tom ogrodzki

Could AI run a real estate company 3/3

Hi!

A few weeks ago, I gave a keynote about AI at Entralon Club’s CEE Business Retreat event. It’s an exclusive off-site gathering for top real estate investors and developers. Many attendees said the presentation was eye-opening, so I thought I’d transform it into a post and share it broadly.

Enjoy, Tom

Could AI run a company?

Mindset 2: Crisis manager

Before we dive into the mindset, let’s talk about aviation for a second:

Why don’t planes fly autonomously?

This question has been bugging me for quite a while, ever since I read the amazing book “Where’s My Flying Car?”.

Why do we still have human pilots when autopilots control planes for over 90% of the flight time? Why human pilots when digital autopilots were introduced in the early 1970s?

Mostly, it’s psychology. In aviation, over the past century, we’ve built a safe human-based system with a 1:11,000,000 probability of a fatal airplane accident. And that’s the main reason we don’t change it. Even if we can improve it with some tweaks, we are afraid to touch its key principles. And that is, a human pilot.

On the other hand, the chances of dying in a car crash are one in 5,000. That’s 2000 times higher!

The difference between autonomous cars and planes lies in a trust system and the impact of potential changes.

Here’s an important lesson for CEOs:

Not every tech advance will happen, only the ones that will bring profits to investors.

So, what are aviation corporations doing with their billions to use the edge of AI?

They make more billions.

IMPROVE.
REDUCE.
FASTER.
BETTER.
DECIDE.
ADAPT.
AVOID.

These are the key words when it comes to AI applications in any industry, including aviation… and commercial real estate.

What do crisis management and AI-CEOs have in common? Why are human-based systems so grounded?

We, CEOs, have skin in the game. So do human pilots.

We know that, our passengers know that, our families know that. And, importantly, our investors know that.

They know we care.

The real question is: can we make AI care?

From a technical perspective, we can try. For example, there’s reinforcement learning - a reward/penalty model that can influence how AI reacts to certain situations.

But I always say:

AI instructed to win at roulette… will just go bankrupt.

No shouting, no crying. No questioning your instructions, no stress with every next loss. No hard feelings. No feelings at all, actually.No shouting, no crying. No questioning your instructions, no stress with every next loss. No hard feelings. No feelings at all, actually.

AI is only as good as the data it’s given, and the instructions it follows.

So, when it comes to management, a human CEO is still a much safer choice. While it’s not cheap and their plans can change, a human cares.

On the other hand, AI just follows instructions. So, someone must make decisions on the instructions themselves. And who will that be?

So can AI be a crisis manager?

(yet)

Billion-dollar opportunity

So, could AI run a company? Maybe one day, but today we should focus on a different question:

Where is your billion-dollar opportunity in AI?

To find that, we need to challenge another question: why are we actually interested in technology at all?

“Technology is miraculous because it allows us to do more with less.”
– Peter Thiel, Co-founder of PayPal

There’s only one requirement for this opportunity to work for you:

As oil was needed for the industrial revolution to happen,
As electricity was a must-have for the internet to be invented,
The same data is needed for AI to happen.

No data, no AI.

But when data is in place, then comes the huge opportunity, and it takes many forms we’ve discussed in these posts:

Thank you! (and don’t panic)