The AI Daily Brief: Artificial Intelligence News and Analysis - How to Build an AI-Native Company Today

Starting point is 00:00:00 A year ago, it was a very different time in enterprise AI. Companies were still talking about things like how many use cases they had for AI. Now year on, we are no longer talking about use cases. Everything, it turns out, is a use case for AI. And in fact, in 2006, the long-awaited, much-discussed transition to agentic AI actually began. Surrounding that, companies have undergone a significant transformation process, one that pretty much everyone is still in the midst of. And yet, as companies try to become more AI-native,

Starting point is 00:00:30 The question is, what does that actually mean? What are the hallmarks and characteristics of companies that are not just glomming AI and agents onto old processes, but are really doing things in new ways redesigning from the ground up? While it's all still emerging, I think we're at the point where we are starting to see a set of features and characteristics that define AI-native companies. The AI Daily Brief is a daily podcast and video about the most important news and discussions in AI. All right, friends, quick. announcements before we dive in. First of all, thank you to today's sponsors, Blitzy, section, robots and pencils and hyperagent.

Starting point is 00:01:12 To get an ad-free version of the show, go to patreon.com slash AI Daily Brief, or you can subscribe a novel podcasts. And to learn more about sponsoring the show, send us a note at sponsors at AIdailybrief.A.i. Finally, we're coming up on your last chance to sign up for the latest cohorts of the next executive agent training programs from Super Intelligent. So if you listen to this episode and decide that you too want to be more AI native and think those could help, you can check them out at training. dot be super.AI. Welcome back to the AI Daily Brief. Today we have a fun one.

Starting point is 00:01:40 I feel like at this point, pretty much all of you are either at big companies who are trying to adapt and become the next version of themselves in this AI-enabled world, or are the people who are being hired by those companies to help them with that adaptation. Whichever side of that table you find yourself on, a core question that exists underneath all of that transformation is, what are we actually transforming into? A term that gets thrown around a lot is AI native. Part of the attraction of the term is that it separates companies that have simply glommed on AI and agents to old processes from those who have actually rethought from the ground up to take advantage of this new era. But what is the substance of AI nativeness?

Starting point is 00:02:19 Part of what makes it great for a podcast is that there are a lot of things, and many of them are debatable. Enter Alex Lieberman. Alex is the founder of 10x Labs, which is a company that helps transform existing companies into AIN. native companies, and before that he was a founder at Morning Brew. As you might imagine, that experience at Morning Brew means that he is often a great source of content. And the post that inspired this episode is actually a direct crib from his ex account recently, 30 features of an AI native company. What I thought would be fun, after turning it into a beautiful 1950s retrofuturist themed presentation with the help of Codex and GBT Image 2, is to go through

Starting point is 00:02:57 these features one by one, where I will share the aspect of AI-neediveness that Alex posted about, and then add any thoughts, qualifications, disagreements, although I don't think that I necessarily disagree in a lot of places, and other observations that I've seen in my work with enterprises as well. Now, I should note that I don't think that this is in any particular order. In fact, you can very much tell that this is not AI generated, as it reads much more like a stream of consciousness than, frankly, most of the content that you're used to seeing these days, which is kind of a breath of fresh air. First feature of an AI native company is to blueprint every process, to create, in Alex's words, a function-by-function process blueprint of the entire business.

Starting point is 00:03:35 Now, I said I wasn't going to disagree much, and I'm not exactly going to disagree here, but this is one area where, although I don't disagree with doing this, I think the reasoning behind it for a lot of companies is actually leading them down the wrong path. Some of the reasons that it's valuable to blueprint processes. In other words, to map out how work actually gets done, is that a lot of that information right now lives locked inside people's heads. There are a lot of nuances and edge cases that people have been handling on their own forever, and which are perhaps transmitted person to person through random spoken meetings in the hall or side chats on Slack that don't ever find their way into actual operating manuals. That puts the AI and agents that you're

Starting point is 00:04:17 bringing into assist with the work at a disadvantage because they're recreating things from the ground up. And so having better maps of how work currently gets done is an incredibly valuable piece of context as you redesign your organization around AI and agents. So all of that part I agree with. Where I get concerned is around an inherent assumption of process mapping that I see pretty often. The assumption is that agents are going to do things the same way that humans do. I think that that's very unlikely to be true. And in fact, I think artificially constraining agents to do things along the pattern of an old workflow is in many cases the wrong approach, as opposed to, for example, giving them the goal in articulating the guardrails of what they can

