Speaker 1: Bloomberg Audio Studios, podcasts, Radio News.
Speaker 2: Now want to get into a big conversation this morning.
Speaker 2: We are in the midst of London Tech Week. Lizzie,
Speaker 2: you'lso out and about founder's forum British AI business. Double
Speaker 2: Word the UK's first dedicated inference lab. It's one of
Speaker 2: the first companies that has been backed by the UK
Speaker 2: Government's Venture Fun for domestic AI startups. We've spoken to
Speaker 2: the Air Minister about this and I'm really delighted that
Speaker 2: we have Meriam Eric, who is the co founder and
Speaker 2: CEO of double Word, in the radio studio with us.
Speaker 2: Welcome to Bloomberg Radio. Yeah, Meriam, I know that you've
Speaker 2: been right at the heart of this government activity with
Speaker 2: London Tech Week. You've been to Downing Street already. How
Speaker 2: do you think about the government's announcements in terms of
Speaker 2: helping businesses like yours?
Speaker 1: So the government is taking a very different approach to
Speaker 1: how UK governments have typically treated the tech sector. So
Speaker 1: typically UK governments have had a very hands off approach,
Speaker 1: and unfortunately most of our competitive countries don't have a
Speaker 1: hands off approach. And almost every single generational business that
Speaker 1: has ever been built has had a very hands on
Speaker 1: interventionist approach from their governments and so for the first time,
Speaker 1: what we're seeing from this government is wanting to back
Speaker 1: the strategically important AI companies of the future and really
Speaker 1: back them so that they not just start here, which
Speaker 1: plenty of companies do, but also stay here and scale
Speaker 1: here so we can really build generational companies in the
Speaker 1: UK as well. But are you taking what the Starma
Speaker 1: administration is saying seriously when there's so much speculation about
Speaker 1: who's going to be the Prime minister and for example
Speaker 1: Andy Burnham, the Great Manchester may is talking about more
Speaker 1: regulation on tech. Yes, I think the tech sector gets
Speaker 1: painted with a very broad brush. I think it's very
Speaker 1: like the Keir Starmer administration as well also wants a
Speaker 1: lot of regulation on big tech and social media. But
Speaker 1: I think that it's very different to the very innovative
Speaker 1: startup companies and scale up companies that are kind of
Speaker 1: British at its core, and they want to keep British
Speaker 1: and they're really putting kind of their money where their
Speaker 1: mouth is, and they've we are part of a five
Speaker 1: hundred million dollars sovereign AI fund. We have received a
Speaker 1: compute allocation from them. They've also recently announced two days
Speaker 1: ago a one point one million pound fund to procure
Speaker 1: computees so we can build more supercomputers in this country.
Speaker 1: And so it does seem like they're taking this very
Speaker 1: very seriously. Although something I'm worried about is a change
Speaker 1: in government will lead to a change in the ministers
Speaker 1: in the Department of Sites and Technology that we think
Speaker 1: have been doing a very good job.
Speaker 2: Okay, okay, some praise then for those ministers. I mean
Speaker 2: that the issue though, with picking the winners and losers
Speaker 2: in the in the UK simply that Britain isn't spending
Speaker 2: very much money. I mean, if you look at the
Speaker 2: trillions of dollars being used for the kind of infrastructure
Speaker 2: build out in the US, it pales into infra significant.
Speaker 2: But to understand that, it's sort of trying to pick
Speaker 2: the winners in terms of double word though, and you've
Speaker 2: got the backing of government, so that's one thing. Also
Speaker 2: that they are going to help you with that compute
Speaker 2: which is very important and very costly for startup businesses.
Speaker 2: How quickly are you managing to grow though? I mean,
Speaker 2: inference basically allows companies to use AI to make AI
Speaker 2: work for them, and that is massively important for growth
Speaker 2: in brit How fast you're scaling up, What are your
Speaker 2: customers actually saying about whether they are doing good things
Speaker 2: with AI exactly?
Speaker 1: I think, as you say, the government doesn't have a
Speaker 1: huge amount of money to throw around, and so they're
Speaker 1: being very strategic in how they give this money out.
