Why AI Could Be Entering a Golden Age | Knowledge@Wharton - Technology

The quest to give machines human-level intelligence has been around for decades, and it has captured imaginations for far longer — think of Mary Shelley’s Frankenstein in the 19^th century. Artificial intelligence, or AI, was born in the 1950s, with boom cycles leading to busts as scientists failed time and again to make machines act and think like the human brain. But this time could be different because of a major breakthrough — deep learning, where data structures are set up like the brain’s neural network to let computers learn on their own. Together with advances in computing power and scale, AI is making big strides today like never before.

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Photo: Frank Chen

After years of dashed hopes, we could be on the brink of large breakthroughs in artificial intelligence for businesses thanks to deep learning, says Frank Chen of Andreessen Horowitz. 

Photo: Knowledge@Wharton

Frank Chen, a partner specializing in AI at top venture capital firm Andreessen Horowitz, makes a case that AI could be entering a golden age. Knowledge@Wharton caught up with him at the recent AI Frontiers conference in Silicon Valley to talk about the state of AI, what’s realistic and what’s hype about the technology, and whether we will ever get to what some consider the Holy Grail of AI — when machines will achieve human-level intelligence.

An edited transcript of the conversation follows.

Knowledge@Wharton: What is the state of AI investment today? Where do we stand?
Frank Chen: I’d argue that this is a golden age of AI investing. To put it in historical context, AI was invented in the mid-1950s at Dartmouth, and ever since then we’ve basically had boom and bust cycles. The busts have been so dramatic in the AI space that they have a special name — AI winter.
We’ve probably had five AI winters since the 1950s, and this feels like a spring. A lot of things are working and so there are plenty of opportunities for start-ups to pick an AI technique, apply it to a business problem, and solve big problems. We and many other investors are super-active in trying to find those companies who are solving business problems using AI.

Knowledge@Wharton: What brought us out of this AI winter?

Chen: There’s a set of techniques called deep learning that when married with big amounts of data really gets very accurate predictions. For example, being able to recognize what is in a photo, being able to listen to your voice and figure out what you’re saying, being able to figure out which customers are going to churn. The accuracy of these predictions, because of these techniques, has gotten better than it has ever gotten. And that’s really what’s creating the opportunity.

Knowledge@Wharton: What are some of the big problems that AI is solving for business?

Chen: AI is working everywhere. To take one framework, think about the product lifecycle: You have to figure out what products or services to create, figure out how to price it, decide how to market and sell and distribute it so it can get to customers. After they’ve bought it, you have to figure out how to support them and sell them related products and services. If you think about this entire product lifecycle, AI is helping with every single one of those [stages].

For example, when it comes to creating products or services, we have this fantasy of people in a garage in Silicon Valley, inventing something from nothing. Of course, that will always happen. But we’ve also got companies that are mining Amazon and eBay data streams to figure out, what are people are buying? What’s an emerging category? If you think about Amazon’s private label businesses like Amazon Basics, product decisions are all data-driven. They can look to see what’s hot on the platform and make decisions like “oh, we have to make an HDMI cable, or we have to make a backpack.” That’s all data-driven in a way that it wasn’t 10 years ago.
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Source: Knowledge@Wharton