• Home
  • Technology
  • Gaming
  • Entertainment
  • World & Business
  • Science
  • Sports
  • AI
HomeTechnologyGamingEntertainmentWorld & BusinessScienceSportsAI
    • HomeTechnologyGamingEntertainmentWorld & BusinessScienceSportsAI
    • Home
    • Technology
    • Gaming
    • Entertainment
    • World & Business
    • Science
    • Sports
    • AI
    AI

    Naveen Rao Says AI Is Not SaaS

    Unconventional AI CEO contrasts hardware costs and supply with SaaS metrics.

    RI
    NR
    EB
    4 Sources, 28d ago, first seen 28d ago

    TLDR

    Naveen Rao, CEO and co-founder of Unconventional AI and earlier founder of Nervana Systems, posted that AI market dynamics, concentration, value proposition, and supply differ from SaaS because supply is tied to hardware and carries real costs. He told readers to stop applying SaaS metrics such as CAC. In the same cluster a post retweeted by Rishi Bommasani cited Ramp data indicating AI company revenues depend on a small set of customers.

    Combined views

    509.2K

    4 Sources, first seen 28d ago

    Combined views

    509.2K

    4 Sources, first seen 28d ago

    1.4K likes
    Today's Rank

    —

    Not ranked yet

    Today's Rank

    —

    Not ranked yet

    1.4K likes
    161 comments
    759 saves
    260 reposts
    161 comments
    759 saves
    260 reposts

    Sentiment

    Positive24.6%75.4%Negative

    Summary

    Sentiment

    Positive24.6%75.4%Negative

    Negative replies disputed claims that AI differs from SaaS and that revenue concentration offers growth upside, arguing instead that dependence on a few customers makes the trade fragile and the data unreliable.

    Based on 71 sentiment-bearing replies from 61 accounts across 2 conversations.

    Summary

    Negative replies disputed claims that AI differs from SaaS and that revenue concentration offers growth upside, arguing instead that dependence on a few customers makes the trade fragile and the data unreliable.

    Based on 71 sentiment-bearing replies from 61 accounts across 2 conversations.

    4 Sources

    @arakharazianNew from Ramp data: the latest threat to the AI trade. AI companies' revenues are heavily dependent on a small set of customers. 80% of OpenAI and Anthropic's enterprise revenues come from 1% of their customers, and it's not getting better. This is a level of concentration risk unseen in any other software category we track. The companies in the top 1% skew heavily toward the tech sector and AI products and services. What happens in a market correction? All these companies are highly correlated, and an increasing share of our economy is invested in them. Especially as we approach blockbuster IPOs for OpenAI and Anthropic.
    @RishiBommasaniRT @arakharazian: New from Ramp data: the latest threat to the AI trade. AI companies' revenues are heavily dependent on a small set of cus…
    @NaveenGRaoSay it with me: this. is. not. SaaS. All these concentration metrics, CAC, blah blah are just remnants of SaaS dynamics. AI != SaaS. The market dynamics are different, and the concentration is different, the value prop is different, the supply is different (very tied to hardware and has real costs). Stop calling it a risk...it's just the way AI works. Is Nvidia at risk since most of their revenue comes from 10 customers?
    @bernhardssonNot a particularly bad stat imo because there’s such a long tail of randos. More interesting is what % of revenue comes from the top 1, 2, 5, 10, 20, 50, …

    4 Sources

    @arakharazianNew from Ramp data: the latest threat to the AI trade. AI companies' revenues are heavily dependent on a small set of customers. 80% of OpenAI and Anthropic's enterprise revenues come from 1% of their customers, and it's not getting better. This is a level of concentration risk unseen in any other software category we track. The companies in the top 1% skew heavily toward the tech sector and AI products and services. What happens in a market correction? All these companies are highly correlated, and an increasing share of our economy is invested in them. Especially as we approach blockbuster IPOs for OpenAI and Anthropic.
    @RishiBommasaniRT @arakharazian: New from Ramp data: the latest threat to the AI trade. AI companies' revenues are heavily dependent on a small set of cus…
    @NaveenGRaoSay it with me: this. is. not. SaaS. All these concentration metrics, CAC, blah blah are just remnants of SaaS dynamics. AI != SaaS. The market dynamics are different, and the concentration is different, the value prop is different, the supply is different (very tied to hardware and has real costs). Stop calling it a risk...it's just the way AI works. Is Nvidia at risk since most of their revenue comes from 10 customers?
    @bernhardssonNot a particularly bad stat imo because there’s such a long tail of randos. More interesting is what % of revenue comes from the top 1, 2, 5, 10, 20, 50, …