Episode #62: Three Breakthroughs: Warfare Goes High-Tech

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  Sam:
  AI and warfare, 100 open source AI models, and Meta Goggles—let’s get into it.

  Mike Collins:
  The United States has a huge military industrial complex, but the next war is not going to be about who has the best battleships and nuclear submarines.

  Naren Ramaswamy:
  The positive is the accessibility for these models. Everyone will have access to the transformative power of AI.

  Mike Collins:
  But I think it’s like human beings. We have senses, and I think they’re all going to be part of this future—voice, sight, sound.

  Sam:
  All right, everyone, it’s been a second. Welcome back to this episode of The Tech Optimist. We have a Three Breakthroughs episode for you today.

  Now, we’ve got a new guest on Mike’s other side for these next few episodes, so I’m going to introduce them now. You know him, you love him—Mike Collins, founder and CEO of Alumni Ventures, on one side of the table.

  And then, not a stranger to the podcast if you’re an OG from day one—Naren Ramaswamy, a principal here at Alumni Ventures, is also on the other side of Mike.

  And then you know me—my name is Sam. I’m the guide, editor, and narrative savant for this show. I’m going to take you through the show.

  So, a few snippets from the breakthroughs today: I like to leave the breakthroughs kind of like a guessing game for all of you listening, so I’m going to try my best not to spoil them this time.

  But first, we talk about the changing landscape of warfare and conflict in nations around the world. We also talk about how a company released 100 open source AI models, meaning anyone can get one of these models and train it themselves to do what they want—which is awesome. We get into specifics a little bit later.

  And then the third breakthrough is Meta and Mark Zuckerberg’s latest invention or breakthrough, I guess you could say. This innovation is crazy—it puts everything that we thought we knew about reality, virtual reality, and augmented reality on its head.

  So sit back, relax, enjoy this episode of Three Breakthroughs here at The Tech Optimist. We’re so happy you’re here and we can’t wait to share the rest of the show with you. Let’s do it.

  Audio:
  As a reminder, The Tech Optimist Podcast is for informational purposes only. It is not personalized advice, and it is not an offer to buy or sell securities. For additional important details, please see the text description accompanying this episode.

  Mike Collins:
  Hello and welcome to this episode of The Tech Optimist Podcast. Calling in remote today, but I’m here with Naren Ramaswamy. This Three Breakthroughs episode—we created it because our customers want to know what we’re thinking about, seeing, and excited about in the way of technology and breakthroughs. We get together every week and chat about it briefly.

  Naren, welcome to duty. You’ve got a month or two in this slot. Congratulations.

  Naren Ramaswamy:
  Thank you. It’s nice to be back in the seat.

  Mike Collins:
  Great. All right, so I think I’m going first this week. I was really struck by the changing face of war. Unfortunately, there’s conflict in the world. Statistically, it’s been a peaceful time over the course of hundreds of years, but boy, it sure doesn’t feel like that when you’re following what’s going on in Ukraine, the Middle East, and elsewhere.

  What really struck me is the technology basis of warfare today. We’re seeing cybersecurity advances—the Israeli forces blowing up pagers and taking out communications. In Ukraine, with the Russian war, we’re seeing the use of drones. It strikes me that there’s disruption going on in the defense industry, and there’s always the risk of fighting the last war.

  It seems that for countries to maintain their military positioning and strategic strength, there are new vectors they must master: intelligence, cybersecurity, cyber hacking, drones—the list goes on and on.

  We have a Strategic Tech Fund because we believe Western democracies need to excel at these technologies. That has really struck home with me this week. Any thoughts on that, Naren?

  Naren Ramaswamy:
  Absolutely. It’s always tragic to hear about civilians being harmed in war. But the points you highlighted—there are two big opportunities in venture as a result of today’s situation.

  One is around cybersecurity, which is now a $250 billion industry largely focused on enterprise cybersecurity. But now, if you add departments of defense around the world as an addressable market, it’s going to explode in terms of market size.

  The second piece is around robotic swarms waging war for you, and we’re starting to see companies actively pursuing that opportunity. The U.S. Department of Defense has historically been averse to the private sector selling into them, but that’s changing now.

  Frankly, they’re realizing that for the strategic importance of the country, you have to find the best technology and be armed with it. This presents an opportunity for the venture sector. Even within Silicon Valley, selling to the DoD or the government in general has become more attractive now because of this more friendly environment.

  So, I think it’s an exciting time for the Strategic Tech Fund as well as any startups adjacent to selling into government or defense broadly.

  Mike Collins:
  Yeah, there’s lots to unpack there. This was an area that, historically, was different. There’s been a sea change on both sides of the equation.

