Posted by Why OpepenAI released Opensource models? Smartest business model we discovered accidentally.
OpenAI released Opensource models after spending billion. Do they have cash to burn? no…it’s a smart move that most of market doesn’t see…. is it smartest business model? may be…there are variations.
Is it really free? What Indian startups, businesses & investors should learn from not so obvious things in AI era?
Short answer – Give free is smartest Business model not philanthropy.
Nor its burning cash for nothing. It’s most advanced business model, few understand.
How we discovered world’s smartest model accidentally & how we are doubling down
We discovered it accidentally in our first round, when we didn’t even know word pitch deck. Read more – How strangers became angels when we didn’t even know about word “Pitch Deck”. We did MVP in 15-day, landed a $110k angel round, and connect with giants like Razorpay and L’Oréal, all while using free resources, minimal cost. The secret?
Give value first, expect later or better don’t expect at all. Trust the process & stay long enough. But how? What to do in AI era.
Throwing CXO lunches or money isn’t the solution – Free Value is
I attended CXO event where who’s who of C-suite were given stay at 7 star hotel, lunch, pick up & drop. Off stage C-suite told me – “It’s fine we come here, but that doesn’t cut ice”. Problem is same in US.
Burning cash is easy, generating value is difficult. Knowing what to generate is even harder
We experienced first hand building Vaayu – raising or burning more money isn’t the solution. There are bigger problems that money can‘t solve. So, In our fourth round that we just closed – we raised just enough.
Easier said than done – needs heart of iron & focus of an eagle on goal & some capital.
Many investors go to other extreme. They make it about “how much money you make?”. This is a trader mindset. Doesn‘t work in AI for now.
They think it’s sign of efficiency. Sorry – that’s not. Many startups have done AI Washing like builder.ai to show money making.
Value comes first, Builds trust, money comes later
- We in India haven’t yet caught to it despite using whtsapp/gmail/social media for free for decades. Our business models are yet simplest trading based. Buy at x – sell at y. Not long term. While economy has discovered complex ones. We are transactional. “Ek hath de, ek hath le”. Not best model.
Why we should care to offer value for free first
Startups are brutal. About monopolistic markets. Today FB, Google, Whtsapp are our economy bloodline. They have got to monopolistic levels….Cz they offered value first…monetize later.
We don’t have to be that big. But Free Value first is best to make mini monopolistic island.
While most of world asks for money first – We flip the game. Offer Value Free first, without expectations. Let it monetize later.
How to go lateral to offer value first – How are we doing it
- I suggested to banks CEO & automotive- Give advance roboadvisors free to customer. It’s not very expensive. 5-7rs per customers per month. But you get whole context of customers over years. It will become unbreakable moat for them in 10 yrs.
Offer freemium products. Make products not services. So costs of offering free starts reducing. See pic above. To tackle free PoC problem – Achal my, co-founder & brother has created self-serve model. We are perfecting it. So focus goes to tech & driving cost low than expecting market to change.- Offer free services – At our startup we did for Automotive, acquired data to train model, built infra which grew 75% month-on-month. We could go to 200% MoM. We wanted to gather 7 million data points & have infra. To have best model. But couldn’t…that’s okay…still offered value, we also won
- Earn Unique secrets the hard way, Share Secrets, Unique knowledge & let others win (if they wish) – That’s the value you generate. Costs almost nothing that you need to raise from VCs. But unique insights have the cost – you have to fail 100 times to create unique insights. It takes deep emotional toll. But you grow & learn 10x. We are ready to fail, learn secrets & let others win with our secrets. Just like I am doing by writing this blog.
- When u give for free, u offer value first- it build trust. Many times – u don’t get anything from other side.
With tech make it low cost, but give more & more to ppl - Keep it raw, authentic & original – Don’t try to polish too much. Keep it low cost, raw. If it were to polish – then it loses authenticity. it’s like trying to say what others want to listen & not sharing ground reality. There’s whole world doing it.
- It attracts top talent & micro eco system. That’s the ultimate race. There’s acute shortage.
- Build communities – amplify, multiply knowledge. Diwakar, nipun & myself run All Bharat AI Association – to offer value first.
Summary:
Create Value first, build trust & collabs. Keep the money at end. I can assure you things come back multiplied, if you stay long enough. This worked for always. Just focus on offering value, however little…offer what others offer paid.
To Make money, forget money first.
Build Value, Offer Value, Stay long enough, Money will follow
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