Even the AI godfather warned about the dangers and developments in the field.

Emma Dennard, VP Northern Europe, OVHcloud has been here through technological transformations from 3G, 4G, 4G and now 6G, but has never seen anything move as quickly as AI is moving. Emma is proud to have a startup programme at OVHcloud, a European cloud provider operating over 450,000 servers.

Emma notes that whilst ChatGPT acquired 100,000,000 users within two months of launching in November 2022, Pokémon Go reached 100,000,000 users within just 33 days of launching. Both exceptional results of course, but the point is, the real value of ChatGPT and generative AI is yet to be extracted.

That being said, Emma recognises the importance of collaborating with the startup ecosystem to shape the future of AI.

Big ticket customers are leading the AI backlash

The lived experience of big tech products driving the emergence of generative AI has also happened at scale and at a velocity we’ve not seen before. Shân Millie, Founder of Bright Blue Hare said: “As with other negative aspects, like Surveillance Capitalism, people don't necessarily like what they see and experience. And what's really interesting for me is that this time, it's the corporates -- the big-ticket customers for BigTech -- leading the backlash.”

Samsung Electronics banned the use of ChatGPT and other AI-powered chatbots by its employees, joining a growing list of firms cracking down on the workplace use of AI services. And we can see global regulatory activity hotting up.

“The bandwagon rolled so hard, the wheels are starting to come off already,” Shân added.

What we’re seeing is a redefinition of what it means to be commercially sustainable.

“Tunnel vision on market-share battles between Microsoft, Google and others trumped the basics of responsible innovation, and seemedly overrode considerations of what happens to your bottom-line when your customers lose trust, indeed, see your products as (too) risky.”

For the early-stage firms we heard from at the OVHcloud Startup Programme Showcase, there were some very clear messages from the funders, on- and offstage.

• Choose your foundation models carefully
• Choose your Tech stack partners even more carefully
• When it comes to LLMs, talk small, not big.

Life is already tougher for startups in 2023 than it has been for probably 10 years or so, and the message was clear that what funders want to hear is less about the tech and more about a differentiated, distinctive solution to a well-understood and verifiable customer challenge or problem.

“I think that can only be good for sustainable growth of innovative early-stage firms,” explained Shân.

What else is in store for startups?

Of course, others have a different view of what sustainable refers to in this context. Aaron Jones, Co-Founder of Yepic AI states that businesses need to focus on scaling, but ensure safety remains paramount as sustainability is about releasing things in a responsible way.

Similarly, Franki Tabor, Founder of FashionAI believes now is the ideal opportunity for more white label generative AI solutions from brands. She also believes its important to decide which tools you want to use and understand how that data is being used.

What is clear is the opportunity for growth in the sector over the next six months.

Focus however, should not be taken away from the importance of regulations and understanding data usage policies, and using AI in a responsible way. Therefore, Franki highlighted the importance of a strong legal ethics team.

What’s also clear is that to become a leader in this space businesses don’t necessarily have to create the next ChatGPT. The key to growth is APIs and having models and partnerships with the companies who have become leaders, enabling existing market players and not necessarily creating a new platform. Aaron added that opensource is changing everything in a way he’s never seen before.