Speaker 1: Well, was that a venture partners They invest in what
Speaker 1: is called AI first companies. We're talking about artificial intelligence.
Speaker 1: Those are companies and entrepreneurs that are applying machine learning
Speaker 1: to the real world across the industries and functionality. So
Speaker 1: let's get into it with Ash Fontana, managing director of Zetta.
Speaker 1: Before Zetta, he launched syndicates at angel List, his new
Speaker 1: book The AI First Company, How to Compete and Win
Speaker 1: with Artificial Intelligence, and Ash getting up early joining us
Speaker 1: on the phone from Sydney, Australia, where it's I think
Speaker 1: six thirty in the morning. Nice to have you here,
Speaker 1: Welcome to Bloomberg. Thank you so much for having on
Speaker 1: your side. Well, it's a pleasure. How are you and
Speaker 1: tell us about this past year, um, covid this book.
Speaker 1: What's it been like? Mm hmm, Well, I'm well it
Speaker 1: was it was sort of a funny year, and that
Speaker 1: it was a good year to write a book, um
Speaker 1: to the inside and whatnot, um and finishing all those
Speaker 1: all those loose ends that they're just lying around in
Speaker 1: your house when you see you doing nothing else. So UM,
Speaker 1: it was a good year in that regard. It was
Speaker 1: a very funny year to be in the field of
Speaker 1: artificial intelligence, because uh, you know, we've all heard this
Speaker 1: from a few different people, but the acceleration was incredible,
Speaker 1: and the imperative to automate as the sort of imperative
Speaker 1: to get a better understanding of what's going on in
Speaker 1: our world when we couldn't be out in the world
Speaker 1: UM really increased, and so that the right into adoption
Speaker 1: of these technologies really want through the root, meaning what like,
Speaker 1: give us some examples of things that because I do
Speaker 1: think ash it's fair to say that for a lot
Speaker 1: of people, and I'm not making a judgment call, but
Speaker 1: when we think of AI, it's often guided by Hollywood
Speaker 1: interpretation of it, or we think about you know, controlling
Speaker 1: our minds UM. But it's already in our world and
Speaker 1: it's making decisions about things. M Yeah, indeed it is.
Speaker 1: And I think there's two aspects of this UM to
Speaker 1: bring it down to sort of really examples, you know.
Speaker 1: One is what do you do when there aren't people
Speaker 1: around the aren't have people in close contact with each
Speaker 1: other in a place like a warehouse, Well, you have
Speaker 1: to use the machine. So firstly, understand what people would
Speaker 1: be doing that warehouse or the usual process let's observe
Speaker 1: it with some cameras and try to break it down
Speaker 1: with some sort of system that analyzes the feed from
Speaker 1: those cameras. Um. And then too, how do you move
Speaker 1: things around when there are people there to do that?
Speaker 1: People can't be there to do that, it's not safe
Speaker 1: for them to do that, and to use robots, and
Speaker 1: robots are funny. That's sort of like a system that
Speaker 1: has lots of different bits of artificial intelligence in it.
Speaker 1: So you know, that's one sort of pretty tangible example.
Speaker 1: But you know what else happened last year was just
Speaker 1: seven these systems were used. Whether they were energy systems
Speaker 1: like electricity good, whether they were economic systems like what
Speaker 1: happened in markets, they just started, um doing things you
Speaker 1: haven't seen them do before. And you know what artificial
Speaker 1: intelligence really is, I know people think of it a
Speaker 1: lot on the time. Is something that you know, is
Speaker 1: like a weird sort of mind. Um, It's really just
Speaker 1: like a bunch of physical models strung together. And so
Speaker 1: when all these systems started going awry, and I really
Speaker 1: helped us understand what's going on by doing statistical analysis
Speaker 1: on the flow of power through degrees when no one's
Speaker 1: striving to work and everyone's staying at home. Why what
Speaker 1: was happening there? How do we actually manage better how
Speaker 1: we move energy around the grid in that situation that
Speaker 1: we've mada sine before while and AI can sort of
Speaker 1: very quickly make a new model that helps you generate
Speaker 1: a prediction in that new world rather than you have
Speaker 1: to rely on your old models that were used to
Speaker 1: generate predictions under normal uses usage patterns of electricity. UM.
Speaker 1: So it's really good at doing things like that, and
Speaker 1: the advantage to it is that it's constantly able to
Speaker 1: take in and make those decisions using real time data.