  The United States has a huge military industrial complex, but the next war is not going to be about who has the best battleships and nuclear submarines. The ability of entrepreneurs and the U.S. tech industry to provide solutions—both sides are more open to working partnerships now than at any time in my lifetime.

  I think it’s smart. It’s out of necessity. It’s obvious that this is where things are going. You also raise a good point: many businesses may not have defense as their sole mission, but this is a market where they can take their core product or service and sell it now. That’s an opportunity as well as, like you point out, the adjacencies.

  Sam:
  Okay, this is a perfect opportunity for me to share one of my favorite content creators I’ve found to date. I’m going to share a video by video journalist and filmmaker Johnny Harris. About eight months ago, he released a video titled Why Hacking is the Future of War.

  The video is incredible and so well written. Obviously, I’m not going to play the whole video because it’s 30 minutes long, but here are a few snippets from it that align with what Mike and Naren are talking about—the changing face of war and how important, dangerous, and vital cybersecurity and cyber hacking can be.

  I hope you enjoy it. We’ll do a quick ad first. Enjoy Johnny Harris’ video snippet, and then we’ll get back to the interview. Don’t go anywhere—we’ll be right back.

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  Johnny Harris:
  It’s November 10th, 2008. Barack Obama has just won the election, and he travels to the White House to meet with outgoing President George Bush. In that meeting, Bush told Obama about a top-secret weapon that the U.S. military had been developing with Israel since 2005, code-named Project Olympic Games.

  This weapon was intended to hit one of Iran’s most fortified nuclear facilities, buried deep underground, where centrifuges spin uranium to enrich it for energy—or, with enough spinning, for use in a nuclear weapon.

  But this secret weapon wasn’t a missile. They weren’t planning an airstrike. Instead, it was a computer file less than a megabyte in size—150,000 lines of pristine code. This is the weapon the president had to tell Obama about.

  This little file had been planted in Iran, where it spread throughout the country but didn’t do anything. It lay dormant until it found its way onto a flash drive plugged into the underground nuclear facility.

  Then it spread, finding its final target—one specific machine. The weapon started working, quietly reprogramming software to subtly sabotage the delicate spinning centrifuges: opening valves to change pressure, telling centrifuges to spin faster or slower—all while telling technicians that everything was working properly.

  Over time, these manipulations destroyed the centrifuges. This was one of several weapons that the U.S. had planted in Iran using sophisticated code.

  Now, if a war broke out with Iran, the U.S. could turn off their power, disable military defense systems, make it impossible to shoot down planes, and shut down command and control systems so they couldn’t communicate during a fight.

  This was a real war plan executed by thousands of American military personnel and costing hundreds of millions of dollars—a cyber operation that would “prepare the battlefield” by weakening Iran’s ability to fight.

  All of it using code. The code that sabotaged the nuclear facility was eventually discovered and named based on some elements inside the many lines of code, like .stub or Mrxnet. They called it Stuxnet.

  This weapon slowed Iran’s progress but didn’t stop it. However, it showcased a new style of war: quiet weapons in the form of tiny text files that could self-replicate and cause real, physical damage to an enemy.

  We call this cyber warfare, and it has become a fixture of modern conflict. Let me show you how it works.

  Video Audio:
  We’re moving into a new era. People will actually get killed. Dismantle our communication system. With the click of a button, you can bring nations to their knees.

  Sam:
  Okay, that’s all the snippet you get. If you want to watch the rest of that video and explore Johnny’s incredible portfolio, hop over to his YouTube channel and check out his work. That’s enough snippets for this episode. Let’s get back to the show.

  Mike Collins:
  Yeah, I mean, that’s what’s on people’s minds this week. What else do you have? What’s yours?

  Naren Ramaswamy:
  I think that first topic is a good segue into what I wanted to touch on. There was a news article about Alibaba—the Chinese cloud giant—releasing 100 open AI models. Not one or two. These are 100 models, each specific to a different use case or industry.

  What’s the implication of this on the global AI stage? I think there are two or three implications.

  First, companies like OpenAI no longer have competition just in North America. There’s going to be competition from Japan, China in this case, and countries in Europe—everyone trying to build their own open source models.

  The positive is accessibility. Everyone will have access to the transformative power of AI. As long as you have a smartphone or a computer anywhere in the world, you’ll not only have access to information through the internet, but also be able to derive insights from that information.

  It’s a great equalizer between rich and poor.

  Lastly, touching on national interests: you can imagine each of these countries pumping hundreds of millions of dollars into their own AI models so they’re not left behind in the global race.