Speaker 1: Something that I've been particularly impressed with is the choices
Speaker 1: when they're deciding which startups to back. It's VC professionals
Speaker 1: and investment professionals that are choosing those companies, and not
Speaker 1: necessarily like government civil servants, and so they are very
Speaker 1: selectively picking a couple of strategically important winners. US. For example,
Speaker 1: we are a dedicated inference lab. The problem of tokens
Speaker 1: and token costs is going to be a huge issue
Speaker 1: in the UK, especially given how expensive are energy bills are,
Speaker 1: and so they've picked just a couple of companies that
Speaker 1: they think can really play in this space. It's not
Speaker 1: like they're picking, you know, every AI application level company,
Speaker 1: because actually there's also plenty of VC funding to go
Speaker 1: around as well. We are predominantly VC backed and we
Speaker 1: aren't taking money from the government. Just kind of compute
Speaker 1: where they can be strategically important.
Speaker 2: I mean, you've raised as far as I can make
Speaker 2: out a little over twenty six million dollars when you're
Speaker 2: backed by Dawn Capital, by Oxford's venture Atomic and so
Speaker 2: that idea though, staying in Britain, building in Britain, staying
Speaker 2: in Britain. Yes, Now what happens later as the business grows?
Speaker 2: Would you be committed to staying in the UK.
Speaker 1: Yeah. The common pattern that we see is that Britain
Speaker 1: is great at starting businesses. We have great pedigree, so
Speaker 1: we are kind of Oxford, UCL cac L scientists and
Speaker 1: we start in Britain. The issue is is that Britain
Speaker 1: doesn't necessarily have our customers. A lot of our customers
Speaker 1: are abroad and are in the US, and so what
Speaker 1: we often see is company starting here but then moving
Speaker 1: abroad and then scaling abroad. And that's specifically the challenge
Speaker 1: that this government is trying to stop. We think, and
Speaker 1: we've committed to building our R and D tech cubs
Speaker 1: in the UK and in London because we think there's
Speaker 1: fantastic talent to benefit here and I would like to
Speaker 1: think of the UK as more than just an R
Speaker 1: and D hub, but also as a place where we
Speaker 1: can have great customer relationships, firstly with the government but
Speaker 1: also with businesses as well.
Speaker 3: For our markets audience Burrium. I'd love to just point
Speaker 3: out a figure that was in the TechNation report this week.
Speaker 3: Thirty percent of UK tech leaders say that AI is
Speaker 3: a bubble. If you're in this bubble, if it is one,
Speaker 3: what's your view on that, is it going to burst?
Speaker 1: Well, if it is a bubble, then it's an incredibly
Speaker 1: productive one. It doesn't look like the bubbles that we
Speaker 1: we saw in the two thousands. This bubble kind of
Speaker 1: is a bubble of valuations potentially, but actually it seems
Speaker 1: like this is largely being backed up by revenues by
Speaker 1: all of these big players. We're seeing record breaking and
Speaker 1: revenue growth from the likes of Anthropic Open AI in
Speaker 1: video and others as well, and so obviously there will
Speaker 1: always be some winners and some losers, as there are
Speaker 1: adventure but actually this is being backed up by real
Speaker 1: revenue for these businesses.
Speaker 2: It's not really delivering productivity growth in the UK. But
Speaker 2: then maybe that's also because we're right at the beginning
Speaker 2: of this. I suppose again, what are you offering your
Speaker 2: customers because part of the package is you know, you're
Speaker 2: talking about global customers and customers in the US, but
Speaker 2: part of this idea is allowing sovereignty in AI, allowing
Speaker 2: a kind of ring fenced AI for businesses that they're
Speaker 2: not so reliant on global US best based businesses. How
Speaker 2: do you balance that the idea of delivering sovereign AI.