Speaker 1: So as the data can change, as we saw a
Speaker 1: year ago or a little bit more than a year ago,
Speaker 1: the data points changed dramatically. Nobody would have predicted it initially,
Speaker 1: right until, of course we started to see how significant
Speaker 1: and how severe the pandemic was. But that's the advantage
Speaker 1: of AI. Yeah, that's exactly right. UM. You know a
Speaker 1: lot of these systems are trained in an environment that
Speaker 1: represents a real world environment. But every time they get
Speaker 1: a new observation, every time they take a new photo
Speaker 1: of what's on a shelf and supermarket or what's how
Speaker 1: things are moving around the warehouse. Will they make an
Speaker 1: observation of how power is flowing through the grid, you know,
Speaker 1: it's flowing to this part of the grid and not
Speaker 1: that part of the grid. It learns and it updates
Speaker 1: the view of the world. Now we do that too
Speaker 1: as humans. Of course, we're always updating out view of
Speaker 1: the world. But you know, we're actually very hesitant to
Speaker 1: update out of view of the world because, um, we
Speaker 1: like being able to make decisions quickly based on instinct,
Speaker 1: and that requires having very solid models of the world.
Speaker 1: Whereas AIS don't sort of has that bias. They don't
Speaker 1: have that recency bias, so to speak, and they don't
Speaker 1: have that need to be super intuitive about things. So
Speaker 1: they're updating the view of the world very very quickly,
Speaker 1: and that can be really helpful. And in the situation
Speaker 1: so as what is an AI first company because you
Speaker 1: invest in them, Yeah, and and our first company is
Speaker 1: a company that genuinely puts AI artificial intelligence to start
Speaker 1: every conversation, in the conversations about who they're going to
Speaker 1: hire next, you go to hire people that you know
Speaker 1: can build these models, build these these machine learning models
Speaker 1: that eventually start looking like AIS. You know what Are
Speaker 1: you going to put your money until you're gonna put
Speaker 1: your money into acquiring valuable data? What policy concerns do
Speaker 1: you have? Are you really going to play a role
Speaker 1: in the data own data privacy? Are first companies really
Speaker 1: put these conversations first so that they can genuinely build
Speaker 1: this stuff rather than try to sprinkle it on top later.
Speaker 1: So are these the company? So help me out here?
Speaker 1: Are these the companies who are creating the AI infrastructure,
Speaker 1: the AI algorithms? Because it sounds like we are moving
Speaker 1: increasingly to a world where you know, every company, just
Speaker 1: like retail became kind of a digital e commerce company,
Speaker 1: had to adopt some kind of digital strategy. We saw
Speaker 1: that a lot in the pandemic or companies in general.
Speaker 1: Is it Are we moving towards a world where every
Speaker 1: company is going to have some type of AI strategy
Speaker 1: or AI first strategy? Yeah? I really think we are.
Speaker 1: You know, the way you put it there, I think
Speaker 1: it's how I would put it um and that is
Speaker 1: all software will eventually become intelligent. Every bit of technology
Speaker 1: that we use will have a bit of a conicutve
Speaker 1: element to it. And in court we've seen so far
Speaker 1: as a couple of really nice companies get started, like
Speaker 1: UI Path and Palanteer and clubd Error and a couple
Speaker 1: of these companies that have gone public. Now you know
Speaker 1: they're really making the tools that other people build their eyes. Um,
Speaker 1: they're not really a access companies themselves. They're not building
Speaker 1: the AI s. But you know, now that they're really
Speaker 1: well established and their products are mature, people can use
Speaker 1: them in retail, in manufacturing, in healthcare to build their
Speaker 1: own aies in those fields, combining their own experience of
Speaker 1: how things work. You know, how diseases progress, how consumers
Speaker 1: behave with the power of these models to get a
Speaker 1: predictive system underway. But what to give me an idea
Speaker 1: because you do have some investments and I've been looking
Speaker 1: at your website earlier today, tell me what is an
Speaker 1: AI or what are some of the AI first companies
Speaker 1: that you have invested in, and just give us an
Speaker 1: idea of what they're doing, just so that our our
Speaker 1: audience and the ssters that are out there, because this
Speaker 1: does sound like something that will become more popular potentially
Speaker 1: going forward. Yeah, for sure. I think A really good
Speaker 1: example is a company called Tractable, and what they do
Speaker 1: is they basically help people get back on their feet
Speaker 1: after being a disaster, you know, whether that's a weather
Speaker 1: disaster or having a car crash. And the way they
Speaker 1: do that they analyze images. So you have a little
Speaker 1: fender vendor on the way to work, you take a
Speaker 1: photo and they can analyze that photo a naked decision
Speaker 1: almost on the spot about whether your car is going
Speaker 1: to be repaired or whether it's a write off. And
Speaker 1: that just gets the money in your account more quickly.
