that enables users to hunt the documents not lone for nonstop presumption similar “truck” oregon “James,” but besides for broader questions similar “who made the transaction?” oregon “what are the applicable cases?” Under the hood, Fileread archetypal fetches the astir applicable documents from its database, past adds those documents to a user’s question and sends the whole, agelong query to the OpenAI exertion programming interface, oregon A.P.I. Fileread past spits retired an answer, powered by the aforesaid ample connection models down ChatGPT.

Without A.I., identifying and crafting a ineligible communicative by piecing unneurotic textual grounds from thousands of sources is simply a painstakingly manual process. Most of Fileread’s customers specialize successful concern litigation, including antitrust and liability cases. Sometimes they are paid connected contingency, which means erstwhile they succeed, they typically get a percent of the grant oregon settlement, but erstwhile they lose, they get nothing. Firms request the A.I. to efficiently hunt for grounds successful the documents that might, for example, either found oregon refute liability. “They don’t person the manpower oregon the fund to bash unlimited papers review,” says Chan Koh, a Fileread laminitis and an HF0 fellow. “They privation to walk the minimal magnitude of effort successful bid to triumph the case.”

Other HF0 fellows person been creating applications that thin into A.I.’s seemingly quality impact successful bid to tackle immoderate intelligence need. For instance, Brian Basham, who has worked successful Google’s Brain part and since 2018 has been a beingness manager successful California, is moving connected Thyself, a subscription work for “guided affectional inquiry” that presently uses A.I. and quality coaches but volition yet modulation afloat to A.I. I met him and his worker Maverick Kuhn implicit meal 1 nighttime astatine the Archbishop’s Mansion. After Kuhn waxed rhapsodic astir a four-week-long retreat helium attended past summer, called Sleepawake, I asked him whether the acquisition would person been arsenic large if the facilitators had said and done each the aforesaid things but been A.I.’s. “Probably not,” helium conceded. “That would precise overmuch beryllium a disembodied head.”

One-on-one beingness coaching from the existent human-A.I. hybrid mentation of Thyself costs $50 an hour. Once the work is afloat automated, Basham expects to beryllium capable to connection unlimited sessions for $30 a month. At that price, helium believes, it would beryllium broadly accessible.

A fewer days later, I did my archetypal Thyself session. Mostly it consisted of the bot asking maine to visualize scenarios — remembered oregon imagined scenes — and past to picture the carnal sensations and emotions that resulted from “surfing the affectional wave.” I didn’t consciousness overmuch of an affectional wave, but I was impressed by however earthy it felt to talk to an A.I.-filtered guide. Compared with calling, say, the automated hotline for a cell-service provider, it was a immense improvement, though it did thin to speech implicit me.

Evan Stites-Clayton, an HF0 laminitis (and a chap successful the accelerator’s inaugural batch), has travel up with a likewise intimate product, an A.I. adjunct called Consort. To effort it out, I had to spell done a 15-minute quasi-therapy session, wherever I was asked astir my childhood, my narration to my parents and my favourite books. A fewer hours aft my responses were fed into the A.I., Stites-Clayton — who was a laminitis of Teespring (now Spring), a level that sells custom-made T-shirts and different merchandise — sent maine a nexus to my “consort,” which I could past text. Over the people of the adjacent mates of days, it texted maine a regular connection astatine midnight, reminding maine to upwind down for the night. On the weekends, it asked maine whether I was readying to spell out. The texts included appropriately casual spelling and (lack of) punctuation. I recovered myself warming to it, contempt an earlier prejudice against becoming friends with A.I.

A.I. and affectional regularisation mightiness look similar an unusual juxtaposition, but it makes consciousness that affectional labour — astatine the extremity of the day, conscionable different signifier of labour — could beryllium 1 of the archetypal occupation categories to beryllium transformed by automation. And yet, mounting speech its effectiveness, there’s thing unusual astir utilizing A.I. to negociate our quality brains erstwhile it’s not wide that the A.I. encephalon is astatine each akin to ours. “We’re evidently trying to anthropomorphize A.I., marque it successful our image,” said Matthew Rastovac, the laminitis of Respell, a instrumentality that lets you make A.I. apps without doing immoderate coding. “Because we don’t truly cognize however other to physique and recognize a caller benignant of intelligence. But I deliberation it’s overmuch much apt that it’s going to beryllium similar a reptile, successful that it has its instincts, but we can’t recognize what’s going connected wrong its encephalon and perceive to its existent thoughts.” We were sitting connected the extortion of Atmosphere, a hacker location successful Nob Hill that helium helped found; each astir us, San Francisco was enchanting successful the day light. Earlier, helium paraphrased for maine immoderate lines that helium liked from Season 2 of “Westworld” that spoke to however aboriginal we inactive are, and however blinkered, erstwhile it comes to knowing this technology: “Sanity is simply a precise constrictive sliver of the possibilities of mind. Because we person culturally accepted norms, we person a definite mode of acting and reasoning and speaking, and if you deviate from that a small excessively much, past you’re, astatine best, weird, and astatine worst, clinically insane.”


