Lesson 2: Balancing Artificial Intelligence Use Cases (Internal vs External)

Transcript

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Good morning. Check this out. Look at this beautiful, foggy morning here.

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It's beautiful on the east coast of the United States. Good morning, happy 2026. Today and this morning, the topic of conversation is going to be artificial intelligence.

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What do we mean by AI? Well, it's something that everyone has been talking about for what seems like a non-stop level of momentum for the last few years. A few things as it relates to AI. This is really just an algorithm, and we'll get into some of that through this short video today.

But really what I want to focus on is the decision making of how we choose which AI tools we want to use and which use cases we want to use for AI. First off, just really brief introduction to AI. AI is math.

We took a class in college, it was called linear algebra, essentially matrix multiplication. You think about an Excel file with a table of numbers in it, and you multiply two tables of numbers to another table of numbers. That's essentially what's happening with AI.

Those numbers really represent words or pixels or concepts or anything else. That is really the most advanced state-of-the-art use of AI. Some simpler ones, you can look up regression lines.

If you remember back in algebra in middle school, it's like the equation for a line, y equals mx plus b. They call that the line of best fit on a scatter plot. This might be too complex for a lot of you, but assume there's a bunch of housing prices. In your neighborhood, maybe you own a home, you're looking at a home maybe one day if you're fortunate enough, and square footage on one axis, and then the price of the home on another axis, and you see some dots on there.

You draw a line through there, that's your regression line. That's simple artificial intelligence line that will predict the price of the house that you are going to buy or sell or build based on the square footage in that area. Similar type of concept, just scaled up.

Then the question is the use cases. A lot of the use cases in the business world right now is workflow, workflow improvements, workflow automation. You show up to work every day, you log in, maybe you're in a retail environment, maybe you're in a coffee shop, but no matter what you do, you're doing things every day.

You're writing something down, you're interacting with customers, you're talking to other employees, you're creating something, a document, a cup of coffee, some physical object, some service. There's a lot of little microscopic things that you do all day every day. Some of these leading startups are just trying to automate all that, so they're like, hey, let's just get a camera and listen in or record everything that you do all day, and then we'll figure out how to make a robot or either digitally or physically to do that.

That's where a lot of the fear comes in, I think, of taking the job. Because if you're doing everything that I'm doing, then what am I supposed to do? But really, what we're seeing develop, and we're at the leading edge and the frontier across a number of different dimensions here, startups, middle market private equity, and then the Fortune 250, what we're actually seeing is more of an augmentation, not a full-on replacement. So let's say up to 50% of your job is stuff that's just administrative crap you don't want to do, or conference calls last an hour and you're just sitting there scrolling the internet behind the scenes, conversations take way too long, just checking pieces of paper and trying to match something takes way too long.

It's just frustrating. It's like this assembly line mindset that we started the 20th century with in the early 1900s with the Model T and manufacturing, but we're at the stage now where we can use our brain a little bit, right? So I'm sure you have ideas about things that you could do to spend your time more efficiently or maybe have a better work life instead of this stuff that just like kills your soul. So these sorts of things are where I think a lot of the workflow automation will be at first, and that's what we're seeing.

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It's like these sub 25% tasks that you just don't want to do anyways. Get some stress relief back, get some time back, get some space back so you can think more strategically and maybe deliver a better service to your boss, your customer, build a better product. That actually keeps you in your job more, not less, because you're handing off the stuff that anybody could do, the commodity stuff, to something or someone AI that can do it just much more faster and efficiently.

And then you can do the stuff that you're best in the world at. And so I think it would just feel better. So I think if first, before this decision, we got to flip our mindset and stop being afraid of it and say, hey, if I embrace this thing, what new things and new possibilities does that open up for me, right? Like one door closes, another door opens.

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So I think that's the first piece. We got to address some of that fear. All right, next thing is, how do we choose which use cases? And there's really two that have developed, and I've talked about this before.

The first one is internal use cases. The other one is external. Okay, so internal is the one that we just described, internal to the company, internal to your job.

It's not external facing that your customer can see, right? So this is all in, like, back of house. So in a restaurant mindset, it would be like, back in the kitchen, making the food, not front of house, where we're out interacting with customers, we're delivering the food, we're taking orders, delivering a good experience for them, ambience, etc. And so really, what we're seeing right now is a lot of the folks are working on these internal AI use cases.

