The consumer founder’s secret AI master plan:

As we know, 2025 is the year of agents.

Much has been said about relationships with AI agents as a new moat.

BUT

The big platforms of tomorrow will be what I call, “Trusted Recommenders”👀👇🧵 1/6 AI changes the strategic moats, revenue & profit generation of Internet companies. Intimate AI x human relationships, via trusted AI agents, will emerge across many consumer verticals and apps.

Let's start from what the consumer's user journey is today, and what it becomes with AI.

before AI (h/t @cdixon):
User →
Device →
OS →
Internet access →
web browser or App Store →
purchase intent discovery and generation →
purchase harvesting →
delivery of goods and/or services

after AI:
User →
Device →
OS →
edge user data collection and interaction →
Internet access →
web browser or App Store or agents →
purchase intent discovery, generation and harvesting →
delivery of initial good/service →
ongoing AI service or relationship, and continued user data collection

What’s changing due to AI:
1. Individual data, aggregated user base level data, and industry/domain specific data collection and injection into end user experience will unlock a new set of consumer paradigms.
2. Companies purpose-built with this data DNA will accrue compounding advantages due to network effects.
3. There’s a first mover advantage for companies that execute this right.

The changing user journey affects a company’s strategy, moats, business model, and future revenue and profits.

Owning early positions in the user journey allows a company to win by directing or redirecting the attention of consumers. For example, the Apple App Store can feature or bury any app, and Google’s SEO can rejigger any site’s search rank.

Companies later in the user journey compete and win based on best-in-class user experience capturing maximum attention, which translates to individual user trust and market-dominant brand position. For example: users go directly to Google or Meta’s suite of apps, rather than going through the App Store. Users go directly to Pinterest, Amazon, Meta or eBay’s sites rather than navigating through Google Search.

“Trusted recommenders” are the big platforms of tomorrow

These companies will bundle discovery and purchase intent generation (influence) with transactions; completing the entire purchasing loop from discovery to value capture. The most successful ones will be vertical fullstack-apps that extend customer relationships beyond the transaction and initial hero product to adjacent key decisions and products.

Before AI, network effects were measured in user adoption. Now, network effects will be measured in enduring user trust.

Adoption is easy and fleeting, trust is hard and durable.

To gain initial trust from consumers, companies need to solve a huge and necessary pain better than all alternatives. But to maintain and deepen trust, companies need to continuously listen to the user, make the user feel seen, and sometimes solve other problems for them.

AI provides a big unlock: there is a new way to build trust now. How? Through forming authentic, personalized, and continuously engaged relationships with end users. With AI, the marginal cost of building deep relationships with users and extending those relationships over time is effectively zero (just inference costs).

From a product perspective, AI-first products can collect significant personalized user data on intent, taste/preferences, and decision making parameters and tailor products to taste. In the AI era, user-generated code and subsequent product interface is the new UGC (used-generated content in the pre-AI era).

As a consumer, you experience having a companion with full context of you in a given domain, perfect memory of your past experiences, preferences and considerations, engaging and disengaging at your whim to your style and tone. AI-first apps will build a perfect model of you and deliver a right-fit experience at the right-time.

To use a retail analogy, luxury sales associates, client relationship managers, and special customer experiences such as personalized events are now economically possible for all companies, even if the business is in a low margin or low AOV industry. Marginal costs before AI: you hire a salesperson and even pay commission; you hold events and hire marketers to engage and even re-acquire customers. Now: inference costs.

Learning + education is one of AI’s first consumer use cases. How we obtain knowledge, consume content and learn, and what skills and knowledge are valuable will change dramatically in the age of AI. Here's 5 predictions for how AI will change the future of education and knowledge + blog post linked👇

How a company gets its first 1,000 users often isn’t what will get them its next 10k or 100k users.

Founders need to realize early GTM channels are often not scaleable, and that’s OK. So, how should consumer companies think about GTM in the 0 to 1, pre-PMF stage?

Read on👇 At @a16z, I’ve seen many promising ideas given up too early or getting fixated on a single acq channel.

There are lots of creative ways to find users. Instead of jumping on TikTok the new hot channel, startups should tailor their channels to their users and product.

Over the past decade, $20B has been invested into US edtech, yet only 3 companies have gone public: @coursera, @duolingo, @udemy. Many have written off the space.

🔥take: we are entering the decade of the “Learning Economy,” which spans way beyond traditional education. More🔽 1/ First, #edtech is much broader than we think. It's not just about academic tools and student/teacher tech. The Learning Economy, as we think of it, encompasses all the diff ways we develop as human beings, be it learning to be a better boss, parent, or friend, or a new hobby.

4 moats for subscription businesses 👇.

@netflix announced it lost 200k subscribers as the market for streaming is heating up...what are characteristics of subscriptions people don’t cancel? 🧵 1/ Daily habit or core part of life - faith (@glorify_app ), music (@Spotify), productivity (iCloud, @NotionHQ), shopping discounts that “pay for itself” (Costco, @amazon Prime, @scottsflights). Existing habits make it so retention + engagement come naturally for good products.

Most digital creators are now on 5+ platforms - each with its own medium, content and visual style. They are often on-the-go, not working in front of desktops. Yet they need one place to share announcements, news and beyond with their fans. Enter @beaconsai: Beacons is mobile, modular, “smart” site-builder that takes second and a few clicks to set up. Creators can customize the design exactly to their own style. Beacons’ vision is to help creators monetize and build their businesses - the biggest challenge in the creator economy now.

Why is creator economy exploding now?

Here's the story of one of the brightest examples in the space - @APompliano, and why there will be more solo-preneurs in the next decade, read on 👇 1/ The early years of Pomp's life & career seem similar to that of the rest of us. He played in the system of established institutions: went to college at Bucknell, then joined the US army and spent time at Facebook as a PM. Along the way he got into angel investing and crypto.

Inspired by conversations with friends new to venture capital...over the years I’ve received excellent advice on how to hone my skills as an investor without a long operating career.

Here's what I learned so far 👇 1/ Develop a personal strategy based on what you do better than anyone else. For example, @turnernovak is the best meme-maker, communicating where he sees consumer trends going. @mercebent is a pro at finding markets/ themes others are not looking and she has unique expertise in.

Thread: How do you make 💸💰 as a social startup? 

Many hesitate to launch social companies because of monetization or because they think ads are the only way to go…founders, this post is for you 👇


a16z.com/2020/12/07/soc… 2/ It's true, ads have been a fantastic way for the large social networks to make money @Facebook @Twitter @Snapchat @instagram @Google. Thanks to those giants' reach and significant investment, that's made it hard for most startups to compete head-on. So what can startups do?