Why is model inference getting cheaper? How did I drop a soon-to-be $2,000+/month bill for AI agents to next to nothing? And why are local models on commodity hardware potentially “good enough” for most people?

There are two macro trends here that feed directly into each other.

… costs are dropping for the same capacity (same model, same query), and we’re constantly ramping up what we use (bigger model, more expensive query). — Read More

#strategy

At Stanford HAI, we believe AI is poised to be the most transformative technology of the 21st century. But its benefits won’t be evenly distributed unless we guide its development thoughtfully. The AI Index offers one of the most comprehensive, data-driven views of artificial intelligence. Recognized as a trusted resource by global media, governments, and leading companies, the AI Index equips policymakers, business leaders, and the public with rigorous, objective insights into AI’s technical progress, economic influence, and societal impact. — Read More

#strategy

I haven’t been writing a lot for reasons I’ll share below. So when I was invited by Stripe to speak on the SaaSpocalypse as part of their SaaS Platform Leaders Summit, it turns out I had a lot to say. Simple questions were met with word gush as thoughts that had been built up inside my head over the last weeks and months tumbled out.

Writing is synthesis for me, so here’s my attempt to crystallize my view of the SaaSpocalypse. 

The crowd was mainly vertical SaaS CEOs so this essay is written as such. But, the LLMs are moving up the stack, so much of this is applicable to Native AI startups as well.  — Read More

Some companies are rebuilding themselves around AI. Everyone else is waiting for a lab, vendor, owner, or competitor to do it for them.

Token Economy Part 1 said tokens don’t create productivity. The operating model does.

This week shows what happens next: if you can’t build that operating model yourself, someone will install it for you. — Read More

Andrej Karpathy, the AI researcher who co-founded and formerly worked at OpenAI and previously led AI at Tesla, has joined Anthropic.

“I’ve joined Anthropic,” Karpathy posted on X Tuesday. “I think the next few years at the frontier of LLMs will be especially formative. I am very excited to join the team here and get back to R&D.” — Read More

Large language models (LLMs) are often praised for exhibiting near-human performance on a wide range of tasks and valued for their ability to hold a general conversation. The rise of agentic AI systems is, however, ushering in a mass of applications in which language models perform a small number of specialized tasks repetitively and with little variation.
Here we lay out the position that small language models (SLMs) are sufficiently powerful, inherently more suitable, and necessarily more economical for many invocations in agentic systems, and are therefore the future of agentic AI. Our argumentation is grounded in the current level of capabilities exhibited by SLMs, the common architectures of agentic systems, and the economy of LM deployment. We further argue that in situations where general-purpose conversational abilities are essential, heterogeneous agentic systems (i.e., agents invoking multiple different models) are the natural choice. We discuss the potential barriers for the adoption of SLMs in agentic systems and outline a general LLM-to-SLM agent conversion algorithm. — Read More

#strategy

Nearly halfway into 2026, enterprises are beginning to see tangible returns on their AI investments. Yet many are discovering that scaling requires something far less glamorous than flashy frontier models and state-of-the-art benchmarking: Clean, interoperable, governed data.

According to a new AI Momentum Survey from Dun & Bradstreet, 97% of organizations report active AI initiatives, but just 5% say their data is ready to support them. — Read More

Last month Salesforce announced it would open its APIs and launch a headless product, essentially betting that in an agentic world, its value lies in the data layer, not the UI. It’s a smart repositioning. (Although it’s worth noting that not much appears to have changed technically: the APIs Salesforce is now marketing as a “headless product” have largely existed for years. In other words it was a classic Salesforce marketing launch.) The idea behind the new product is that agents can access the data from the system of record without needing to interact with the UI, which is designed for humans to track workflows.

The announcement is a useful prompt for a more interesting question: if you strip away the UI and expose the database, what are you actually left with? How is that different from a Postgres database, a well-designed schema, and an API? Do the classic factors that make systems of record durable persist, or is there a new set of criteria? In the SaaS era, the system of record was defensible because humans lived in the interface. In the agentic era, that advantage weakens. The defensible layers shift downward into data models, permissions, workflow logic, and compliance, and upward into networks, proprietary data generation, and real-world execution.

When software goes headless, where does defensibility move? — Read More

AI is changing the way engineering teams complete work and measure productivity, with more time spent on reviewing code, fixing bugs and context switching between tools. When AI generates an organization’s code, output metrics improve, cycle times shorten and developers report feeling more productive for moving through work more quickly.

But 81% of engineering leaders said much of the time saved on coding is now spent reviewing AI’s work. Nearly a third of a developer’s day is spent on this invisible work that doesn’t appear in productivity metrics such as output, the report found.

“It is not the work organizations are trying to accelerate; it is the overhead attached to the work. — Read More

…If you’re a senior developer, and if you’ve played with the agents and skills and models and all the other things that are blowing people’s minds, and if your intuition is still telling you something is off in how people are proclaiming your job obsolete, then here, in this post, I’m going to try and put words to your intuition (as a good copywriter does).

But wait a minute! Many seasoned and famous developers are also proclaiming the death of the developer.

How’s that? Whose intuition is right? And what’s causing this split? — Read More