The hottest topic in recent times is nothing more than ChatGPT, which is almost a state of screen brushing from the circle of friends, Weibo and various media videos. ChatGPT is a chatbot developed by OpenAI, an American artificial intelligence research laboratory, which introduces the training method of feedback reinforcement learning (RLHF) to predict the questioner's intention and expected answer, and gradually improve the quality of the answer by scoring and sorting each answer. ChatGPT assists humans with a range of tasks, such as writing emails, revising resumes, creating copywriting, and generating code. While there is still room for improvement in accuracy, there is no doubt that this is a major breakthrough in artificial intelligence.
The debate over how AI will affect businesses and individual employment is raging. In fact, the world will never lack the so-called "outlets", such as the meta-universe, Web 3.0 and NFT a year ago, which have attracted public attention, but have not really achieved effective commercial landing so far. After the boom, investors and companies gradually left the market. Looking at today's ChatGPT, although the application ideas based on its AI capabilities are endless, how to commercialize it is still being discussed and explored, whether it is a "wind outlet" or another tool for harvesting market "leeks" is still unknown.
In this era of belief in seizing the wind and pigs flying, the "success studies" related to entrepreneurship have emerged one after another, attracting groups of entrepreneurial dreamers to flock to the battlefield of independent entrepreneurship at the beginning of the wind, firmly believing that their entrepreneurial projects will be sought after and favored by capital with a keen sense of smell. However, mature investors often evaluate the success rate of project investment from the following three directions:
1. Think about whether you have insights far beyond others: ideas that can disrupt the original market landscape and create blue oceans
2. Think about why only you can make this money: evaluate unique resources and sustainable competitive advantage
3. Prove that your team has strong execution: Cultivate the morale and discipline of an iron army
01
Insight beyond others: Recognize the gap between concept and commercialization
Anyone who has ever started a business or worked as a product manager knows that conceptualization and actual commercialization are two very different things. Concepts, or vents, are based on a "trend of the times", usually derived from a specific era background and technological breakthroughs. A fresh concept wants to generate business value and form effective business opportunities, first requires entrepreneurs to have insight far beyond others, and it is possible to seize the opportunity to earn excess returns.
After all, it is obviously unwise to seize the market share that has long been carved up by business giants in the original market, and to rush to attack from the front, so entrepreneurs must find another way to have the possibility of victory. Every time the wind is outlet, it may bring an opportunity to reshape the industry pattern, or it may be an opportunity for heroes in troubled times.
But this is also the most common trap for most people to fall into – focusing too much on "insights" and ignoring the difficulties that may be encountered in the actual implementation process. There are many entrepreneurs who dream big business as if they can achieve great things with disruptive ideas, but few end up succeeding. Why is this happening? Because it is always difficult to practice dreams on a down-to-earth basis, and high-talk can easily become a boastful talk on the wine table. The situation is like people always like to watch fake moves in football matches, but ignore the hard days of hard training for players every day, and the key to victory is often the inconspicuous "basic skills" of players' fitness and teamwork.
"There is never a shortage of good business ideas, what is lacking is fast and effective execution." In the same way, commercialization is to have actual products or services for customers to buy, consider input and output, and bring positive cash flow to enterprises in the future and create value for society. At this time, we must not only consider our own basic conditions, including financial capacity, social relations, supplier resources, technical team, etc., but also formulate specific strategies, such as target market, product portfolio, pricing, marketing, customer acceptance, etc. In the actual landing process, there will be various problems and challenges at each execution node, and these are exactly what most entrepreneurial dreamers are unwilling to face.
Taking the metaverse as an example, after the concept is hot, many players enter the layout. The most famous of them is Facebook (Facebook), which has not been able to clarify the application scenarios of commercialization since it changed its name to Meta to focus on the development of the meta-universe, but has reported negative news of large-scale layoffs. Bloomberg sees this as a case of failure in trying too much to find outlets. As you can imagine, investors are not satisfied with its development.
02
Why only you can make this money: rationally analyze your own strength before commercialization
Even if you have insight far beyond others and find the application landing scenario, this is only a prerequisite for commercialization. After filtering out most mediocre speculators, the players who are left at your level are the ones you really face. At this time, the information war of "knowing oneself and knowing oneself" - finding out what level of one's own strength and resources is, realistically evaluating competitors and market size, accurately judging the execution required to realize one's dreams, etc., are all hard power needed to improve the odds of victory.
There are countless companies that hold a business plan full of explosive points and successfully get a huge amount of financing, but only focus on the wind outlet and ignore their own strength level, and even update the story regularly, and want to rely on the wind outlet to earn dividends to support the valuation.
In recent years, the new energy track is particularly obvious. Before "Wei Xiaoli", there were many companies trying to build cross-border cars, but most of them slowly fell silent after releasing business plans. The most famous is LeEco Jia Accounting, which will always "return home next week", which has been released five years since the release of the first concept car of the Faraday brand, when it promised delivery within a year, but has not yet achieved mass production of the FF91 electric car. For entrepreneurs, once the willingness to feel or dream goes beyond the rational analysis of reality, then it is not far from falling into the quagmire.
