> The first solo-founder unicorn isn’t built by a genius doing the work of three hundred people. It’s built by one person sitting at the center of a coordination layer that does the work the three hundred people mostly used to do... What’s new is AI that scales a single person’s coordination capacity, attacking exactly the cost the gig economy couldn’t.
Two problems with that:
1. AI isn't free, and how cost-effective it is remains to be seen.
2. AI can't currently really do the full job of one person, let alone three hundred [1]. And when it is able to do the job of three hundred people, the very structure of the economy is likely to change so much that any transfer of details from the existing economy to that imagined one may well be irrelevant. In other words, at the point AI is able to do something so transformative, it's unreasonable to think that the structure of one company will be revolutionised without everything around it also being revolutionised.
It stands to reason that the economic value that one person can do with a relatively cheap tool (assuming that the AI that could do all that is cheap enough) will be similar to whatever one person could do with a relatively cheap tool at any other point in time. An increase in productivity in the presence of competition lowers the price of the product by about the same factor as the increase in productivity. People have more stuff, but not necessarily more money. A person with a laptop and a 3D printer might be a "unicorn" if they were transported back in time to 1526, but it doesn't make them a unicorn today because many other people can do that, too.
[1]: So much of the old grunt work in the knowledge economy is already automated (typing, copying, posting letters), and so three hundred people are probably doing some non-trivial work already, and replacing them means AI with much better capabilities than we have today.
> An old fish swims past two younger ones and nods. “Morning, boys. How’s the water?” The two swim on, and after a while one of them looks at the other and asks, “What the hell is water?”
We live in an invisible substance called air but we still know what it is
I still have the same question about this that I have every time someone proposes it: If there is some hurdle that AI solves that means someone can create a highly profitable business alone, why should someone pay that business to solve whatever problem it solves instead of also getting the AI to solve it? Like if implementation becomes less and less of a barrier, that implementation is also less of a moat, and thus at least software companies per se would seem to not be of much value compared to just having access to the same AI people use to build them. This would basically require a permanent high barrier to access to AI to work out, which to be fair, may be the future a lot of these silicon valley prognosticator types might be hoping for, but if that doesn't happen, which seems more likely, the value of companies resets to whatever assets they can leverage, and at least software, if not any strategic or technical advantage an AI could help with, no longer is a source of surplus value
I already think valuation is a very gameable metric, so I guess you could trivially get this done if you meet a VC who will just buy you a billion dollar valuation on the belief that this is a real thing. I know some enthusiastic kids in the world I could maybe throw a thousand bucks at to buy a GPU in exchange for a millionth of their company, and technically wouldn't that make them a one-person unicorn already?
> why should someone pay that business to solve whatever problem it solves instead of also getting the AI to solve it?
well because presumably even in that brave new world, solving the problem with AI is still not trivial, even if it requires just one person. If a potential customer wants to solve it themselves instead of buying, they would have to find the right person, invest in his time and tokens, and end up with a custom solution they'd have to support.
What do we consider trivial? What are we measuring effort by? Yes, people have different skills from each other, and different resources they might have differential access to, but the value of the business is constrained by that differential, and we are purporting that a technology can build you stuff with the effort of only one person that somehow still supports a business worth billions of dollars? How much more effort does it have to take to build something before you'll pay for it? Pay how much? And if people are making companies without hiring employees, how much can how many people pay for it in the first place?
Also worth noting that you don't gotta do much to support software (or any solution) that only one person uses
There is a big difference between capturing value and creating value. 20 developers can build and maintain a facebook or reddit clone, so why aren't they kicking the asses of the big companies with the much higher costs?
First mover effects, network effects, brand recognition, corruption, rent-seeking over the assets created by the aforementioned
Like, yes the main point of leverage obviously isn't software quality, but also, if AI can't cause one person to be able to solve those other problems at some scale that's currently not possible with no other human help, those problems become problems someone else could also throw the AI at. If running a business relies on having some point of market leverage over anyone who pays your business for something, the reduction of the cost of independently gaining that leverage necessarily means the reduction of the value of your business
I guess another possible means to a single-person company with a billion dollar valuation is hyperinflation
> Within a few years, someone will build a company worth a billion dollars alone. One equity holder. No real payroll. A single person at the center of work that used to take a few hundred people
Does Mojang (Minecraft) count? Because if so, the first solo founder unicorn was made almost two decades ago.