And the reason for that is because it's easy to understand, I already know what I do every day. Now translating what I do every day into a probabilistic machine like AI into that like Excel matrix with, there's like a table of numbers and another table of numbers and multiplying them. That's why you need experts to help you not just figure out those use cases, but then map those use cases into this new paradigm of like, training software, not just writing software, and then making sure it comes out the other side, correct.

And it does what you want it to do. And it's not like, going haywire. So it's three main areas, right? So you got to figure out what you want to do, you got to like, execute it, make sure it can do it.

And then you got to review it, make sure it's accurate and correct. And, you know, brand guidelines and the whole thing. So that one's cool.

The internal stuff has value, get things done faster, cheaper, more efficiently. But that's not where the real value is. The real value for you, your business, your job, your life, etc, is the external things.

It's the stuff that interacts with the market interacts with your customers. And we talked about this in terms of new capabilities. So what do I mean by a new capability? And I'll use the chat GPT example.

So before chat GPT existed, you had to go to a search bar on Google or Safari on your phone or whatever. And you'd type in a search, and you'd search it and it'd come up with 10 links or 100 links. And you'd have to manually go in and click one and read and like try to find the thing you're looking for.

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That's not it, go back, click another one, read, oh my god, click another one, read, go back, and just kind of try to like piece together little bits and bobs of information. And then in your mind, pull it all together. And then you're sort of just like, oh my god, information overload, I can't deal with this anymore.

And then you close the browser in the computer in your office, right? So what chat GPT did is it just was a new capability, it just compressed all of that stuff into, hey, we'll just do all that stuff for you and just give it to you in precisely the way that you want in the best way that you can understand. It's right now it's text, in the future, it could be something like this audio, video, right, like a phone call, which would be kind of interesting. Your friend's voice, if that's how you learn best, a lecture.

So it's really about that information piece. So that's a new capability that never existed before that was made possible by this new technology of multiplying two tables of numbers together. You see, like, it's crazy, right? Like, it doesn't make sense.

It shouldn't work, but it works because laws of mathematics and physics. Okay, so then here's the real decision point. So how do you balance your time, your investment between an external facing use case, which is difficult because it requires creativity, novel thinking, customer development, it really is the the discipline of product management, which is developing a hypothesis of what the market wants before they know they want it in a productized or service package or framework.

And so that discipline of product management will become very important. And I think the product folks who are strategic, creative inventors, great product mechanics really build products that connect with other human beings and maybe even machines like how they make decisions. Those will be the ones that will be infinitely successful.

And that's where you see the revenue line and the growth line and the profit line go massively up into the right at a high slope. These workflow improvements internally is more like a like a low slope. So the best in the world do both.

And this is the decision point, the best in the world balance those investments, time, money, capital, resources, etc. So the real question is what percent of your budget in the whole company in your whole day to day life, do you deploy to an external new capability, right? requires discovery, creative thinking, sitting quietly and thinking like experiencing the world going out in nature, thinking the other one, which is just pure execution, like, let me write down all these tasks I do all day and then like try to automate each of these. So you could think what's happening now is almost 100% is internal focus in the business world.

And there's 0% on new capability. That's kind of crazy if you think about it. So that balance is like really off because you're, you're over investing in the low slope growth line rather than the high slope.

There's some companies that have a bit better balance, maybe 510 20% on the high slope external facing use cases, new capabilities, and maybe like 80 75% on the low growth, internal use case capabilities. So what's the right balance 5050 8020 2080. I think because the new product development, new capabilities is deemed as riskier.

That's the land of startups, not the land of Hey, we're running a sophisticated business. And we know our customer and our employees best. And we're just gonna, you know, hit singles all day rather than trying to hit a home run.

You're gonna see that balance go from I don't know, 0% 100% to like 2080. But I think the most successful ones will get closer to 5050. And I'll tell you what, because each of these workflow improvements are like little tiny Lego bricks that you line up on a yellow brick road to get you to the promised land or Emerald City if you will.

But then these bigger use case bets are like longer ones that you can line up one after another, they take longer, maybe a little bit riskier. But once they come online, they can work in tandem with these smaller ones. So you'll get like a double compounding.

