The ChatGPT Shake-Up A Cautionary Tale for Founders – Beware of Big Tech Blowing up Your Startup!

Small ChatGPT Update Serves as a Wake-Up Call for Entrepreneurs Big Tech's Power to Dismantle Your Startup in an Instant

– ChatGPT can now interact with PDFs and let you ask questions about them. – Changes like these could cause startups that build “wrappers” for AI chatbots to be edged out. – It’s a bleak reminder that swift rule changes by Big Tech firms can wreak havoc on smaller players.

Did OpenAI just slay a bunch of startups by making a rather small update to ChatGPT? Well, investors and founders better fasten their seatbelts and find out soon!

In a recent beta feature release, Sam Altman’s brainchild, ChatGPT, introduced a game-changing ability for subscribers: the power to upload PDFs. But hold on, it doesn’t stop there! This remarkable chatbot actually analyzes the files and allows users to ask questions about them. Say goodbye to the tedium of scrolling through hundreds of pages to extract nuggets of valuable information. It seems like a picnic in the park for lucky ChatGPT Plus users!

But, alas, every rose has its thorns. This update has created a much broader predicament. You see, some startups have built their entire business models around the fact that ChatGPT couldn’t interact with PDFs. So now that ChatGPT can, what can these other startups bring to the table? Well, the answer might just be… nothing at all!

AI-focused “wrapper startups” are now facing their comeuppance. According to Sahar Mor, product lead at payments titan Stripe, OpenAI’s latest move will wipe out dozens of AI companies. These “wrapper startups” are essentially businesses that wrap themselves around ChatGPT’s API, leveraging its core technology to offer services not directly provided by the API itself.

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Now, don’t assume that these founders are exploiting ChatGPT’s weaknesses. In fact, in March, OpenAI unleashed ChatGPT for developers to integrate into their apps and products. This means that PDF functionalities aren’t the only wrappers in town. There’s a whole shebang of them, each offering a diverse range of applications.

One notable “wrapper startup” that stole the limelight was Jasper AI, striding into 2023 with a jaw-dropping $1.5 billion valuation. Backed by heavyweights like Coatue and Bessemer Venture Partners, Jasper AI created an “AI copilot” uniquely designed for enterprise marketing teams, all by enveloping OpenAI’s GPT model. Unfortunately, this bright idea seems to be struggling as rumors suggest a decline in the company’s internal valuation, accompanied by layoffs. One can’t help but wonder if startups that thrive on user interactions with PDFs through ChatGPT may meet a similar fate.

Let’s take a moment to appreciate one audacious data scientist, Alex Reibman, who bravely launched ChatOCR—a ChatGPT plugin that miraculously “reads text from PDFs, including scans and handwriting.” However, in the wake of ChatGPT’s PDF-processing update, Reibman ran a poll that had everyone on the edge of their seats. Out of 210 respondents, a whopping 72.4% expected his plugin to “see less usage.” It’s crystal clear that, without a foolproof differentiator, startups are leaving themselves open to potential plunder.

Investors need to play their cards wisely. It’s high time they reevaluate their bets and make sure they’re not riding the wrong horse. So, let the showdown between PDFs and startups begin!

Hey readers! Have you ever struggled with extracting valuable data from tedious PDFs? What are your thoughts on ChatGPT’s game-changing update? Drop your comments below and let’s get the conversation flowing!

• ai
• ChatGPT
• OpenAI