{"id":6097,"date":"2023-11-02T15:24:36","date_gmt":"2023-11-02T15:24:36","guid":{"rendered":"https:\/\/connectwithfund.com\/markets\/bidens-executive-order-on-ai-could-help-25-billion-startup-anthropic\/"},"modified":"2023-11-02T15:24:37","modified_gmt":"2023-11-02T15:24:37","slug":"bidens-executive-order-on-ai-could-help-25-billion-startup-anthropic","status":"publish","type":"post","link":"https:\/\/connectwithfund.com\/?p=6097","title":{"rendered":"Biden\u2019s Executive Order On AI Could Help $25 Billion Startup, Anthropic"},"content":{"rendered":"<div>\n<p>Last month, the White House issued an executive order on AI \u2014 aiming to ensure the technology is \u201cSafe, Secure, and Trustworthy.\u201d<\/p>\n<p>My guess is this executive order will create winners and losers among the public companies and startups competing for their slice of the multi-trillion dollar Generative AI pie.<\/p>\n<p>The winners will be companies like Anthropic, the San Francisco-based provider of Claude 2 \u2014 a foundation model competing against OpenAI\u2019s ChatGPT \u2014 under the banner of making AI that is \u201chelpful, harmless and honest,\u201d according to <em data-ga-track=\"ExternalLink:https:\/\/www.nytimes.com\/2023\/07\/11\/technology\/anthropic-ai-claude-chatbot.html\">The New York Times<\/em><em><br \/>\n  <fbs-ticker data-name=\"NYT\" data-href=\"https:\/\/www.forbes.com\/companies\/new-york-times\" data-type=\"stock\"><br \/>\n   NYT<br \/>\n  <\/fbs-ticker>.<\/em><\/p>\n<p>Unlike companies that had been hoping to shift Generative AI\u2019s societal costs away from their investors, Anthropic\u2019s mission is consistent with the values in the executive order.<\/p>\n<p>Therefore, my guess is Anthropic will welcome the help from the executive order while rivals hoping to avoid government intrusion into their operations will view the order as an unwelcome anchor on their growth.<\/p>\n<p><fbs-ad position=\"inread\" progressive=\"\" ad-id=\"article-0-inread\" aria-hidden=\"true\" role=\"presentation\"><\/fbs-ad><\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\">Executive Order On AI<\/h2>\n<p>On October 30, President Biden signed an executive order on artificial intelligence in the East Room of the White House. The Biden Administration diverged from its hands off policy towards many other technologies and made \u201cthe federal government a major player in the development and deployment of AI systems that can mimic or perhaps someday surpass the creative abilities of human beings.\u201d according to the <em data-ga-track=\"ExternalLink:https:\/\/www.bostonglobe.com\/2023\/10\/30\/business\/biden-ai-executive-order\/?et_rid=706014301&amp;s_campaign=todaysheadlines:newsletter\">Boston Globe<\/em><em>, <\/em><\/p>\n<p>The EO does the following:<\/p>\n<ul>\n<li><strong>Initiates government safety monitoring. <\/strong>The EO<strong> <\/strong>asserts the government\u2019s right to oversee the development of future AI systems to limit their risk to national security and public safety, Developers of such systems must notify the government when they begin building them and share the results of any safety tests they conduct on the AI systems, the <em>Globe<\/em> noted.<\/li>\n<li><strong>Sets new safety standards.<\/strong> The EO tasks government agencies with setting new standards for AI, \u201caimed at protecting privacy, fending off fraud, and ensuring that AI systems don\u2019t reinforce human prejudices,\u201d the <em>Globe<\/em> reported. In addition, \u201cThe Department of Commerce will set standards for \u2018watermarking\u2019 AI-generated images, text, and other content to prevent its use in fraudulent documents or \u2018deep fake\u2019 images,\u201d the <em>Globe<\/em> reported.<\/li>\n<\/ul>\n<p>This EO raises many questions:<\/p>\n<ul>\n<li>What criteria will the government use to decide which future AI systems must comply with the standards?<\/li>\n<li>Which government agencies will enforce the standards and monitor compliance with them?<\/li>\n<li>Does the government have a sufficient number of trained people who can create the standards and assess whether AI companies are complying?<\/li>\n<li>What penalties, if any, will the government impose on companies that do not comply with the EO?<\/li>\n<\/ul>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\">Why The Executive Order Could Benefit Anthropic<\/h2>\n<p>Biden\u2019s EO will help companies already taking action to protect society from the risks of Generative AI. The reason is if the EO is carried out with sufficient resources, it will help such companies realize their mission.<\/p>\n<p>This comes to mind in considering Anthropic, the San Francisco-based provider of the foundation models used to build Generative AI chatbots. In 2021, Daniela Amodei and Dario Amodei, previously OpenAI executives, started Anthropic out of concern their employer cared more about commercialization than safety, according to <em>Cerebral Valley<\/em>.<\/p>\n<p>Anthropic is a roaring success. By October 2023, the 192-employee company had raised a total of $7.2 billion valuing the company at $25 billion \u2013 five times more than Anthropic\u2019s value in May.