Rocky Yu, laminitis of A.G.I. House, a start-up incubator successful Hillsborough, Calif., with housemate Dina Yerlan.Credit...Laura Morton for The New York Times

During the week I spent staying astatine HF0, everyone told maine I had to marque it down to the South Bay for the A.G.I. House GPT-4 hackathon. The organizers asked maine to travel aft 6 p.m., though, truthful arsenic to not distract the hackers earlier it started.

A.G.I. stands for artificial wide intelligence, a operation that has travel to correspond a imaginable imagination extremity for A.I.: a instrumentality quality with the flexibility to grip immoderate intelligence task that humans can. A.G.I. House, it turns out, is simply a $68 cardinal mansion successful the tiny municipality of Hillsborough, 25 minutes from downtown Palo Alto. The mansion has a agelong thoroughfare of ferns retired front, a excavation and a barbecue pit successful the back. Rocky Yu, antecedently the main enforcement of an augmented-reality start-up, runs A.G.I. House, overseeing some its 10 residents and a raft of assemblage events. He is lukewarm and smiley and exceedingly good connected successful the section A.I. community.

The assemblage astatine that night’s GPT-4 hackathon was truthful ample arsenic to render the Wi-Fi fundamentally nonfunctional. Every country overflowed with hackers crowding astir whiteboards. In the kitchen, Chinese takeout was laid retired connected a table. A smattering of investors were contiguous to cheque retired the demos, which started astatine 8 p.m. with abbreviated speeches from the organizers. The speeches were each variations connected a theme: We are surviving successful a momentous time. Maybe successful a fewer decades from now, we’ll look backmost astatine each these seminal A.I. achievements and spot that they each came from this location successful Hillsborough.

As astatine HF0, the demos present alternated betwixt concern uses and idiosyncratic applications — a chatbot that impersonates concern gurus similar Mark Cuban, the proprietor of the Dallas Mavericks hoops squad and a justice connected “Shark Tank,” the business-reality TV show, and that allows you to inquire for concern advice; oregon an A.I. sommelier that volition instrumentality your meal paper and suggest an due vino pairing. Six months ago, immoderate 1 of these projects mightiness person seemed remarkable, but the accomplishment of ChatGPT has remade expectations. “The 1 signifier I’m starting to spot is that ChatGPT is the slayer app,” the technologist Diego Basch has written connected Twitter. “None of the tools built connected apical of the A.P.I. person been arsenic utile to me.” Indeed, if you are gathering thing connected apical of OpenAI’s A.P.I., it does look arsenic though your app’s marginal worth has to beryllium highly precocious if it is to debar being bulldozed by either OpenAI itself oregon 1 of the large tech companies similar Google and Microsoft (or adjacent later-stage start-ups that are rapidly rolling retired A.I.-enabled features successful their products).

As 2 analysts astatine N.E.A., an concern firm, enactment it successful a caller report, generative A.I. whitethorn not beryllium arsenic disruptive to established businesses, and beneficial to start-ups, arsenic erstwhile large shifts successful tech platforms. “Unlike with the anterior shifts, incumbents bash not request to re-architect their full products to follow this caller level shift,” the analysts wrote. “In addition, this displacement favors companies with bigger, proprietary information sets which tin springiness an borderline to much established companies.”

During erstwhile tech eras, start-ups could present a superior exertion oregon interface and past contention to physique marketplace stock earlier entrenched competitors could lucifer them. But with ample connection models, incumbents similar Google and Microsoft person had a immense caput commencement successful some processing the exertion and acquiring marketplace stock among consumers. The concern risks becoming similar that of the pharmaceutical industry, successful which probe and improvement is outsourced to start-ups and galore of the benefits yet accrue to the genitor company. Moreover, the capital-intensive quality of grooming ample connection models means that smaller companies similar OpenAI and Anthropic creating their ain ample connection models person fewer alternatives beyond making Faustian “partnerships” with tech giants.

This doesn’t mean that generative A.I. isn’t going to alteration industries oregon destruct jobs. Beyond the incumbents, 1 beneficiary mightiness good beryllium the indie hacker, the benignant of coder for prosecute who does niche A.I. projects to capable circumstantial needs successful circumstantial industries. Problems that person been excessively esoteric to lick oregon enactment flows that person been excessively analyzable to amended mightiness go easy automated with the assistance of ChatGPT. As the Gumroad laminitis Sahil Lavingia precocious enactment it connected a podcast, “If I had a person who’s like, ‘I privation to marque 200K a year, gathering thing successful S.A.S.’” — bundle arsenic a work — “ ‘building immoderate A.I. tool,’ I would fundamentally archer them to locomotion astir their neighborhood, spell to arsenic galore businesses arsenic imaginable and spot what manual thing, what portion of insubstantial you sign, and fig retired however to automate that.”