  ChatGPT-4 reportedly cost over $100 million to build. That’s a massive sum compared to seed rounds in venture, which are $2 million or $4 million. This will also change the venture landscape a bit.

  Overall, it’s exciting because of accessibility and the equalizing nature of technology.

  Mike Collins:
  Meta also built and released some new open models. This is classic—open models everywhere. I think it also has implications for regulation because this is now a worldwide open source environment.

  That’s great for accessibility and innovation, but it also makes regulation nearly impossible. The LLM genie is out.

  Now we need to focus on other parts of the value chain: the chips to run these models, the power to support them. We talked last week about how energy might be the bottleneck for AI deployment. Innovators are working to reduce power consumption, and some of these mini models do much better on that front.

  But this is a global phenomenon. Everyone sees it, everyone has their own take on it, and everyone is going to have access to it.

  Sam:
  I’m going to take a few seconds to interject here. CNBC released a really cool article about this phenomenon that Alibaba may have started or launched here, and I’m going to read a section of it.

  AI models are trained on huge amounts of data. Alibaba says its models have the ability to understand prompts and generate text and images. Open source means that anyone—including researchers, academics, and companies around the world—can use the models to create their own generative AI apps without needing to train their own systems, saving time and expense.

  By open sourcing the models, Alibaba hopes more users will use its AI. The Chinese e-commerce giant first launched its Tongyi Qianwen or Qianwen model last year. Since then, it has released improved versions and says that to date, its open source models have been downloaded 40 million times. The company also said it upgraded its proprietary flagship model called Qwen-Max, which is not open source. Instead, Alibaba sells its capabilities through its cloud computing products to businesses. Pretty cool.

  Mike Collins:
  I know it’s not everybody, but even the new Apple AI—which I think is more signaling than delivering profound benefits—clearly means anyone with an iPhone is going to have AI access and the features they’re launching. I’ve been playing with them for a couple of weeks. They’re relatively modest, but they work and they add value.

  Apple’s going to be a player in this space. They have the phone—there’s a billion of them in people’s pockets all day long. So they’re going to be a player as well.

  I think open source also keeps everybody on their toes. We’ve talked about the state of change and improvement. I’ve spent more time in the last three weeks working with the reasoning models from ChatGPT, and they are a difference maker. The multi-step process these beta reasoning models are showing is another game changer.

  So, people say, “Oh, ChatGPT,” then “ChatGPT-4o,” now “o1,” “Strawberry,” and these reasoning models—it’s coming hot and fast.

  Naren Ramaswamy:
  Just one thing to touch on—it’s fascinating how far open source has come. Two or three decades ago, people were saying, “There’s no way you can sell something you’ve made and offer it for free. How are you going to make money?”

  Now, it’s become table stakes for infrastructure software, especially where you build something and let somebody else leverage it to build something else. It’s a virtuous cycle in the tech industry that will continue accelerating innovation. The business model has been proven out. I think it’s a win-win all around.

  Mike Collins:
  Yeah, no, it’s very exciting. The third one—it was tricky to pick this week, but I’m going back to Meta, which had an event about their goggles.

  Apple’s Vision Pro—when Apple makes a move, everyone pays attention. There hasn’t been much talk since they announced it. I think there are hardcore users exploring it, but it’s not mainstream yet.

  Meta came in with a much smaller form factor: a combination of smaller, hockey puck-sized glasses and a wrist device. Very impressive. Again, too expensive—they say the prototype is about $10,000.

  But what does that say? To me, it says vision is going to be part of the future. It’s not mainstream yet, but it’s coming. This new framework—we don’t know exactly how it’ll play out.

  AI is coming. Will it be driven by voice? The new ChatGPT voice stuff is impressive. I know a lot of our team uses it while driving or commuting to interact with things. But like human beings—we have senses. I think they’re all going to be part of this future: voice, sight, sound.

  I don’t know exactly how it’ll play out; it may be all of the above. But with phones, watches, glasses, voice—all these tools—I think augmented reality and virtual reality will, in our lifetimes, become regular.

  I’m traveling with friends right now, and there are moments when everyone’s looking at their phones. In the next five years, I think that will change. People will wear glasses like I’m wearing now, and you’ll look something up, someone will make dinner reservations, and you’ll interact as humans while still doing those things.

  It’s an important perspective. We should stay open-minded because the story isn’t written yet.

  Since the iPhone and smartphone revolution, computing has been driven to mobile. There’s still a role for desktops, watches, rings—like our portfolio company Oura Ring. These different inputs and devices are all evolving.