Starting point is 00:04:59 and can't do and letting them figure it out from there. Now, again, that doesn't make process mapping not valuable, but we have to understand and prepare for the reality that the best way to do something in the future will not necessarily just look like an efficient version of the way that we did it in the past. Feature number two of an AI-native company is highly uncontroversial, and that is to give everyone a daily driver, i.e. everyone in the organization gets to use a daily driver harness such Grockbot, Claude Co-work, or ChatGPT at work. Now, what's interesting here is that nine months ago, 10 months ago, when you saw the term daily driver, you would have assumed you may just access

Starting point is 00:05:33 to a frontier model. In other words, people have access to ChatGPT or Claude. But what Alex is talking about is a specific work harness, an environment in which models operate that is designed specifically for advanced knowledge work and coding, whether that's for software engineers or for non-software engineers who are now using code as part of the way that they do their job. Getting comfortable with a harness means getting comfortable with context. It means being able to understand and organize skills, as well as understanding how to provision access to different tools. Like I said, nothing controversial here. The one thing that I will note is that I think that we are going to increasingly see people rolling their own harnesses, often on the basis of an open source foundation. For example,

Starting point is 00:06:09 deepseeks harness that just came out because they're going to want peak flexibility and they're not going to want to deal with things like investing in cursor only to have it sold and no longer being able to access certain models through it because of that sale. Feature number three is one that many in the comments noted is to use AI's favorite term right now, load bearing for the rest of the features. The idea is to build one intelligence layer, to aggregate structure and unstructured data, documents, and business logic into a single source of truth that is queryable, and that agentic work can be built on top of. It is unquestionable that AI-native organizations are going to get good at organizing the context their agents need to work.

Starting point is 00:06:46 Context management is and will continue to be a major discipline in this new org transformation period. To the extent that I have quibbles here, which is really just for the sake of interesting conversation, I kind of like the metaphor of a mesh or lattice rather than a single layer, because I think especially as you get into larger organizations, trying to have a single source of truth for everything, rather than sources of truth that can interface with one another and that agents can traverse, perhaps even uncovering and trying to reconcile with human support differences in sources of truth is perhaps a more accurate reflection of how this is going to look with the biggest organizations,

Starting point is 00:07:19 but obviously the substantive point underneath remains. Feature 4 of Agent Native organizations is one that has been a big subject of conversation on this show for the last few months, which is about using model routing to optimize cost per successful task across the business. I think this is right, but it's not just a matter of task routing. I think that task routing is part and parcel of an overall model architecture that is designed to be adaptable and flexible to different types of tasks. I think in some cases that will be reducible to using a router, but in many cases we'll also implicate a larger architecture

Starting point is 00:07:50 based around that idea of matching task difficulty to model capability. Number five is an interesting one in the way that he frames it. He says that AI-native organizations will treat context as code. They'll keep architecture documents and conventions updated while making diligent upfront planning part of the operating discipline. In other words, they will treat context not just as the background info that is required, but as the actual foundations upon which agents are building. It's a subtle but important distinction, and I think reflects the idea that a lot of this

Starting point is 00:08:20 AI-nitiveness is not just in operational process, but also comes down to mindset shifts as well. Speaking of, feature number six is totally about mindset. Be willing to throw away everything you've built every three months and reimagine the workflows from first principles. Now, I think throwing away everything you've built might be slightly dramatic, but it is absolutely the case that we need to design these new systems for assumptions of change rather than assumptions of stasis. The frequency with which systems will need to be updated, whether it's three months or six months or nine months or a year, or a sort of perpetual update marked by bigger periodic

Starting point is 00:08:55 reimaginings. However, it actually plays out, change is the name of the game, and it's something that organizations are going to have to get way, way more comfortable with than they are today. And that includes not getting attached to the exciting way that you figured out to do something just a couple of months ago, because if the AI companies do their jobs well, advances should mean that we have new ways to do things that are either easier or more powerful. Feature number seven is about info sharing across the organization. Alex says that AI-native organizations will use a skills distribution system to manage agent behavior and improve token efficiency by triggering consistent skills throughout the workflow. In other words, organizations will distribute skills, not just prompts.

