Vinod Khosla: A Bullish Bet on AI, a Skeptical Take on Regulation
Vinod Khosla, the co-founder of Sun Microsystems and a prominent venture capitalist, has become a leading voice in the burgeoning world of artificial intelligence (AI). His early $50 million investment in OpenAI in 2019, a gamble that has paid off handsomely, has thrust him into the spotlight, making him more sought-after than ever by founders seeking his insights and guidance.
Khosla’s passion for AI is palpable, especially as he sees it reshaping the technological landscape. This dynamism is evident in his frequent public appearances, podcasts, and television interviews, where he routinely discusses the potential of AI to disrupt various industries, particularly healthcare and engineering. However, Khosla’s enthusiasm is tempered by a growing concern about the potential negative consequences of AI, and his views on regulation, particularly the role of the Federal Trade Commission (FTC), are decidedly more critical.
Apple’s OpenAI Partnership: A Validation of OpenAI’s Technology
Khosla’s bullishness on AI was apparent in his enthusiastic take on Apple’s recent deal with OpenAI to integrate ChatGPT, OpenAI’s flagship language model, into Siri and other generative AI tools. He sees the partnership, which is the only one Apple has publicly announced so far, as a testament to the power of OpenAI’s technology.
"It’s validation for OpenAI technology," he said, "because [Apple] could have gone with anybody" as a first partner. The announcement at Apple’s developer’s conference also underscores the company’s faith in OpenAI CEO Sam Altman as a leader in the field. Khosla believes Apple’s choice is a sign that "they don’t change it next year, usually."
The Disruptive Power of AI and the Rise of "Roadkill" Startups
While Khosla views AI as incredibly disruptive, he doesn’t believe that all of his portfolio companies will necessarily survive the inevitable wave of disruption. He acknowledges that many startups, especially those working in areas where AI is making significant progress, could become "roadkill" as large language models (LLMs) like OpenAI’s continue to advance.
He cites Grammarly, the writing assistant startup once valued at $13 billion, as an example. Khosla believes Grammarly, relying on a relatively simple application of current AI capabilities, will eventually be overtaken by the integration of AI into mainstream tools like Microsoft Word and Google Docs.
"If you’re doing Grammarly, say, it’s really a light wrapper on today’s model, and Grammarly won’t keep up; it should never have been an app," he said. "It shows the need for that capability, but it will be part of Word or Google Docs."
Opportunities in Vertical Expertise and the Need for "AI-Powered" Professionals
Despite the looming threat of disruption, Khosla sees numerous opportunities for new businesses in specialized fields where AI can provide expertise. He highlights the potential for AI-powered solutions in fields like tutoring, oncology, and even chip design and structural engineering.
"OpenAI or Google isn’t going to build a chip designer [to have on your smartphone]," he said. "They’re not going to build a structural engineer. They’re not going to build a primary care doctor or a mental health therapist."
Khosla emphasizes that entrepreneurs need to be thinking ahead, anticipating the trajectory of AI development and positioning their businesses to leverage those advancements.
Open Source: A Different Animal in the Context of AI
Khosla, a long-time proponent of open source software, believes that its application in the context of AI is a more complex issue. He acknowledges the strong role open source has played in technological innovation, citing Sun Microsystems, an early adopter, and Khosla Ventures, an early investor in GitLab, a software platform that promotes collaborative coding.
However, Khosla’s enthusiasm wanes when it comes to the open sourcing of large language models. He sees China as a primary threat, with the potential for its powerful AI to erode American values and economic dominance.
"The largest risk we face with AI is China," he said. "We need to make sure that China stays behind us."
Khosla’s Criticism of the FTC Chair and the National Champions Model
Khosla’s views on regulation are notably more critical. He dismisses the approach of FTC Chair Lina Khan, who rejects the "national champions model" – the idea of protecting domestic companies like Google and OpenAI to foster their growth – as a reason for government intervention.
Khan argues that the U.S. has historically benefited from a "path of competition," leading to innovation and economic growth. However, Khosla is not convinced. He labels Khan "not a rational human being" and accuses her of lacking business acumen.
"She shouldn’t be in that role," he said. "One thing the U.S. has over its European rivals is much more rational business environments. That’s why the Europeans have regulated themselves out of leading in any technology area; they just basically have regulated themselves out of AI, out of all social media, out of all internet startups."
The Looming Challenge of Income Inequality
Despite his optimism about AI’s potential, Khosla acknowledges the growing concern of income inequality. He worries that the massive economic growth fueled by AI could exacerbate existing disparities.
"I think 25 years from now, when I hope I’m still working…the need to work will mostly disappear," he said. "We’ll have enough abundance to share the wealth and share the benefits."
However, he expresses deep concern about the equitable distribution of those benefits: "How do we [ensure] the equitable distribution of the benefits of AI?"
Khosla’s observations highlight the complex and rapidly evolving world of AI. While he remains optimistic about its potential, he also recognizes the need for thoughtful regulation and the urgent need to address the potential for exacerbating income inequality. His views, though blunt and sometimes controversial, provide a valuable perspective on the challenges and opportunities that AI presents.