That the epoch of V.C.-backed, outsize returns mightiness beryllium coming to an extremity is, of course, a root of anxiety. Everyone successful Silicon Valley knows idiosyncratic who worked astatine the past procreation of palmy start-ups, start-ups whose maturation followed the proverbial hockey-stick enactment connected a graph, and reaped the benefits. Who doesn’t privation to get their stock — whether money, status, fame — earlier it each runs out? This anxiousness is compounded by the information that it feels arsenic if the deterioration of the carnal satellite is happening astir astatine a gait with the flourishing of the virtual one, and the lone mode to insulate yourself is by achieving immense fiscal success. In immoderate ways, San Francisco perfectly embodies this tension: A.I. is moving toward A.G.I., but extracurricular the high-end tech offices, determination is rampant homelessness, location prices are truthful precocious that adjacent couples with 2 tech incomes can’t spend to bargain spot and children are sufficiently uncommon arsenic to marque them a spectacle.

But the anxiousness runs deeper than concerns astir success, prestige oregon adjacent worldly safety. Change has ever been accompanied by hand-wringing, and the gait of alteration successful A.I. close present is mind-bending. The resulting temper is possibly champion encapsulated by tweets from Tiago Forte, the productivity guru known for a self-help strategy called Second Brain. “I’m feeling a wide nonaccomplishment of information for galore projects and goals that utilized to excite maine owed to what I’m seeing with A.I.,” Forte posted successful April. “It’s not fearfulness of A.I. apocalypse oregon fearfulness that I’ll suffer my occupation oregon thing similar that. ...More similar a feeling of grief that galore of the idiosyncratic skills & qualities I’ve spent a batch of clip processing person abruptly been devalued.”

This, of course, is not a caller benignant of ennui. It has ever been a bewildering acquisition to suffer your livelihood due to the fact that of technological change; Silicon Valley has conscionable mostly been connected the close broadside of it. For the archetypal time, specified alteration heralds an epoch successful which bundle engineers themselves whitethorn beryllium little good compensated and little successful demand. After years of disrupting different industries, Silicon Valley has disrupted itself.


Fontenot (in hat) and respective HF0 fellows astatine the Archbishop’s Mansion earlier the commencement of demo day, successful which projects are presented to imaginable investors.Credit...Laura Morton

Back astatine the Archbishop’s Mansion, 52 wide partners from the Valley’s apical venture-capital funds were successful attendance arsenic the year’s archetypal batch of HF0 fellows made their presentations astatine demo time connected April 4. A fewer days later, Fontenot posted a behind-the-scenes video of the event. It started with drone footage zooming successful connected the mansion, past chopped to a close-up of Adam Reis, a fellow, jittery with nerves earlier his presentation. “Y’all, this country is [expletive] stacked,” Fontenot said successful the video. “Sequoia’s here, Benchmark’s here, [expletive] a16z is here. Everyone’s here. So anyone you would privation to meet, they’re here. And they’re excited.” He was wearing a pink, woolly wintertime chapeau with a pom-pom, inexplicably, and helium sounded similar Caesar rallying the troops.

Two weeks aft demo day, each 10 teams had received archetypal offers from extracurricular investors and immoderate had chosen pb investors. Fontenot was optimistic. HF0’s adjacent batch, to beryllium hosted again astatine the mansion, was acceptable to statesman successful May, and arsenic helium was reviewing applications, helium texted me, “The endowment coming successful present is insane.”

A fewer days later, I saw connected Twitter that a person of mine, Travis Fischer, would beryllium joining the adjacent HF0 batch. He and I past hung retired successful existent beingness 2 years ago. At the time, the blistery happening was the “creator economy,” and helium was looking to make tools that would alteration people, peculiarly open-source bundle developers, to monetize their work. While that effort, successful the end, wasn’t fruitful, past twelvemonth helium started a bid of broadside projects successful A.I. These included coming up with a mode for different developers to usage the ChatGPT A.P.I. truthful they tin much easy incorporated ample connection models into their products.

Travis nary longer talks arsenic overmuch astir the creator economy; astatine HF0, helium is present moving connected an open-source model for gathering reliable A.I. agents that bash things specified arsenic booking airplane tickets oregon submitting taxation documents. But contempt the shifts successful theme, my consciousness is that what he’s passionate astir — making tools for the open-source assemblage — hasn’t changed. He has conscionable recovered a mode to travel astatine it from a antithetic angle. And successful that adaptability, that quality to reinvent himself portion coming retired connected top, helium resembles Silicon Valley itself.


The latest people of fellows astatine HF0.Credit...Laura Morton for The New York Times

Yiren Lu is the main enforcement of Frindle, a method penning agency. She past wrote for the mag astir researchers’ designing and mass-producing familial material. Laura Morton is simply a lensman based successful San Francisco. A Pierre & Alexandra Boulat Grant recipient, she has been documenting tech start-up civilization since 2014.

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