Starting point is 00:09:33 I think this as well as emblematic of a bigger shift, which is the discipline of agent management coming to the four. Skills are a key aspect of agentic systems, and so having ways to improve them, share them, access them, et cetera, across the organization, not just within the silo of any individual, is going to be increasingly important. Future number eight is about the changing relationship between technical and non-technical team members. I think we're mostly past the days where people think that when we talk about vibe coding or using code for knowledge work, we somehow mean that all of a sudden the folks in marketing and HR are going to be the software developers instead of the existing engineers? That's not what's happening. But what is happening is both

Starting point is 00:10:12 that those knowledge workers are for the first time able to build things themselves as a way to help do their job. And second, they have more ability to contribute to product and engineering discussions than they might have in the past. Feature eight of AI native companies from Alex's list is to separate intent from implementation, to keep technical implementations separate from high-level specifications, so non-technical staff can contribute in a format agents can turn into implementation plans. I think one of the ways that this will play out is as we see more agents triggered from shared spaces, that's a natural place for some of this to happen. For example, when Claude Tag was announced, one of the more remarkable things about it was members of the

Starting point is 00:10:50 Anthropic technical team saying that that was how they initiated a lot of their building now. And by a lot, I mean the number that sticks out in my head is like 60% or something ridiculous us like that. If agents are being triggered from shared spaces, that creates more of an opportunity for different people to contribute to those conversations, but that in and of itself is going to create a different type of burden and new types of system requirements, which is what Alex is talking about here. Feature number nine is a cost efficiency feature, where AI-native companies will make cost per accepted pull request a key software metric and drive it down through better token efficiency. I think we are just at the beginning of the period of figuring out what the

Starting point is 00:11:25 key metrics of agentic delivery are. And what's clear to us at this point is that whatever the metrics we land on are, it's likely that they include some sense of completeness, as well as cost per completeness, in order to be able to better compare model harness combos in a more apples-to-apples kind of way. Every AI coding tool on the market does the same thing first. It starts writing code. Blitzy does the opposite. Before writing a single line, Plitzy spends days reverse engineering your entire code base. Thousands of agents ingest millions of lines mapping every dependency, every undocumented constraint, every architectural decision made over the last decade. The result is a dynamic knowledge graph that understands your software the way a principal engineer would after 30 years in the building.

Starting point is 00:12:09 Other tools guess at context with grep searches and markdown files, Blitzy never guesses. It builds true understanding first, then delivers over 80% of entire software epics autonomously. Validated, end-to-end tested production grade pull requests. That's why Fortune 500 engineering teams trust Blitzie with the codebases that matter most. See for yourself at blitzy.com. That's B-L-I-T-ZY. Here's a harsh truth. Your company is probably spending thousands or millions of dollars on AI tools that are being massively underutilized. Half of companies have AI tools, but only 12% use them for business value. Most employees are still using AI to summarize meeting notes. If you're the one

Starting point is 00:12:46 responsible for AI adoption at your company, you need Section. Section is a platform that helps you manage AI transformation across your entire organization. It coaches employees on real use cases, tracks who's using AI for business impact, and shows you exactly where AI is and isn't creating value. The result, you go from rolling out tools to driving measurable AI value. Your employees move from meeting summaries to solving actual business problems, and you can prove the ROI. Stop guessing if your AI investment is working. Check out section at sectionaI.com. That's SEC, T-I-O-N-AI.com. At this point, it's no longer a question of whether companies are actively using AI. Using it well, on the other hand, is a whole different story. Robots and pencils, though,

Starting point is 00:13:28 is a company that I can point to that is actually built for this time. They're an applied AI engineering firm working directly with clients on problems that matter to the business, not experiments that live in a slide deck. Every engagement starts by working backwards from the outcome a client actually needs. If you're trying to tell real AI engineering apart from noise in this space, that's the difference maker. Head to Robots and Pencils.com. This episode of the AI Daily Brief is brought to you by Hyperagent, where you run fleets of agents your team can manage together. Forget local agents and chat workflows wait on your laptop to be prompted. Hyperagent