> If that load can be carried by software instead of by the founder’s inbox and memory, then the ceiling on how many external relationships one person can command rises by an order of magnitude. And that’s the variable Coase’s boundary actually turns on for a would-be solo operator. The market got cheap years ago. What was missing was a coordinator who didn’t run out of attention.
I literally cannot believe you can get to a billion dollar valuation without at least a small sales team. AI cannot do that no matter how much you coordinate and your customers will not talk contract details with a bot.
And yes ofc Sam Altman (dude who sells tokens) thinks people should form solo companies that literally runs on the tokens he and his friends sell. That is not a tell or a signal as this article makes it out to be.
Yeah sure AI can optimize work but this ignores basic realities of running a business of that size.
You can have billions of valuation even without having any real product. It’s just make believe sometimes. Remember Nikola and Milton? There’s a solo founder for you. 30 freaking Bs.
Two problems with that:
1. AI isn't free, and how cost-effective it is remains to be seen.
2. AI can't currently really do the full job of one person, let alone three hundred [1]. And when it is able to do the job of three hundred people, the very structure of the economy is likely to change so much that any transfer of details from the existing economy to that imagined one may well be irrelevant. In other words, at the point AI is able to do something so transformative, it's unreasonable to think that the structure of one company will be revolutionised without everything around it also being revolutionised.
It stands to reason that the economic value that one person can do with a relatively cheap tool (assuming that the AI that could do all that is cheap enough) will be similar to whatever one person could do with a relatively cheap tool at any other point in time. An increase in productivity in the presence of competition lowers the price of the product by about the same factor as the increase in productivity. People have more stuff, but not necessarily more money. A person with a laptop and a 3D printer might be a "unicorn" if they were transported back in time to 1526, but it doesn't make them a unicorn today because many other people can do that, too.
[1]: So much of the old grunt work in the knowledge economy is already automated (typing, copying, posting letters), and so three hundred people are probably doing some non-trivial work already, and replacing them means AI with much better capabilities than we have today.
Claude fingerprints are becoming easier to detect
We live in an invisible substance called air but we still know what it is
I already think valuation is a very gameable metric, so I guess you could trivially get this done if you meet a VC who will just buy you a billion dollar valuation on the belief that this is a real thing. I know some enthusiastic kids in the world I could maybe throw a thousand bucks at to buy a GPU in exchange for a millionth of their company, and technically wouldn't that make them a one-person unicorn already?
well because presumably even in that brave new world, solving the problem with AI is still not trivial, even if it requires just one person. If a potential customer wants to solve it themselves instead of buying, they would have to find the right person, invest in his time and tokens, and end up with a custom solution they'd have to support.
Also worth noting that you don't gotta do much to support software (or any solution) that only one person uses
Like, yes the main point of leverage obviously isn't software quality, but also, if AI can't cause one person to be able to solve those other problems at some scale that's currently not possible with no other human help, those problems become problems someone else could also throw the AI at. If running a business relies on having some point of market leverage over anyone who pays your business for something, the reduction of the cost of independently gaining that leverage necessarily means the reduction of the value of your business
I guess another possible means to a single-person company with a billion dollar valuation is hyperinflation
Does Mojang (Minecraft) count? Because if so, the first solo founder unicorn was made almost two decades ago.
I don’t think it counts. It was close but Notch founded Mojang and worked with others for a few years before the sale.
I think it could have counted though. I think Notch created a lot of the momentum himself.
I literally cannot believe you can get to a billion dollar valuation without at least a small sales team. AI cannot do that no matter how much you coordinate and your customers will not talk contract details with a bot.
And yes ofc Sam Altman (dude who sells tokens) thinks people should form solo companies that literally runs on the tokens he and his friends sell. That is not a tell or a signal as this article makes it out to be.
Yeah sure AI can optimize work but this ignores basic realities of running a business of that size.
Craigslist came close! and that was before AI.