A little-known American AI startup is looking to steal frontier AI companies\u2019 bread and butter by letting enterprise customers build their own custom AI models.<\/p>\n
OpenAI\u2019s and Anthropic\u2019s business models largely revolve around selling AI to business customers, via APIs and enterprise subscriptions. OpenAI CFO Sarah Friar reportedly told investors in an August closed-door meeting that while the startup\u2019s revenue had historically been approximately split 60\/40 in favor of individual customers, that ratio had recently reversed: \u201cThe majority of our revenue is now enterprise,\u201d Friar said, according to CNBC<\/a>. In February, Anthropic said<\/a> it had more than 500 business customers who spent more than $1 million annually on API usage or Claude subscriptions. A leaked IPO prospectus<\/a> revealed last month that one-quarter of Anthropic\u2019s revenue last year came from just two customers (both unnamed, but almost certainly businesses).<\/p>\n Several powerful open-source and open-weight models developed by Chinese AI labs have been a tempting alternative, since they can be modified to suit each customer\u2019s needs and, more importantly, are cheaper than American frontier models. ChatGPT and Claude, in contrast, come with a confusing jumble of pricing plans<\/a> that can be difficult to track. The era of so-called \u201ctoken-maxxing,\u201d when businesses encouraged employees to use AI tools as much as possible in their day-to-day work, has yielded to sober frugality<\/a>. But Chinese models bring problems of their own: most major U.S. companies are understandably hesitant to hand over sensitive customer information to an AI developer with direct ties to the Chinese Communist Party.<\/p>\n Reflection AI wants to fill that gap.<\/p>\n Launched in 2024 by a pair of former Google DeepMind researchers, the company is working to build what it calls an \u201cAI factory\u201d: software that lets businesses build their own AI models, negating the need to rely on subscriptions to closed systems like ChatGPT or risky Chinese alternatives. \u201cToday the best open models are coming out of China,\u201d the startup\u2019s cofounder and CEO Misha Laskin told CNBC<\/a> in July. \u201cAnd as a result, global AI adoption is actually very much being built on top of Chinese models, including [by] American companies. And that\u2019s great, but we wish to build a thriving AI ecosystem that has a lot of competition and a lot of players, and we\u2019re building the counterbalance to that\u2014building great open models here in America.\u201d<\/p>\n According to a new report<\/a> from Axios, Reflection is also now preparing to launch its own open-weight AI model to compete directly with the biggest frontier labs on both sides of the Pacific. While the report was scant on specifics, it said the model could be expected soon and that it will have capabilities on par with the most advanced Chinese open-weight models. Reflection\u2019s debut model will \u201cbe joined by other open-weight models from other Western players this month,\u201d Axios added in its report. Reflection didn\u2019t immediately respond to Gizmodo\u2019s request for comment about the new model.<\/p>\n Echoing Nvidia\u2019s Jensen Huang and Meta\u2019s Mark Zuckerberg, Reflection believes that a completely open ecosystem is the safest and most equitable pathway into the future: \u201cWe need to build open models so capable that they become the obvious choice for users and developers worldwide, ensuring the foundation of intelligence remains open and accessible rather than controlled by a few,\u201d the company wrote in a blog post<\/a> last year.\u00a0<\/p>\n Nvidia had invested about $800 million in Reflection as of March of this year, according to the Wall Street Journal<\/a>. Reflection also signed a multiyear partnership with SpaceX<\/a> in June, through which it agreed to pay Elon Musk\u2019s aerospace company $150 million per month for compute generated by the Colossus data center facility in Tennessee.\u00a0<\/p>\n Given how little is known at this point about Reflection\u2019s forthcoming model, it\u2019s too soon to say if it will be capable enough to convince businesses en masse to ditch ChatGPT or Claude. No matter how it pans out, the growing excitement around open models is likely to force both OpenAI and Anthropic to focus less on building new and more powerful AI systems and more on making their existing products more affordable and accessible\u2014especially as they both inch closer to their stock market debuts.<\/p>\n","protected":false},"excerpt":{"rendered":"A little-known American AI startup is looking to steal frontier AI companies\u2019 bread and butter by letting enterprise…\n","protected":false},"author":2,"featured_media":871996,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[182,184,28,11379,4321,1283],"class_list":["post-871995","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-ai","tag-anthropic","tag-business","tag-jensen-huang","tag-nvidia","tag-openai"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/871995","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=871995"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/871995\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/871996"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=871995"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=871995"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=871995"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}