Starting point is 00:14:01 deploys always-on agents in the cloud, doing real work across the tools your team already uses. Marketing agents turn competitor moves into landing pages. Sales agents enrich leads, draft emails, and updates the CRM. Ops agent chases the paperwork and tracks the budget. Every agent has access to shared context and

Starting point is 00:14:16 follows your rules about scope and approvals. It's time you add agents that feel like teammates. Hire yours at Hyperagent. Get $100 in credits at hyperagent.com slash AI Daily Brief. Feature 10 is perhaps one of the features that many organizations are the farthest along with, which is to build agent-native development systems, letting fleets of coding agents plan, write, test, review, and ship code while humans define intent and acceptance criteria.

Starting point is 00:14:44 This is a lot less controversial than it would have been a year ago, but obviously there are still many organizations that are using a traditional process, despite their likely being an inevitable shift that will happen in the coming years. Feature 11 once again gets at the sub-theme of token efficiency, dividing the business of work into planning phases and execution phases, using higher effort models for heavy planning and then executing with cheaper and faster models, the good thing will be that if we've done our job with feature number four about designing efficient token architectures, this is the type of division of labor that should naturally fall out of those systems.

Starting point is 00:15:16 Feature number 12 feels at first glance fairly term heavy. It's use CLI tools to parse metadata in markdown files and traverse dependency relationships, allowing agents to be precise about input token usage, but really this is a technically specific way of designing a more token-efficient system. Basically what Alex is arguing for is organizing a company's knowledge in a way that agents can only load the slice they need rather than the whole thing. It feels related to the idea of progressive disclosure, which is an information architecture pattern where complexity is unpacked, gradually and in sequence, in order to not create too much context overhead when an agent is working. Now, in addition to just making agents work better, there are obviously cost dimensions of that as well,

Starting point is 00:15:59 and why I'm glad Alex included it is that so far we've been operating at a really high level, but this is an example of where you start to get granular and actually do things differently, i.e. making sure that the metadata that an agent can reference to understand whether something is useful is right there at the top of knowledge files that it has access to, so that it doesn't waste context window on things it doesn't need. With feature number 13, we're starting to get into specific parts of the organization. He suggests that finance will run more continuously, moving accounting and recordkeeping towards continuous processes, resetting forecasts on a much tighter cadence. OpenAI CFO Sarah Fryer actually recently wrote about how she had done this inside OpenAI and about what a mindset shift and a technological

Starting point is 00:16:39 discipline it took to make this sort of change. Alex also suggests that in AI native organizations, other parts of the organization, and specifically the larger agentic operating system through which it runs, will have access to those financial models so that that can be part of the logic as strategy and tactics are designed. AI Native Company Feature 15 is the citizen developers SDLC. It's an approach that Alex has talked about elsewhere as well that enables non-technical employees to take a solution that they are building with coding tools from idea to production with the company's governance, access, versioning, and software conventions built into it.

Starting point is 00:17:15 It's basically a process of reconciling the things that the non-engineers are making with the way that engineers build, again, not with the idea of replacing software. where engineering in any way, shape, or form, but in order to have the new things that people are building for themselves or their teams, or even some segment of customers based on the part of the customer lifecycle that they touch, to have that all contiguous with the engineering organization. It reflects again that shifting relationship between different parts of the organization in this new AI-native space. Feature 16 gets to the sort of loop engineering that we covered in the webinar that I've shared on the show earlier this week. Make non-engineering workflow

Starting point is 00:17:49 self-improving by learning from previous runs through external performance metrics and internal evaluations. The idea of loops is that instead of prompting agents, we give them a goal and bumpers around what they can do and design a process that they can loop through over and over again until they achieve that goal. One of the necessary requirements of a loop is some verifiable success metric that is objective rather than subjective. I.e., I need to achieve an X percentage result on this test is a lot more definable and outcome goal than is our interface needs. needs to look good. AI-native organizations are going to be good at creating those sort of clear metrics of success, not just for the easy deterministic tasks, but for the broader array of