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And each little brick you lay, you get better at it, you get more efficient, you get more knowledgeable, the team becomes more knowledgeable. Same thing with the top. So over time, you start like the engine of the train is like really slow, there's a lot of friction, just getting it moving.

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And then pretty soon, you're starting to chug a chug, right. And over time, what happens is you're gonna start moving in a good cadence. So those companies, those individuals, those leaders, who balance both simultaneously, I'm thinking, what's a new capability? And also what's a workflow improvement that can enable that new capability.

And these things start to work together. So it's not just like a forward chug. It's also this like, lenticular motion, like a like a screw.

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And these things are like chugging forward, and then the screw is making it work faster. It's like a super semiconductor that's literally pushing energy through a system. And and what happens is that beam starts getting bigger and more impressive.

And so our last talk, we talked about core values. And this is the key, because once you get all that stuff working, you in order to enable that, both in the beginning, and also on the back end of that, you need to connect with humans, which is a core value. You need to say this is who we are.

This is what we stand for. This is why we're doing this. You're safe.

This is a safe place for real talk. Work on these workflow improvements. With that excess time.

Let's start thinking about new capabilities. Oh, is it starting to make sense now? Now I can raise up and think about this. Now my job becomes more valuable, becomes more exciting.

All of a sudden, I'm an artist and an execution person. And so now I'm like double valuable. I'm like a double triple threat on the court, right? So these things become really interesting.

And then because you've built this with strong core values at its center, then you know that you can connect with the internal team. That internal team is exuding positive energy into the market. They're like talking to other team members, people on the street, their family, customers are like, man, this stuff is cool.

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Like I like working here. Like all, you know, at first I was a little scared, but we started doing this thing and it like made my job easier. And so like now I wake up less stressed because I don't have like 100,000 messages and like this huge backlog of like crap I got to deal with.

And then I'm starting to like make these new things and the boss really loves it. The company thinks it's valuable. Company's making more money.

They just instituted a profit sharing plan. So now like for the first time in my life, I'm starting to become an owner in something that I'm building. And like I'm jazzed.

I'm having a blast. Like and then the person on the other side is like, damn, like you got me openings? Can I come? This sounds like fun. And so then you like hit the jackpot because then it doesn't feel like work.

And then it's play. And then we're all having a blast and we don't have to worry about stuff anymore. Money is coming in.

We feel good. We're less stressed. We're flowing through the workday.

We're flowing through life. Family life's better, less stress, less conflict. And it's just this word called harmony.

And I think that's what we're all going for at the end. It's just like a harmonious life. It just feels like we're always in a flow state.

Instead of this like grind it out, like pound a coffee and like white knuckle through life. That's no way to live in work or personal life. So that's the idea.

That's decision point. I think it all stems from core values, safe place for real talk with the team and then balance equally those new capabilities with AI and those internal workflow capabilities. And so, you know, next time we'll start talking about other technologies and use cases, Bitcoin, blockchain, spatial computing, wearable hardware devices, robotics, self-driving, etc.

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And it's a similar mindset, a similar framework, right? It's like on one way we can approach this as fear, as scary, as like threat. The other side, we can flip it and it's the same thing, and it's opportunity. And so your mindset dictates what you get out of this thing.

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So I think the very first thing we have to do is we got to build some belief. We got to flip some mindset shifts and just say, you know, it's going to be all right. Like we made it through COVID.

We made it through the greatest disruption in human history, digitization, technology, the internet, computing, self-driving, global social media, global pandemic. Now we're just on to the next thing. So we're used to it.

It's more of the same. It's just going to happen faster and faster. And so let's just work together and figure out a way to live like a little happier, better, easier life.

And so I think this is the point. This is the vibe we're going for, back here, is just calm. It's calm.

It's peaceful. Everything happens as it's supposed to happen. Some days it rains.

Some days there's fog in the morning. Some days it's a beautiful sunrise. Some days the leaves turn.

Some days it snows. But overall, like we're good. We're living in a closed ecosystem.

So with that, thanks. Have a great day. Sean Everett signing off.

Hit us up at evergence.team. We'll see you later. Bye. Peace.