Speaker 1: It gets you back on the road more quickly, and
Speaker 1: it for the insurance company makes the cost of process
Speaker 1: in that claim a lot lower. And you know how
Speaker 1: is that an AI first company, They had to for
Speaker 1: two years before they got any customers, really go and
Speaker 1: collect so much datas, so many different images, different ways
Speaker 1: in which cars go through crashes, and how different panels
Speaker 1: deform and whatnot, so that they could train their models
Speaker 1: to the point where they can develop a really accurate
Speaker 1: readoubt of the damage really quickly, just purely using computer
Speaker 1: vision and not using getting a loss adjuster or having
Speaker 1: someone come out and have a look at the car.
Speaker 1: How much is that being used by the insurance industry,
Speaker 1: the auto industry at this point. Yeah, it's being used
Speaker 1: today by major insurers all around the world to make
Speaker 1: decisions every day. Um, and then you know, you can
Speaker 1: see how it could soon be used for other other purposes.
Speaker 1: You know, if you're in a hail storm and your
Speaker 1: riot gets damaged, well, they can take a photo from
Speaker 1: space or from a drone and then analyze that photo
Speaker 1: and quickly give you an assessment of the damage and
Speaker 1: processes you're playing. You can see how it could be
Speaker 1: used in all sorts of the types of situations. But today,
Speaker 1: dozens and dozens of the world's largest insurance company these
Speaker 1: working with them to process claims every single day, and
Speaker 1: it's in the hands of people in their apps that
Speaker 1: they've got on their phone and their their insurance company apps.
Speaker 1: One thing I do want to ask you, because when
Speaker 1: we're taking images pictures up above, I mean, I'm thinking
Speaker 1: that there are some of our listeners or watchers on
Speaker 1: YouTube that are just saying, well, wait a minute, Okay,
Speaker 1: So now I start to get a little thinky about
Speaker 1: AI and then the privacy concerns. What are the boundaries
Speaker 1: that need to be set with these AI first companies. Yeah,
Speaker 1: that's a great question, and you know, I'm all for
Speaker 1: thinking about the role of government here as being a
Speaker 1: really important one because in a sense, as as individuals
Speaker 1: our data, my data, your data in itself is not
Speaker 1: necessarily worth much, but as a collective data is worth
Speaker 1: a lot to these companies. And you know, we can
Speaker 1: work with government to make sure these companies respect our
Speaker 1: privacy where they need to and properly compensate equal for
Speaker 1: their data, um when they when they use it. I
Speaker 1: think the EU is a real leading light here. Um.
Speaker 1: You know, recently they released some legislation where they just
Speaker 1: outright bands and applications I around facial recognition and whatnot,
Speaker 1: and I think there are categorically some really scary uses
Speaker 1: of it. And you know, we do have the power
Speaker 1: through the legislature the branded stuff, um, but you know,
Speaker 1: besides a couple of sort of very clear cases, it's
Speaker 1: a more marginal consideration. And you know, I think having
Speaker 1: better standards for auditing, being more upfront about what data
Speaker 1: we're using, you know, with the cookie stuff that's hit
Speaker 1: the news today, I think that's a really good approach.
Speaker 1: But you know, looking to the EU and what they're doing,
Speaker 1: I think an indication of what government do. Well look
Speaker 1: forward to having you back and maybe at a time
Speaker 1: where you don't have to get up so early, because
Speaker 1: I do think this is an interesting area, uh and
Speaker 1: certainly one that continues to development and really be a
Speaker 1: part of our world. More broadly, Ash, thank you so much.
Speaker 1: Ash Fontana, managing director of Zetta the his book The
Speaker 1: AI First Company, How to Compete and Win with Artificial Intelligence,
Speaker 1: joining us on the phone from Sydney, Australia,