Alexandr Wang - A Primer on AI

**Patrick O'Shaughnessy** (0:00)
This episode of Invest Like the Best is sponsored by Canalyst. Canalyst is the leading destination for public company data and analysis. Founded by a former buy-side analyst who encountered friction sourcing, building and updating models, Canalyst is now used by over 400 institutions, including the largest money managers globally, and by a number of guests on the show. With detailed company-specific models and data on virtually every public company, Canalyst clients are able to ramp up faster, update models instantly, and incorporate the highest quality fundamental data into any workflow. If you're a professional equity investor and haven't talked to Canalyst recently, you should give them a shout. Learn more and try Canalyst for yourself at canalist.com/patrick. That's canalyst.com/patrick. If you're curious to hear more about Canalyst, stay tuned at the end of the episode where I talk to Canalyst customer Brandon Weir from BWCP to discuss Canalyst in more detail. This episode is brought to you by lemon.io.
The team at lemon.io has built a network of Eastern European developers ready to pair with fast-growing startups. We have faced challenges hiring engineering talent for various projects, and lemon.io offered developers for one-off projects, developers for full start-to-finish product development, or developers that could be add-ons to an existing team. Check out lemon.io/patrick to learn more.
Hello and welcome everyone. I'm Patrick O'Shaughnessy, and this is Invest Like the Best.
This show is an open-ended exploration of markets, ideas, stories, and strategies that will help you better invest both your time and your money. Invest Like the Best is part of the Colossus family of podcasts, and you can access all our podcasts, including edited transcripts, show notes, and other resources to keep learning at joincolossus.com.

**SPEAKER_2** (1:45)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (2:11)
My guest today is Alexandr Wang, the CEO and founder of Scale AI. Alexandr founded Scale in 2016, having been inspired to accelerate the development of AI through his work at Quora and his studies at MIT. Specifically, Alexandr realized there was a lack of infrastructure solutions for producing high-quality data, the lifeblood for AI models.
Today, Scale provides data solutions to leading AI teams at Meta, Microsoft, OpenAI, Flexport, the US Air Force and many others. This time last year, the business was valued at over $7 billion.
Our conversation is a primer on AI. We discuss the building blocks beneath successful artificial intelligence, AI's role in both the public and private sector, and why data is the new code. We also cover the similarities and differences between AI and software from an investing perspective, and what inspiration Scale takes from AWS. Please enjoy my great discussion with Alexandr Wang.
So Alex, we're going to talk about every dimension I think of AI, artificial intelligence, machine learning, all the things that it's going to impact. I'd like to structure our conversation from sort of the widest angle down to the most specific, which will probably be around your specific business and product. But given what's going on in the world today, I think it's probably an appropriate place to start with the role that AI data, machine learning, et cetera, play in geopolitics and foreign policy. We're sitting here in the US, and everyone's mind is on Ukraine. I think everyone understands that cyber is a sort of plane of conflict that exists, but we don't know a whole lot about, to be honest, even I don't know a whole lot about. So I'd love you to give us your overview, given you've got a sort of insider view and seed and understanding of all this. What role does AI play in the global theater today in your view?

**Alexandr Wang** (3:52)
A few assumptions to talk through, a few things to talk through that I think are really relevant here. I think one is that generally speaking, deterrence has been an incredibly positive thing for world peace and the stable world order over the course of the past 40, 50 years. I grew up in Los Alamos, New Mexico, which is the birthplace of the atomic bomb.
The deterrence from the atomic bomb has been an incredible forcing function for a stable and peaceful world order. And I think where we're at today in a broad sense is that there's an entirely new set of technologies that are either in early development, being developed right now, or have been recently been developed, that are significantly shifting what conflict looks like in general. One of these is cybersecurity, which you mentioned, which is a very challenging general attack plane, because it's generally speaking almost impossible to defend against and the attacks are numerous in nature. There's sort of like these shots that can produce a lot of attack vectors.