The AI-Enabled Entrepreneur

April 20, 2024

Building companies is an incredibly challenging, multifaceted endeavor that requires a broad range of skills and a bit of luck. Whether you’re starting a dental practice, a design agency, or a SaaS company, success isn't one-dimensional. It's not just about providing the best service or building the best software; it's also about finding and retaining customers, among many other business operations that scale as you grow.

I've started two venture-backed companies in the last 11 years and have also built side projects just for fun. While I can't speak for all types of companies, I'm quite familiar with the tasks required of a software startup at the earliest stages and what it takes to be a founder. Not to overly cite from the Book of Y Combinator, but it's pretty simple—”all you do” is build the product and talk to users.

When I started my first company, URX, at 25, I had only a basic understanding of product, software, and marketing. I was passionate, knew how to sell, and had some design and business training from college.

I started URX with three co-founders: Andrew and James, who were software engineers, and Nate, who was a designer. In those early days, I spent most of my time talking to users and translating that into requirements for what we should build, and ensuring our customers were successful.

When Nate, Andrew, and I decided to start Aesthetic, we were excited to bring our band back together with more experience under our belts. Nate had improved his sales and frontend coding skills, Andrew had honed his product management skills, and I had become more technical. This arrangement allowed me to add more value in the product design process and also assist more with testing and marketing collateral.

A few months ago, I decided to help a friend with a side project and was able to design, build, and deploy the first version of the app myself before hiring a software engineer on Upwork to build the rest of it. While I have grown more technical and improved since Aesthetic, the real change in my leverage is due to my tooling.

Today, I am truly 200x+ more capable as a coder than I was three years ago at Aesthetic. In the last few years, I may have become a 2-3x better programmer, but LLMs and modern web technologies have provided a 10-20x increase in my capabilities.

Beyond coding, I’m also 3-5x more efficient in many other key founder activities (ie creating marketing collateral, system architecture, go to market execution) because of more experience and how I’ve integrated generative AI tools into my workflow (how I did this is probably something I’ll write about in the future).

GenAI as a founder amplifier

Today, while still incredibly young as a technology, LLMs have exceeded human performance on many intellectual tasks already. It doesn't take an expert to see the trends these developments hint at for the near future.

It's impossible for anyone to truly grasp the full ramifications of this shift, but as a professional deeply involved in this field, I am certain of two things: These are still the early days, and it's going to get much better very quickly.

It's easy to think that a major implication of this is that many people will lose their jobs and that we won’t need as many jobs in the future. Instead, I believe—and certainly hope—that something different will occur.

While I, and many others, believe that a set of jobs will be fully replaced within the next five years, these will pale in comparison to jobs where only a part is automated by AI. Furthermore, there will be a massive increase in new entrepreneurs who are using this technology to start businesses more easily, quickly, and affordably than ever before. This, in turn, will lead to a whole new wave of demand for jobs, and the cycle will continue to repeat.

We're entering the age of the AI-Enabled Entrepreneur, who is able to leverage generative AI to dramatically enhance their effectiveness at creating a company and rely less on other people or capital to build and monetize their ideas.

The Craftwork Era of Software Startups

Being able to build an early version of a product myself fundamentally changes everything about how I thought about building software products. Pre-GPT4, I did not have the skills to build and launch a web app so I’d need to convince or pay someone to help me. Instead, I was able to get it working end-to-end and pay a freelancer on Upwork $10K to finish it.

In a Pre-GPT4 world, I would estimate it’d have cost me $50-60k to hire freelancers to build what we shipped. In effect, I was able to reduce my MVP cost by 80%.

Personally, $10k and $50k are very different considerations when talking about a self-funded side project. Being able to lower the cost so dramatically changes the prospects of what I see as possible and how I think about building startups.

I was going through my Figma account lately and came across a whole bunch of wireframes for discarded product ideas from Aesthetic. In hindsight, I could see many of them that I thought could become $1k-$10k MRR SaaS businesses. Nowhere near anything big enough to be considered appropriate for a venture-backed business, but incredibly exciting if you had a side project that was bootstrapped (read: you own 100% of it).

Before, I would have never built that startup idea because it seemed “too small” to work on. But now, ideas like this that would have otherwise ended up on the cutting room floor take on a whole new shape.

Where This Goes

There are 330k new businesses started every quarter in the United States, and I believe it will hit 1M by 2030. The barrier to starting software businesses has lowered dramatically and will continue to do so.

While not all businesses are software businesses, software continues to be adopted across every global industry which means more software will also make it easier to start other kinds of businesses.

Looking ahead

LLMs and modern web technologies have reshaped the landscape of entrepreneurship. These tools not only significantly reduce the cost and complexity of starting a new business but also enhance the capabilities of founders at every level. With barriers lowering and opportunities growing, the era of the AI-Enabled Entrepreneur is upon us. The only question remaining is, "What's stopping you from becoming an AI-enabled entrepreneur?"

Thank you to Andrew Look and Sumon Sadhu for giving feedback on early drafts of this post.