At TCV’s Engage Summit in 2022, I gave a take on finding your next wave of growth, which you can read here. Sam Shank, founder and CEO of HotelTonight, asked me the question that everyone asks growth people, “What new channels are you seeing new consumer companies take advantage of?” My answer was disappointing as it always is, “What new consumer companies? Discord is the last one I have seen grow organically for a long period of time. Tiktok spent many billions of dollars buying up every ad they could on Facebook, Snap, and Google properties. It’s not really replicable.” I then proceeded to explain that consumer companies tend to arrive in droves during platform shifts, and we haven’t had one since mobile. But AI could be coming (editor’s note: it did). Sam quickly pointed out that while AI is a potential technological platform shift, it is not a distribution platform shift. And it’s distribution platform shifts that create new consumer opportunities. I’ve thought about this conversation a lot, and think I have a better framework to both describe what Sam was describing, and what that means now that the technological platform shift clearly arrived when ChatGPT came out.
In 5-10 years, there will be new distribution channels that will get unlocked due to AI, which didn't work as effectively during the internet and mobile era. For example, machine-to-human interactions or vice versa using voice, text (Chatbots), and mind (e.g. Neuralink). These new distribution channels will unlock an entirely new app ecosystem around them, similar to what OpenAI is trying with the GPT Store.
Your confidence is odd. I think your confusing accompanying interfaces with distribution channels. As a startup, how do I get traffic from chatbots (I don't right now)? How do I get traffic from voice interfaces (Alexa and Google Assistant didn't drive any)? Neuralink is still science fiction. How is OpenAI going to get normal people to browse the GPT Store over time? Apple failed at driving meaningful discovery of new apps via their App Store after only a couple years. Brand search is what most of the queries on the App Store are today.
Hi Casey, yes, I am overly optimistic about the new channels and believe they will disrupt current channels (search) and unlock new distribution. Here is my wishful imagination. GenAI will unlock new ways of interacting with the machine (or the internet). For payments in Asian countries (55% of the global population), we moved from typing something on a mobile device to scanning a QR code to pay. QR payment has become the go-to way for most customers to pay or accept payments in Asia. Similarly, we will see an innovation for voice interaction with machines (on a mobile phone or equivalent h/w) where customers will use natural language and voice to interact with machines. Voice AI technology will become democratized and part of telecom/network providers offering (so existing distribution unlike Alexa, Cortana, Siri or Google Assistant). The chatbot form will manifest through disruptive interfaces like ChatGPT / Perplexity, which will eat Google's market share. I predict that even Google will evolve into a chat-like interface, and its market search in search will decrease drastically in the next 10 years. Mind interchange with a machine using Neuralink-like technology is a long shot.
Do you think there's a way to in-organically force a platform shift with AI a la TikTok buying all the ads? (BTW- love the content and your analysis! I'm rooting for new distribution angles too!)
For sure. Only for extremely well capitalized companies though. FB/Google/Amazon/Apple have been able to force weak product/market fit ideas on people by spending a lot of money on it. And Bytedance and Pinduoduo have spent billions trying to unlock the American market with Tiktok and Temu.
In 5-10 years, there will be new distribution channels that will get unlocked due to AI, which didn't work as effectively during the internet and mobile era. For example, machine-to-human interactions or vice versa using voice, text (Chatbots), and mind (e.g. Neuralink). These new distribution channels will unlock an entirely new app ecosystem around them, similar to what OpenAI is trying with the GPT Store.
Your confidence is odd. I think your confusing accompanying interfaces with distribution channels. As a startup, how do I get traffic from chatbots (I don't right now)? How do I get traffic from voice interfaces (Alexa and Google Assistant didn't drive any)? Neuralink is still science fiction. How is OpenAI going to get normal people to browse the GPT Store over time? Apple failed at driving meaningful discovery of new apps via their App Store after only a couple years. Brand search is what most of the queries on the App Store are today.
Hi Casey, yes, I am overly optimistic about the new channels and believe they will disrupt current channels (search) and unlock new distribution. Here is my wishful imagination. GenAI will unlock new ways of interacting with the machine (or the internet). For payments in Asian countries (55% of the global population), we moved from typing something on a mobile device to scanning a QR code to pay. QR payment has become the go-to way for most customers to pay or accept payments in Asia. Similarly, we will see an innovation for voice interaction with machines (on a mobile phone or equivalent h/w) where customers will use natural language and voice to interact with machines. Voice AI technology will become democratized and part of telecom/network providers offering (so existing distribution unlike Alexa, Cortana, Siri or Google Assistant). The chatbot form will manifest through disruptive interfaces like ChatGPT / Perplexity, which will eat Google's market share. I predict that even Google will evolve into a chat-like interface, and its market search in search will decrease drastically in the next 10 years. Mind interchange with a machine using Neuralink-like technology is a long shot.
I don't see how any of that gets startups more users though.
Do you think there's a way to in-organically force a platform shift with AI a la TikTok buying all the ads? (BTW- love the content and your analysis! I'm rooting for new distribution angles too!)
For sure. Only for extremely well capitalized companies though. FB/Google/Amazon/Apple have been able to force weak product/market fit ideas on people by spending a lot of money on it. And Bytedance and Pinduoduo have spent billions trying to unlock the American market with Tiktok and Temu.