ChatGPT has taken the world by storm. OpenAI’s artificial intelligence chatbot has captured imaginations around the world and attracted heavy investment from Microsoft, which said this month it plans to pour billions into the company and integrate its technology into a wide range of its products.
But the rapid rise of OpenAI — it launched in late 2015 and ChatGPT shared with the public two months ago — will no doubt have some entrepreneurs wondering if they’re doing something wrong with their own lesser-known ventures.
Elad Gil, a widely respected Silicon Valley angel investor — he was an early bet on Airbnb, Instacart, and Square — believes “ChatGPT’s been consistently down at the moment is a great sign that the product is fit for the market . It’s because too many people are using it. That is a big problem.”
Gil made the comments on an episode of the Logan Bartlett Show podcast on Friday. The Google and Twitter alum noted the “problem” OpenAI faces after Bartlett, a software investor at VC firm Redpoint, asked for his opinion on product-market fit when considering investments .
One sign he looks for is positive testimonials from customers and users, he said: “It just shows the excitement that a small initial cohort has for the product.”
But he also added, “If a product breaks all the time but everyone keeps using it, then the product is clearly fit for the market,” noting that he witnessed this in the early days of Twitter and witnessed it now ChatGPT sees.
On the other hand, many ideas just don’t work out, no matter how much time an entrepreneur puts into them. He said the Silicon Valley lore that “you grind forever and eventually something will work” is wrong, noting that people have wasted years of their lives on such “bad advice”.
“People end up spending years and years and years of their lives grinding on something that isn’t going to work, because maybe if I do these three more tweaks, it will work, and maybe this month if I keep going, it will work,” he said, “For a very small number of cases this happens, but for the majority it works immediately or almost immediately.”
While it’s true that entrepreneurs may face tough times during a recession, he added, “In good times, the worst advice you can give anyone is to keep going, no matter what.”
“There’s a huge opportunity cost to your time, and most things don’t work out,” Gil said. “Most of the time you should actually find out when you give up and when you should actually stop. It’s really hard to know.”
When an idea works, it tends to work very quickly, which he’s seen repeatedly at companies he’s worked for and invested in over the years – and now sees at OpenAI and ChatGPT.
“The reality is that most of the companies, not all but the vast majority of the companies that I’ve been involved with that worked, ended up working fairly early on. And once they started working, they just kept working.”
He has also observed how others have made the same realization.
“One thing I’ve noticed is that people who’ve worked on things that didn’t have product market viability — that they thought would fit the product market — when they finally work on something that actually works, they do the immense Recognizing difference and the degree to which they were fooling themselves.”
In the first case, “You’re chasing after everyone and every sale is horrible and everything is a grind,” he said, but in the latter case, he says, “Hey, people keep calling me. And so it’s that transition, and until then you don’t realize how that really feels.”
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