  AI is going to shake things up—it could be all of the above. I don’t know. What do you think, Naren?

  Sam:
  All right, before we give Naren the mic and let him share his thoughts on these glasses and this breakthrough, I want to provide a bit more information about this crazy innovation Meta has brought to the table.

  Here are some details about the prototype:

  Mike was very clear this isn’t finished, and Meta also made it clear this is an internal research device.

  Orion is designed to look and feel like regular glasses, weighing just 98 grams. It offers a 70-degree diagonal field of view, which is notably wide for AR glasses. The current prototype has a resolution of 13 pixels per degree, with a goal of reaching 30 in the final product. Orion uses micro LED projectors outputting hundreds of thousands of nits of brightness, resulting in 300 to 400 nits reaching the user’s eyes.

  The glasses use innovative silicon carbide lenses, which allow for the wide FOV and improved optical clarity.

  Orion is a three-part system: the glasses, a wireless computing puck, and a neural wristband for control. The pocket-sized puck provides wireless AI and AR capabilities within a range of about 12 feet.

  The wristband reads electrical signals from wrist movements for subtle, socially acceptable input. Users can control Orion through a combination of eye tracking, hand tracking, voice commands, and the neural wristband.

  Some capabilities and features include:

  • AI integration

  • Multitasking: view recipes, make calls, browse social media simultaneously

  • Holographic interactions: 3D holographic experiences like gaming (similar to Meta Quest headset)

  As for development and future plans: Orion is a functional prototype. Meta plans to produce about 1,000 units for testing at an estimated $10,000 per unit.

  Future plans aim for fully realized AR glasses that could potentially replace smartphones. Think about that—that concept is wild and pretty insane.

  We’re going to wrap up this episode with one more quick ad, and then we’ll finish up. Enjoy.

   

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  Naren Ramaswamy:
  I definitely agree with you. I think all these consumer devices are going to be a medium for these super smart algorithms to just be pervasive around you.

  There’s a lot of pessimism about, “Oh, AI is going to do everything for you, so what will you do?” But the flip side—the optimistic side—is: wouldn’t you want a pervasive AI to help you? It’s a helper that’s always around you. You don’t have to stare into your phone to access it anymore.

  You’re going about your day. Maybe you’re on the side of the road fixing a tire and forget the next step. You just talk to your glasses, and it says, “Hey, see that scanner over there? Use that.”

  For the smallest of use cases—like when you’re grocery shopping—it could say, “Hey, this product is $3 cheaper on Amazon. Don’t buy it here.”

  And for larger use cases—like doctors performing surgery—you’ll have this smart, intelligent being helping you. Across the board, it’s going to be a significant chapter in human history, for sure.

  Mike Collins:
  Yeah, I just want to share one example from one of our teammates. He shared this on our AI Life Lessons channel where we talk about how we’re using these new technologies in big and small ways.

  He was sent to the grocery store by his spouse to buy yogurt for the kids. As we all know, there are thousands of brands, and they needed a very specific one.

  What he did was take a photograph of the entire aisle because he couldn’t find it and asked, “Where is XYZ brand?” The AI came back and said, “Top row, third from the end.”

  That was just with a phone. Imagine when we’re wearing glasses—you might not even have to say anything. Through the glasses, it could just point an arrow and say, “Buy this one.”

  These are fun and exciting developments. They’re going to become part of the fabric of our lives. We’re just starting to see these pixels forming, but the picture isn’t complete yet. It’s fun seeing new things come online.

  Don’t give up on the vision side of it. I’m traveling and brought my Vision Pro. At the office, as you know, Naren, I’ve got six monitors set up to handle everything going on with AI and more. I’m not hauling six monitors to Colorado, but with my goggles, I effectively have that setup. I can position screens where I want them and stay super productive.

  Naren Ramaswamy:
  Yeah, definitely a game changer.

  Mike Collins:
  It was really exciting. Well, welcome to this segment. I look forward to unpacking lots of cool things with you over the next couple of months, Naren, and we’ll talk again next week.

  Naren Ramaswamy:
  Likewise. Thanks, Mike. Appreciate the opportunity.

  Mike Collins:
  All right, see you soon. Bye.

  Naren Ramaswamy:
  See you.

  Audio:
  Thanks again for tuning into The Tech Optimist. If you enjoyed this episode, we’d really appreciate it if you’d give us a rating on whichever podcast app you’re using, and remember to subscribe to keep up with each episode.

  The Tech Optimist welcomes any questions, comments, or segment suggestions. Please email us at [email protected] with any of those, and be sure to visit our website at av.vc. As always, keep building.