No matter how creative new concepts are, once profitable, competitors will soon flock to compete for the cake of the market. Therefore, even if you have a "commercialization concept" that is ahead of the times, you must clearly understand whether you have the ability to execute with it, know where your competitive advantages are, and what are my unique resources and capabilities. For example, the ability to integrate upstream and downstream suppliers in the industry; Much lower than the cost of funds for others, with deeply related government resources; These factors are key to building sustainable competition, such as a team of top experts in the industry.
If you don't have a clear advantage over other players, you need to learn to be patient and wait. When you find an opportunity that matches your own natural resources and have the corresponding execution ability, you can judge whether it is suitable for entrepreneurship and commercialization.
03
Strong execution: is the key to victory or defeat
Execution is the hardest part of bringing a new concept to life and generating business value, and it's the part that people don't want to talk about too much because it's boring, complex, doesn't deliver real benefits quickly, and sounds storyless. But often the least noticed is the most critical part of the decision.
This is very similar to the philosophy of war. People like to hear about ingenuity, such as "Thirty-Six Plans," because they are a shortcut to victory in war. But ingenuity only stays in the category of "art", especially with the popularity of the Internet, modern people recognize new concepts learning costs are lower, understand business tactics channels are more diverse, so what is you to win in the entrepreneurial battlefield?
What really determines the victory or loss of a war is not just ingenuity, but the training level, intelligence system, logistics reserve and transportation capacity of the peacetime army, which require a lot of manpower, material resources and time to build, which is the right "way" to continue to win the war.
Taking the modern football as a metaphor, although players can break through defensive goals through techniques such as feints, the audience often likes to cheer for such wonderful goals. But in fact, behind the breakthrough defense through feints is the hard training of the players day after day and the tacit cooperation between the teams, which is the preparation and hard work in "execution", which is also the least visible but most important part. The same are the top players selected from the crowd, and there is actually no decisive gap in the overall team in terms of talent, and what really widens the distance is the basic skills and strategic arrangements of the usual exercises.
The same is true in the business society, even if you have strong insight, only you stand on the vent alone, and only you think of creative flashpoints, it is generally unlikely to exist. What really determines the competitive advantage, in addition to natural resources, is fast and effective execution, who has stronger execution, the faster the pace of natural implementation, and the greater the possibility of successful landing.
Taking Meituan's success story as an example, many people only see huge subsidies for burning money, but few people see their daily hard work, such as the strong execution of core generals, excellent cost control of the ground push team, or the orderly management ability of the army, which is one of the key elements of Meituan's victory in the Thousand Regiments War.
Therefore, for enterprises or entrepreneurs, it is the basic condition to grasp the trend of the times, have insights that surpass others, understand their unique competitive advantages, and realistically build an efficient steel corps. When you can practice these basic skills, the real game begins.
04 Summary
ChatGPT, like all topics with disruptive attributes (such as the metaverse, NFT, and the Internet), became a phenomenal topic when the concept first appeared, and the situation looked very good. But history is always strikingly similar, as the Gartner curve summarizes the technological trends, and the expectation that the expansion period will be followed by a trough of bubble bursting.
In the case of the Internet, for example, the emergence of browsers and Web in the United States attracted public attention, and many people believed that this new concept would change the way business operated. The fact is that after investors entered the market with a large number of companies, they did not find a suitable business model, resulting in companies becoming heavily indebted and exiting one after another, which led to the Internet bubble of 1995-2001. After the bubble ended, the remaining companies in the market continued to look for industrial oases, and after that, it took several years to finally find the right business model.
The current development of ChatGPT may successfully lead the wave of disruptive change in the next generation of generative artificial intelligence, or it may repeat the previous bubble bursting of the Internet, which is anyone's guess. However, for the business community, the popularity of the concept does not represent the actual business value (except for the traffic value brought by the media), and eventually it must fall into the application scenarios with actual needs.
At present, the text reply generated by ChatGPT is smooth and humanized due to the blessing of RLHF technology, and the output of marketing copy is also more comprehensive due to the wide range of samples, but it still cannot be absolutely accurate, and errors will still occur in many exquisite decision-making scenarios, which mainly depends on the sample data learned by the AI model is still not enough, and the accuracy of some samples it learns also requires expert-level judgment and correction.
In addition, the supervision of the artificial intelligence industry is not perfect, and how to prevent criminals from using AI crimes is also a major social problem. To put it simply, generative AI products such as ChatGPT are still in the concept and prototype stage, and there is still a long way to go to achieve real commercialization.
In the foreseeable or unforeseeable wave of entrepreneurship in the future, the author believes that everything is inseparable from its roots - far beyond the insights of others, accurate assessment of their own resources and competitive advantages, and the strong execution of entrepreneurial teams, must be the necessary qualities for entrepreneurial projects to achieve commercial success, and also the only magic weapon for investors to make intelligent decisions and obtain rich returns.
Written by Kenneth Man
He is currently the Vice President of Finance and Chief Financial Officer (CFO) of Ecology Group. Worked for Deloitte Touche Tohmatsu and was selected for the Deloitte Global Executive Program; He also served as the financial director of Fortune 500 Yum China, and participated in the spin-off and listing in the United States in 2016. He has led expert teams to complete large-scale IPO and M&A projects, and led the successful implementation of the strategic transformation of the data ecosystem of many large enterprises.