Starting point is 00:18:28 knowledge work tasks that don't necessarily have that sort of success criteria built in natively. Feature 17 is really two parts. One is to use some AI ROI framework, to have an idea of what the organization is looking for out of its AI efforts and to be able to measure against that. The second part is a little bit more opinionated from Alex about the way to set that up, with his recommendation being experimental scaling and optimization phases and bets placed across infrastructure, innovation, and efficiency. Whatever the phases that you end up using and the way that you organize different types of efforts, I think that the big recommendation here is to have a complex ROI architecture that can understand the goal of different efforts as being different

Starting point is 00:19:07 from one another, but the organization having the ability to judge them even if they are different all within the same framework. Feature 18 is my Dr. Strange Theory of Agentic Work come to life. The idea is that AI-native organizations will use agent swarms to deploy many, many, many, perhaps hundreds, perhaps thousands of paid marketing creative variations for testing before increasing spend on ads. One of the things that I underestimated when I was first thinking about that, which by the way, I still think is completely inevitable, was the way in which compute constraints in the short term would limit the viability of that sort of approach. Now that we've crossed this capability threshold, where many, many models are good enough right now to actually do this

Starting point is 00:19:45 sort of creative work and will be vanishingly cheaper than they are right now, six months from now. I think that's when you'll start to see this sort of experimentation become a little bit more normalized, and I think it's going to be super, super interesting to see. Fascinatingly, and it's way beyond the scope of this particular conversation, I almost see a marketing barbell where you are going to have just doctor strange, crazy agentic swarms on one end of the spectrum, and utter number denying human taste for brand campaigns on the other, basically Rick Rubin on one side and machines on the other, and somehow it'll work. Feature 19 is another specific marketing recommendation of auditing, rewriting, and generating

Starting point is 00:20:21 SEO-optimized articles every week, then measuring to see whether any of it worked. I think the broader idea is that there is just so much interesting room for experimentation with content-based strategies now that the cost of producing content has gone down. Like so many of these recommendations, the idea here is that the AI-native organization is not just going to do the thing, but to build learning systems around the thing to do it even better in the future. With feature 20, we're getting into cybersecurity, something that has obviously proven itself to be extraordinarily important over the past several months. Alex suggests that AI-native organizations are going to fight AI with AI, using agentic cybersecurity

Starting point is 00:20:58 systems built to defend the organization against AI-powered threats. Now, I think this is absolutely true, but boy, is there a lot to figure out about exactly what type of cybersecurity capabilities, organizations, and legitimate defenders are going to have access to and how that's going to be provisioned. These are going to be some of the most important design and policy questions for AI companies and governments in the immediate term now that we've crossed some of these critical cyber thresholds. We're in our final third, and I'll pick up the speed a little bit from here. Feature 21 is another approach to token efficiency and cost management, combining a reinforcement learning gym with first-party data to fine-tune open source models for high-volume processes

Starting point is 00:21:34 that needs data-of-the-art performance at reasonable cost. Basically, we now live in a world where the prevalence of customizable and post-trainable open-wates models that are very near the frontier opens up a lot of new opportunities for AI-native organizations, many of which will find that this sort of model discipline is actually going to be useful for them. Still, I would say that I don't believe that every organization is all of a sudden going to be rolling their own models. I think that there are going to be lots and lots of ways that all the labs and hypers try to deal with cost efficiency.

Starting point is 00:22:01 But to the extent that you're an organization that actually has this technical capability, it's definitely a place that you could be exploring to get an edge right now. Feature 22, we'll call the human sandwich, keeping human touch and judgment at the first and final mile of most processes. If the argument is that even in AI-native organizations, there should always be people on either sides of the work sandwich, that I agree wholeheartedly with. What I'm less sure is where we'll find the right intervention points are for humans in the middle of processes.

Starting point is 00:22:28 Yes, there will be many, where it pretty much all happens agentically, but I don't think that we know exactly the right patterns, so to speak of this one too generally, feels harder for me to have a lot of confidence around. Feature number 23, I think, is a little bit less arguable, which is the idea of making eval's core infrastructure. Now, the specific example Alex gives is whenever new models arrive, uses a standing apparatus to test their cost and performance against the company's core processes,

Starting point is 00:22:53 but I just think everyone is now in the eval business more generally. Again, going back to the entire architecture of looping instead of prompting, you have to basically build in evaluation against some standard or else the loops don't work. Thinking in terms of eval, is just a new part of the discipline, and it's going to get to some weird parts of the organization that you wouldn't necessarily expect. Feature 24, again, totally unarguable to me, is that everyone is a builder and that AI-native organizations will make building parts of every role, including