Speaker 1: So the biggest problem in AI at the moment is
Speaker 1: the problem of inference and the problem of tokenomics. And
Speaker 1: so that is the problem of like, how do you
Speaker 1: actually run these models and how do you actually run
Speaker 1: them in a way that is semi affordable. So at
Speaker 1: double World, we've been thinking about token costs for a
Speaker 1: very very long time. But only a couple of weeks ago,
Speaker 1: Uber announced that it had blown through its entire AI
Speaker 1: budget or by April, so in four months, it had
Speaker 1: blown through twelve months of budget. Because that is just
Speaker 1: how expensive AI has turned out to be to adopt
Speaker 1: for some businesses. And that's the problem we're trying to solve,
Speaker 1: is how can we allow businesses to adopt AI at scale,
Speaker 1: but also do so in a way that's affordable and
Speaker 1: in a way that they can control.
Speaker 3: Well, it's interesting that Anthropic's got the token model. I
Speaker 3: wonder if you have thought strong opinions on Anthropic versus
Speaker 3: Open AI, because of course the IPOs are coming at
Speaker 3: the same time.
Speaker 1: Roughly yeah, and they're both incredibly impressive businesses. And only
Speaker 1: yesterday we saw Anthropic release a new model which was
Speaker 1: a version of that much reported Mythos model that everyone's
Speaker 1: been talking about. It seems in terms of capability there's
Speaker 1: really not much between them. I would say at the moment,
Speaker 1: there's probably slightly wider adoption amongst businesses for Anthropic, but
Speaker 1: open AI seems to have much more consumerttraction, and so
Speaker 1: they're really really neck and neck. But also I do
Speaker 1: believe that there's space for both, and I think it's
Speaker 1: very healthy that we have both in healthy competition there.
Speaker 1: But also we are very strong believers in open source
Speaker 1: models as well, and so we actually think open source
Speaker 1: models are going to play a bigger role in the
Speaker 1: AI landscape than some people currently believe.
Speaker 2: How in terms of the UK, how close the EU
Speaker 2: has a different kind of regulatory structure. How close is
Speaker 2: the UK to the EU? I mean you say that
Speaker 2: there's plenty of VC money in the UK, How are
Speaker 2: you thinking about Europe in the contest of the US
Speaker 2: compared to the US. I suppose now about that again,
Speaker 2: that kind of sovereignty idea of the UK and Europe.
Speaker 1: So I think London and the UK really stands apart
Speaker 1: in terms of the amount of VC investment we have.
Speaker 1: So in Q one we had record amounts of VC
Speaker 1: investment in AI startups. I think it was five point
Speaker 1: eight billion dollars, and so we are kind of out
Speaker 1: competing our European neighbors, although there are very strong AI
Speaker 1: companies in Europe as well, namely like Mistral and Lovable
Speaker 1: for example. But when we think about sovereignty in this country,
Speaker 1: I don't necessarily think about it in terms of as
Speaker 1: a competition between any other country. I think about it
Speaker 1: as what do we need to make sure that we
Speaker 1: can keep the lights on when things if things go
Speaker 1: pair shaped? And what that means is we need, you know,
Speaker 1: lower energy costs in this country, We need more data
Speaker 1: centers in this country, and we need you know, inferant
Speaker 1: software and you know, great model companies as well, so
Speaker 1: that we can run that AI you know in this country.
Speaker 1: If the worst were to.
Speaker 3: Happen, well, yeah, the Bank of thing the Governor Andrew
Speaker 3: Baileys want the AI main I need to be rationed
Speaker 3: because of the energy capacity constraints. And you know governments
Speaker 3: facing these choices between deploying AI and healthcare versus defense
Speaker 3: versus other sectors. How far off are we from those
Speaker 3: sorts of decisions.
Speaker 1: It's an incredibly good question. And at the moment some
Speaker 1: companies are having to ration their usage because of how
Speaker 1: expensive they are finding it, and it is particularly a
Speaker 1: problem in the UK because of our energy costs. One
Speaker 1: of the projects that we've been doing on is and
Speaker 1: barred the UK supercomputer is at dou World. We've been
Speaker 1: doing a lot of research in how can we make
Speaker 1: this supercomputer more efficient for producing tokens such that we
Speaker 1: can make the most of the limited kind of energy
Speaker 1: and limited money that we have, so we can get
Speaker 1: the most out of it so we don't have to ration. Otherwise,
Speaker 1: if we don't look at efficient inference, then we will
Speaker 1: have to ration this AI and that is not going
Speaker 1: to be good for anyone.