At the beginning of a Y Combinator event, OpenAI CEO Sam Altman pointed out that the emergence of Artificial General Intelligence (AGI) is fast approaching. He emphasized the importance of designing products considering this upcoming progress.

Altman also highlighted that GPT-5, which is also expected to be achieved soon, will greatly outperform GPT-4, which has been at the forefront for nearly two years. According to Y Combinator’s founder Richard He, most of GPT 4’s limitations will be fixed with GPT 5 without going into any specifics.

This swift advancement in AI technology poses significant hurdles for both new startups and well-established firms, as they have traditionally planned based on a slow and steady improvement in AI models.

Altman recommends embracing cutting-edge AI models while avoiding excessive fine-tuning or early optimization. The key is to envision products functioning with an extraordinarily advanced AI, sometimes referred to as a “godlike” model, and to create products aligned with this high-level vision.

The emphasis should be on designing outstanding products and user experiences through the use of sophisticated AI agents, rather than investing heavily in creating new models or premature optimization. The belief underpinning this strategy is that the ongoing advancement of AI models will result in major improvements in their products, possibly amplifying their effectiveness by 10 to 100 times.

Other key takeaways from the kickoff event for Y Combinator W24 at OpenAI HQ include the need for startups to use contextual optimization more than behavior optimization. For instance, providing information via RAG, etc. could prove to be more beneficial than fine-tuning in the long run.

OpenAI also promised to make its API even faster, more reliable, and cheaper in the future but also highlighted that performance will always be limited according to the costs. For instance, the iPhone will always limit its performance to consistently provide a 1-1.5 day battery life even though battery technology has greatly improved over the years.

According to industry expert Howie Xu, GPT 5 may become official in 2024 while AGI could possibly be achieved in 2025.