The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:12:31 · Harry Stebbings, Satya Nadella
[00:12:31] S1: me, is how a firm works. I love this private eval's benchmarks for each company. This is for a rarified air of companies, so it would seem. Your Harvey's or your Lagoras or the kind of very forward thinking AI companies. Will that disperse to every company in the world you mentioned? [00:12:47] S0: It happens. Yeah. It happens, Harry, always. Right? Which is, you know, there were... There was a day when remember in the late '80s and the early '90s that the few companies that had deployed PCs and were doing forecasting, which felt magical, they were able to put it in Excel, spreadsheets, send it in email, and avoid the fax machine and interoffice memos. And it felt like, Oh, wow, when will this happen? And it took ten years maybe, and it spread all throughout. This time around, what is considered, Oh, I'm an AI native company and I do this, I think five years from now, it'll be pretty passe, I would imagine. And then that's kind of what... I mean, these tech cycles always start like that, right? Which is even cloud. Remember in the beginning of cloud, it was like the big deal was, oh, who's cloud native and who's not? And you know, if you're not cloud native... And now everybody is. Right? Even Lloyd's, you know, which is, what, 500 years old, is cloud native. And so it happens. Do we move into
00:12:47 · Satya Nadella, Harry Stebbings
[00:12:47] S0: It happens. Yeah. It happens, Harry, always. Right? Which is, you know, there were... There was a day when remember in the late '80s and the early '90s that the few companies that had deployed PCs and were doing forecasting, which felt magical, they were able to put it in Excel, spreadsheets, send it in email, and avoid the fax machine and interoffice memos. And it felt like, Oh, wow, when will this happen? And it took ten years maybe, and it spread all throughout. This time around, what is considered, Oh, I'm an AI native company and I do this, I think five years from now, it'll be pretty passe, I would imagine. And then that's kind of what... I mean, these tech cycles always start like that, right? Which is even cloud. Remember in the beginning of cloud, it was like the big deal was, oh, who's cloud native and who's not? And you know, if you're not cloud native... And now everybody is. Right? Even Lloyd's, you know, which is, what, 500 years old, is cloud native. And so it happens. Do we move into [00:13:40] S1: an implementation economy then? Because when we think about these customers, say, as you said, some of you are very big customers, they will need heavy FTE support much more so than they have done in traditional years or in the last ten years. Will we have a very heavy implementation economy to transition existing customers into this?
00:13:40 · Harry Stebbings, Satya Nadella
[00:13:40] S1: an implementation economy then? Because when we think about these customers, say, as you said, some of you are very big customers, they will need heavy FTE support much more so than they have done in traditional years or in the last ten years. Will we have a very heavy implementation economy to transition existing customers into this? [00:13:58] S0: It's interesting, right? The implementation economy, like systems integrators have always existed, right? We've depended on implementation economy for lots of other technology diffusion. So this one, I think, has different contours, right? Because- do [00:14:13] S1: think is different about this one?
00:14:13 · Harry Stebbings, Satya Nadella
[00:14:13] S1: think is different about this one? [00:14:14] S0: It's the combination of tech and business, if I could say. But it's not classic management consulting, it's not classic systems integration, and it's not classic technology support. For example, think about this. You want to start. When I look at my FD engagements, right? Even take the Unilever example I talked about at the keynote today. It's fascinating. They built an agentic system to say, Hey, we want to really have order to cash automated using an agentic system, plus their trade claims. And by the way, they started using a frontier model, and then they substitute for, in fact, I think they're using currently an MAI model for all the trade claims because it's sort of a lower cost. By the way, they control it, right, because they're able to train on their traces. And so we had some FTEs, but a lot of who got deployed, and now their IT team itself is managing it all. But it started with what's the business, what's the eval, what's the way to conceptualize the agentic architecture? So it's sort of business consulting combined with technical consulting. And I think, yeah, you're right in saying that there will be a new set of skills that'll get built in the ecosystem. Today, I think all of us have, quote unquote, our own but FTEs will become like... You know, the traditional systems integration will become new FTE. You've mentioned, obviously, MAI.
00:15:34 · Harry Stebbings, Satya Nadella
[00:15:34] S1: Yeah. But when we look at a lot of different players, it's kind of this realization that you need to be full stack from chips to models to application. Is that the future you have to have vertical ownership? [00:15:45] S0: Yeah. It all depends on the industry structure. Right? You know, I think that I would say today, you know, there'll be, who knows, five, six closed models all competing, maybe five, six, open weight models all competing. And so therefore, at some level, if you're building an application like the AgenTeq system, you could even have something like what I said, which is a router with even a decision engine built into it. And then you just route to the best model for a given task. So that's a possibility. Of course, there's always the risk that NEMET could be one vertically integrated model and app tier and all the way to the silicon and system. It's unlikely to me. I thought at some point that it might be the case that there will be one. If anything, it's going the other way, which is every day you wake up and you say, Wow, there's more competition in every layer of the stack, whether it's in silicon, whether it's in systems to manage the silicon, in the model layer, in the app layer. And so I think that's a healthy sort of direction of travel, but you never know, right, because this is one of those things where it all depends on what becomes the dominant design. But my hope is that this becomes a little bit of a horizontal specialization with multiple winners in each layer and then the ability for people to compose.
00:15:45 · Satya Nadella, Harry Stebbings
[00:15:45] S0: Yeah. It all depends on the industry structure. Right? You know, I think that I would say today, you know, there'll be, who knows, five, six closed models all competing, maybe five, six, open weight models all competing. And so therefore, at some level, if you're building an application like the AgenTeq system, you could even have something like what I said, which is a router with even a decision engine built into it. And then you just route to the best model for a given task. So that's a possibility. Of course, there's always the risk that NEMET could be one vertically integrated model and app tier and all the way to the silicon and system. It's unlikely to me. I thought at some point that it might be the case that there will be one. If anything, it's going the other way, which is every day you wake up and you say, Wow, there's more competition in every layer of the stack, whether it's in silicon, whether it's in systems to manage the silicon, in the model layer, in the app layer. And so I think that's a healthy sort of direction of travel, but you never know, right, because this is one of those things where it all depends on what becomes the dominant design. But my hope is that this becomes a little bit of a horizontal specialization with multiple winners in each layer and then the ability for people to compose. [00:17:02] S1: The thing I didn't see is the depth of each layer. Like, what I know now that I wish I'd known twelve months ago, it's just like the infinite demand for inference. [00:17:09] S0: Yeah. That's a great point.