Starting point is 00:23:22 and especially perhaps those held by C-level executives. I am not sure that every single person and every single knowledge worker goes from doing their work to managing agents that do their work. I think that'll be a big chunk of work, but again, saying all of it is a pretty big swath to cover. what I feel much more confident saying is that the capacity to build, to use code, to develop prototypes, to develop products, to do your work is now a critical capability. Now, of course, over time, the space between people and the code that they use will get farther and farther as products obscure and abstract the technical details away, but that won't make people less of builders if they can still build things to solve their

Starting point is 00:23:59 problems and create new opportunities. This one is both practical action and mindset shift and has some pretty big implications for how enterprises even organize themselves. Feature 25 is kind of the twin of Feature 1. Record everything worth learning from because what the organization does not capture cannot be turned into AI-enabled work. This also gets at evals, context transmission.

Starting point is 00:24:20 We just need to live in a paradigm of capturing a lot more, much to the delight, I assume, of the 75 meeting note takers that show up in every Zoom call you have now. Future 26, I love because people don't talk about this enough. Governance is so frequently seen as a blocker of innovation, but AI-native organizations are going to treat governance as a transformation partner. They are going to treat it, in other words, as a way to unlock innovation. That's only going to work if you have legal, HR, and IT, work in lockstep with the owners of the AI agenda,

Starting point is 00:24:50 helping to design the enabling policies that address issues while unlocking new types of work. This, I think in many ways, will be a key hallmark of truly great AI-native organizations versus those that are still kind of bolting AI on to old ways of working. Feature 27 harkens back to the idea of constant transformation. AI-native organizations will maintain a bias towards disrupting the company before someone else does it for you. This extends beyond just how you do your current work, but cuts all the way to what work you should be doing. I think a lot of the big transformation of AI is not just going to be in the efficiency with which you do today's tasks, but finding those sort of orthogonal and aligned opportunities that you might not have gotten into yet,

Starting point is 00:25:31 but which AI now enables you to go do. Feature 28 is kind of the technical twin to governance as, unlock instead of governance as blocker, and you could sum up as guardrails before features. Agents inherit the permissions of whoever is asking, and those permissions are enforced in the data layer. You build the guardrails in, you don't have to relitigate it every time. Feature 29 could be an entire show on its own, and it's the idea that autonomy must be earned. These sophisticated powerful agents are not given full autonomy right away, but climb a ladder. Observation, suggestion, acting with approval, acting alone, until they can run whole

Starting point is 00:26:03 workflows inside a defined boundary. Even if we're trying to identify everything, we don't have to identify everything all at once. And the old adage about an ounce of prevention being worth a pound of cure I think is very applicable here. Feature 30, once again, is about the information system that surrounds everything that you do in this new agentic era, tracing every output to its prompt, model data, and approver, so human feedback attaches to something specific, not to a vague sense that something is off. We have the ability to create much more comprehensive and complex systems that surround our work,

Starting point is 00:26:31 and if we do so, it comes with all sorts of benefits that improve the next work to be done after that. So that is Alex's list with a lot of great food for thought in there. When it comes to what's missing, one of the best answers I saw in the comments came from a number of people but was summed up by Binti-Gimeel who writes, clear ownership and accountability. AI can automate a lot, but someone still needs to own the outcome. Every AI workflow should have a clear owner, measurable goal, and someone responsible when things go wrong. The best AI native companies won't just ask, can AI do this? They'll also ask who owns the result. This, my friends, is nothing short of a new management discipline. And it's a management discipline that applies not just to the current

Starting point is 00:27:10 managers, but to everyone, because everyone is becoming a manager of agents as well as an implementer of their own work. For that reason, a lot of this is going to have to be pressure tested in practice, learn through experience and failure, and then summed up as collective wisdom that we can all share. Hopefully there is some good food for thought in here about how you help your company become more AI-native. For now that, that is going to do it for today's AI Daily Brief. Appreciate you listening or watching as always. And until next time, Peace.

The AI Daily Brief: Artificial Intelligence News and Analysis - How to Build an AI-Native Company Today

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.