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We founded appliedAIstudio based on the idea of human-centered AI–AI that helps people. To make this idea sustainable and scale beyond just us, we needed to be profitable. The common wisdom for launching for-profit startups (rooted in the world view of the factory) didn’t work with our human-centered vision. Instead we adopted the Studio Model–a worldview for launching startups that prioritizes people, partnerships, and experimentation in pursuit of a vision.
On May 11, 1997, chess grandmaster Garry Kasparov lost the World Chess Championship to IBM's Deep Blue. He was, in a sense, one of the first to lose a job to AI. Instead of seeing AI as the enemy, Garry wondered what would happen if humans and AI worked together. In 2005, he hosted a tournament for chess centaurs—half-human, half-AI teams. He invited supercomputers, grandmasters, and teams combining both. The results were shocking. The grand-prize winners were a team of two amateur humans and three weak computers. The three computers searched for the next best move. When they disagreed, the human helped resolve the conflict. Effective cooperation mattered more than individual ability. Problem-solving centaurs (or intelligence that augments rather than replace people) are the most valuable applications of AI.
People are great at noticing, investigating, and connecting meaning to patterns–even better than the most advanced AI. Finding the right human-AI relationship can be difficult if we assume that the most valuable use of AI is efficient operations. But when we put first the well-being of those impacted, it becomes much easier to define the ideal human-AI relationship: make AI that augments people and improves the human condition. How can we make it easier for an expert to record and share what they know? How can we make it easier to reduce food waste or stay at home as we age?
the human-ai connection
we design things that augment people rather than replace them
We founded appliedAIstudio in 2021, but the fundamental ideas for the Studio started to occur to us years earlier. While working for a global IT consulting firm, we began a collaboration with the Scott-Morgan Foundation, a partnership that continues with the appliedAIstudio. Peter Scott-Morgan and his husband Francis created the Scott-Morgan Foundation after Peter was diagnosed with amyotrophic lateral sclerosis (ALS). ALS is a progressive neurodegenerative disease that robs a person of the use of their body. As Peter’s disease progressed, it took his ability to create art, but not his artistic ability. We created an AI that Peter could use to make original pieces of art. AI couldn’t fill the chasm left by ALS, but it could provide a bridge.
While we had considerable internal latitude, for the consulting firm, the primary goal was still to make and save money–corporate applications of AI. Doing good was okay as long as it didn’t (in any way) interfere with the bottom line, and projects run like the AI Artist weren’t the norm. We decided to start our own company to do the work we wanted to do. In 2021 we founded appliedAIstudio to focus on human-centered applications of AI and demonstrate the impact of putting social good first.
the studio model
The traditional worldview for starting a for-profit company is that of a factory. Discover something that people are willing to buy and build a machine (a money machine) for serving that market as cheaply as possible. Having money is fantastic. Having a money machine is even better, but that wasn’t our primary goal. The goal of the factory is to optimize processes for profit and prioritize processes over people. The Studio’s goal is to use human-centered AI to help people. We needed a different worldview. We needed something that worked more like a studio. A studio is a place where visions are nurtured. Resources are gathered into a studio and applied by creators to make those visions reality.
The studio model is not new. The entertainment industry has used this model for years. Very roughly, to create a feature film, there’s a writer, director, producer, and production studio. The writer has a vision and creates the story. The director turns the story into something people can watch in cinemas. The producer gets the project funded. The production studio makes everything the film needs.
Applied to human-centered for-profit companies, these roles become the startup, the customer(s) zero, the sponsor, and the publisher. The startup has the vision of a human-centered impact on the world. The customer zero is the minimum-viable audience needed to support the vision and make it a sustainable reality. The sponsor is the investor. A traditional investor with a factory mindset is primarily motivated by a return on investment. But the sponsor is motivated by the opportunity to expand their identity. The sponsor is investing in the effort because they want to be associated with the story. The publisher is responsible for telling the story. Those are the four fundamental collaborators in the studio model of startup: the startup, customer(s) zero, the sponsor, and the publisher.
In the factory, progress is a matter of accumulation that typically requires some kind of increase in production. Progress is reported through analytics, metrics and lists. In the studio progress is a matter of creating value. That value has to be observed by the stakeholders. It’s recognized through a process of release, review, reaction. In the studio model, progression happens by scheduling a series of checkpoints. In each checkpoint, collaborators review the latest release. Progress is evident when the collaborators confirm that what they see in the current checkpoint is more valuable than what they’ve seen in previous checkpoints.
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In the studio, things will go wrong. And when they do, it’s necessary to pivot. In the factory, pivoting is about retooling the factory to create a new product. In the studio, pivoting means something different. Remember that the point of the studio model is to make some vision a sustainable reality and to make an impact along the way. It becomes necessary to pivot when you realize that the road you’re on won’t get you to the destination you want. When that happens, you keep your destination fixed, pull over, and chart a new course. We started, for example, with the vision to create human-centered AI, and when it was founded it was a service-based consulting company, because that’s what we knew. We thought helping other companies build human-centered AI was the best path. We were wrong. Our new plan was to become a product company.
For-profit AI startups have the potential to do an incredible amount of good in the world. The studio model is a game-changing alternative for launching these startups. From AI that feeds people to AI for aging at home, small, focused partnerships can launch profitable services with big impact. But it takes resilience.