Category: Business
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2024 Week 18

Notes, thoughts and observations - Compiled weekly

Justice? Maybe not but at least a judge called B.S. on Adam Neumann’s plan to buy WeWork out of bankruptcy. He was told to pay off the $4b debt first, and ostensibly everyone he owed money to. An article out of the Wall Street Journal (paywall) that confirms population decline. Record low birth rates aren’t new but mainstream acceptance that it will influence economics is. Again, I don’t think it’s a gloom and doom crisis, but it will change things.

A lot of news out of Artificial Intelligence this week. I highly recommend the latest edition of The Pragmatic Engineer newsletter for all the juicy details. Are LLMs hitting the “Napster” moment of licensing? Several lawsuits by IP holders seems to indicate.

Microsoft teased a new web-based version of CoPilot that builds on GitHub Codespaces and provides an intersection between CoPilot web and GitHub CoPilot. In the demo you can see the prompt engineer explain the concept and the LLM expands the idea and ultimately generates code.

This is a different approach than Devin or Magic.dev which aim for the moon shot of taking input and generating code without intervention. I won’t ignore that Microsoft has deep enough pockets to fund this project longer, I also think they are trying to gain market share early by producing tools that make developers more productive, rather than replace them.

TOPICS

Bankruptcy

OPINION - Thankfully consequences for Neumann who essentially ran the company into the ground

  • (AXIOS)
    • WeWork strikes deal to exit bankruptcy, without Adam Neumann
    • Company co-founder and former CEO Adam Neumann is not involved, despite having wanted to buy back his former company.
      • Neumann’s $650 million buyback offer was via Flow, an apartment rental startup he launched with big backing from Andreessen Horowitz.
    • Yardi Systems, a property management software provider and WeWork service partner, would become the company’s new majority owner with around a 60% stake.
      • Longtime WeWork backer SoftBank also is involved in the deal, which would eliminate WeWork’s $4 billion in debt.
    • The bottom line: The bankruptcy court judge told Neumann’s attorneys that his effort was largely irrelevant if he wasn’t first willing to pay off the $4 billion debt load.

Population

OBSERVATION - Corroborates the theory of population decline

  • (Wall Street Journal)
    • American women are giving birth at record-low rates. The total fertility rate in the U.S. fell to just 1.62 births per woman in 2023, marking the lowest rate recorded since the 1930s

AI and ML

OPINION - This is a Napster moment for AI model training. Start of the downward valuation of building ubiquitous models.

  • (AXIOS)
    • Eight regional U.S. newspapers—owned by hedge fund Alden Global Capital—on Tuesday sued OpenAI and Microsoft for copyright infringement.
    •  include the Chicago Tribune and New York Daily News
    • The New York Times filed a similar lawsuit against the two tech companies in December._
    • Google to pay News Corp. up to $6M annually to develop AI content, products
      • The deal is part of a longer partnership between the two companies, the news outlet added, citing a News Corp. employee and person close to the deal.
      • “We absolutely do not have an AI content licensing deal with Google, though we do have a number of partnerships with Google across our businesses,” a News Corp. spokesman told Seeking Alpha.

OPINION - Might be the killer feature that pushes some developers to web based IDEs

  • (Pragmatic Engineer)
    • GitHub’s AI-assisted developer workflow vision: Copilot Workspace.
    • Several startups are aiming to build an AI coding tool that goes beyond GitHub Copilot.
    • With exceptionally fast execution, GitHub seems to have beaten them to it. It’s called GitHub Copilot Workspace, and doesn’t aim to replace devs.
    • A review of this developer-driven, AI-assisted workflow, including insider details from the GitHub team.

OPINION - Microsoft going for market share

  • (Pragmatic Engineer)
    • Do nearly 1 in 10 developers use GitHub Copilot?
    • Microsoft CEO Satya Nadella announced that GitHub Copilot has 1.8 million paying subscribers.
    • A year ago, 45% of Fortune 100 companies were using GitHub Copilot. Now, it’s 90%.
    • Assuming GitHub Copilot’s growth continues, could 10% of all living software engineers be using GitHub Copilot?
    • Microsoft has become a clear leader in this category, with Google, Amazon, Apple, and Meta without their own competing offers.
    • “If a copilot generates $10b of revenue [hinting at GitHub Copilot], how much is a colleague worth?”

OPINION - It’s a moonshot and will probably run out of money eventually.

  • (Pragmatic Engineer)
    • Devin didn’t solve Upwork job, says dev who posted it
    •  Cognition Labs launched Devin (the world’s first AI developer, apparently) with the claim Devin has successfully solved real Upwork jobs
    • A machine learning engineer who posted the job on Upwork reported:
      • “I’m a very good fit to do this evaluation, not only because this is a computer vision channel and I’m a computer vision expert, but also because I am the client who posted this on Upwork. The solution given by Devin in this video is not really the type of deliverable I was expecting.”

OBSERVATION - Startup tools still able to raise, but funding is rebounding from previous drought. A rising tide?

  • (Pragmatic Engineer)
  • Massive AI dev tools startup funding rounds
    • While GenAI startups show signs of cooling, two AI coding tool startups do not.
    • Cognition AI – the creator of Devin – raised $175M funding at a $2B valuation, only 6 months after being founded and a month after a $21M Series A.)
    • Augment AI, a secretive coding startup aiming to be a GitHub Copilot Rival, raised $252M Series B funding (at a $1B valuation), but no product is announced as yet.