<\/p>\n<p>With clients including Slack, Notion and Quora, <em data-ga-track=\"ExternalLink:https:\/\/my.pitchbook.com\/profile\/466959-97\/company\/profile#insights\">Pitchbook<\/em> forecasts Anthropic\u2019s 2023 revenue will double to $200 million and <em data-ga-track=\"ExternalLink:https:\/\/www.theinformation.com\/articles\/openai-rival-anthropic-in-talks-to-raise-2-billion-from-google-others-as-ai-arms-race-accelerates\">The Information<\/em> reported the company expects to reach $500 million in revenue by the end of 2024.<\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\">Caring About Customers And Communities<\/h2>\n<p>The key to Anthropic\u2019s success is its co founders\u2019 concern for making Generative AI safe for its customers and communities. Anthropic\u2019s cofounders Dario Amodei, a Princeton-educated physicist who led the OpenAI teams that built GPT-2 and GPT-3, became Anthropic\u2019s CEO. His younger sister, Daniela Amodei, who oversaw OpenAI\u2019s policy and safety teams, became Anthropic\u2019s president. As Daniela said, \u201cWe were the safety and policy leadership of OpenAI, and we just saw this vision for how we could train large language models and large generative models with safety at the forefront,\u201d the<em> Times<\/em> wrote.<\/p>\n<p>Anthropic\u2019s co founders put their values into their product. The company\u2019s Claude 2 \u2013 a rival to ChatGPT \u2013 could summarize larger documents and produced safer results. Claude 2 could summarize up to about 75,000 words \u2013 the length of a typical book, Users inputted large data sets and requested summaries in the form of a memo, letter or story. ChatGPT could handle a much smaller input of about 3,000 words, the <em>Times<\/em> reported.<\/p>\n<p>Arthur AI, a machine learning monitoring platform, concluded Claude 2 had the most \u201cself-awareness\u201d \u2013 meaning it accurately assessed its knowledge limits and only answered questions for which it had training data to support, <em data-ga-track=\"ExternalLink:https:\/\/www.cnbc.com\/2023\/07\/11\/anthropic-an-openai-rival-opens-claude-2-ai-chatbot-to-the-public.html\">CNBC<\/em> wrote.<\/p>\n<p>Anthropic\u2019s concern about safety caused the company not to release the first version of Claude \u2014 which the company developed in 2022 \u2014 because employees were afraid people might misuse it. Anthropic delayed the release of Claude 2 because the company\u2019s red-teamers uncovered new ways it could become dangerous, according to the <em>Times<\/em>.<\/p>\n<h2 class=\"subhead-embed color-accent bg-base font-accent font-size text-align\">Using A Self-Correcting Constitution To Build Safer Generative AI<\/h2>\n<p>When the Amodeis started the company, they thought Anthropic would do safety research using other companies\u2019 AI models. They soon concluded innovative research was only possible if they built their own models. To do that, they needed to raise hundreds of millions of dollars to afford the expensive computing equipment required to build the models. They decided Claude should be helpful, harmless and honest, the <em>Times<\/em> wrote.<\/p>\n<p>To that end, Anthropic deployed Constitutional AI \u2013 the interaction between two AI models: one operating according to a written list of principles from sources such as the UN\u2019s Universal Declaration of Human Rights and a second AI to evaluate how well the first one followed its principles \u2014 correcting it when necessary, the <em>Times <\/em>noted.<\/p>\n<p>In July 2023, Amodei provided examples of Claude 2\u2032s improvements over the prior version. Claude 2 scored 76.5% on the Bar exam\u2019s multiple choice section, up from the earlier version\u2019s 73%. The newest model scored 71 percent on the Python coding test, up from the prior version\u2019s 56%. Amodai said Claude 2 \u201cwas twice as good at giving harmless responses,\u201d <em>CNBC<\/em> wrote.<\/p>\n<p>Because Anthropic\u2019s product is built to bring helpful, harmless and honest values to Generative AI, society could be better off \u2014 perhaps with help from Biden\u2019s EO.<\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.forbes.com\/sites\/petercohan\/2023\/11\/02\/bidens-executive-order-on-ai-could-help-25-billion-startup-anthropic\/\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Last month, the White House issued an executive order on AI \u2014 aiming to ensure the technology is \u201cSafe, Secure, and Trustworthy.\u201d My guess is this executive order will create winners and losers among the public companies and startups competing for their slice of the multi-trillion dollar Generative AI pie. The winners will be companies like Anthropic, the San Francisco-based provider of Claude 2 \u2014 a foundation model competing against OpenAI\u2019s ChatGPT \u2014 under the banner of making AI that is \u201chelpful, harmless and honest,\u201d according to The New York Times NYT . Unlike companies that had been hoping to<\/p>\n","protected":false},"author":1,"featured_media":6098,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[],"class_list":["post-6097","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-markets"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Biden\u2019s Executive Order On AI Could Help $25 Billion Startup, Anthropic | ConnectWithFund<\/title>\n<meta name=\"description\" content=\"Last month, the White House issued an executive order on AI \u2014 aiming to ensure the technology is \u201cSafe, Secure, and Trustworthy.\u201d My guess is this\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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