Flash back to 2013. I had spent the past year rehabbing my torn achilles in New England under the guidance of some of the best doctors and trainers in America if not the world. At this world class organization, I was told that this would be a redshirt year. For non athletes that is a term used to describe a year where you don’t play but learn about the game, SOPs of the organization and continue to develop your body and mind. I spent the entire year learning everything there was to be about being a professional. Based on the information relayed to me by the organization, I was on the right track to be back on the roster. I had done everything that was asked of me and more. NFL Draft weekend came around and New England brought in another tight end. I saw it on the website and thought that healthy competition is normal in this line of work. I didn’t bat an eye. Monday afternoon at my locker, a personnel director came up to me and took me into the office of Bill Belichick. When he informed me I was being released from the team I asked, “Was it something I did? What could I have done differently?” He replied, “You did everything right. This tight end graded out higher than you (he is better based on our evaluations) and this is who we will move forward with as an organization.” I was escorted back to my locker, given a giant trash bag to put all my stuff in, I handed over my key fob and was escorted out of the building. After 10 years of dedicating my life to the profession of football, in one weekend and one organizational move, it was over. In spite of doing everything to the best of my abilities, I was replaced by someone better than me.
Right now I’m feeling that a large part of society is about to be replaced by ‘something’ better than them and people aren’t ready. I am not talking like the doomer reply on X or Instagram after seeing a chat gpt video saying things like “The end is near” then moving on with their lives. I genuinely believe that there will come a time when it will not make financial sense for a part of society to work. Permanent displacement. Let me explain what’s happening now, what’s to come, and a snapshot what the future looks like. First example of disruption comes from the BNPL company Klarna. On February 27,2024 they announced that their AI assistant powered by OpenAI after one month of operating did all of this:- Had 2.3 million conversations, 2/3s of Klarnas customer service chats- one AI agent is estimating to be doing the work of 700 agents- Satisfaction score equivalent to humans- 25% drop in repeat inquiries due to more accurate errand resolution- Level 1 Customer requests are now resolved are now resolved in 2 minutes compared to 11 minutes- Available in 23 markets, 24/7 and communicates in 35 languages- Driving an estimated $40 million USD profit improvement for the year 20241 agent for 700 people, 24/7. Truly incredible numbers and they speak for themselves. Before, disruption looked like taking a call center and moving it to India or the Philippines to cut costs. Now you just install a chatbot LLM fine tuned on your company data and it eliminates a majority of Level 1 customer service positions. With AI, the disrupters are getting disrupted. That is currently happening. Yesterday, Cognition AI released a video showing an AI agent autonomously coding out a project on Upwork. Here is the video:
Up until this point in time coding was largely viewed as a hard skill and one of the most sought after skills. Everyone has an opinion on what good marketing looks like but code is different. Most people look at a few lines of code, give up and pay a company with 7 team members to build it. There are 27 million software developers in the world and I am sure more in the college ranks. What does the software developer role look like in 2-3 years? Here a graph showing the price discrepancy between a years salary for 1 human developer compared to 1 AI agent developer.
Once these agents are more capable, what saas CTO is going to onboard a team of 7 software developers? Not only are the Agent more capable, they are cheaper, they do not need mental health days or a team of back office of HR support. It will be one experienced developer leading a team of 6 agents building software round the clock with a 90% margin instead of 20%. You may be thinking, well thats code, computers are build on code, of course we lose that battle. And chatbots are just juiced up LLMs with enhanced pattern recognition. Well just today OpenAI released their robot Figure 1 built on an open AI Neural Net.
Brad come on talking robots aren’t new. What is new is the neural net. Let me explain the difference between Machine Learning (Chat GPT) and Neural Nets (Figure 1)Machine learning is a broad field of artificial intelligence that involves teaching computers to learn from data. It encompasses various techniques, and algorithms, ranging from simple linear regression to complex ensembles of decision trees. Neural networks, on the other hand, are a specific type of machine learning model inspired by the structure of the human brain. They consist of layers of interconnected nodes or "neurons" that can learn complex patterns in data. While all neural networks are a part of machine learning, not all machine learning methods are neural networks. Simplified, Machine learning is a way for computers to learn from data and make decisions or predictions. Neural networks are a specific type of machine learning that learns by mimicking how the human brain works (think memories). After watching this video and seeing how the robot interacted with multi layered requests, how long before it doesn’t make sense to have waiters or waitresses? It may not make sense now but in 10 years, I could see it happening. Goodbye tipflation. I believe that no one is completely safe in their job, as AI can enhance various aspects of any role. The best thing for people to do is to arm themselves with the technology that is available and weaponize it to increase your value and productivity. Consequently as this technology develops, more companies are adopting AI into their business models to increase revenue, reduce costs, or both. In most cases that means jobs done by humans. As this is broken down, it becomes more clear that we're facing a substantial societal shift over the next few years. Similar to my experience in New England, in time, many people will reach the day when they are replaced something that simply "grades out higher."
