AI Summary
5 min readIn 2015, when Josh Elman was investing at Greylock, the conventional wisdom was that social media was finished. Instagram, Facebook, WhatsApp, Twitter, and LinkedIn already existed. Why would anyone need another one? That year, he backed two companies anyway: Discord and Musical.ly, which later became TikTok. Both solved problems the incumbents did not—Discord created a place to talk while gaming, and Musical.ly let people create short videos with music, not just broadcast polished moments from their lives. Today, Elman, now a partner at a16z, sees the same pattern repeating in AI. The easy part is getting attention. The hard part—and the only part that builds a durable company—is getting people to stick.
The Wedge, the Habit, and Earning the Right to Expand
Elman argues that the biggest mistake founders make is trying to do too much too soon. A consumer AI product must start by doing one thing exceptionally well, replacing an existing behavior so completely that the user stops doing something else. He calls this the "wedge" into a person's digital life. "What did you stop doing when you started using this new thing?" is the question he asks to gauge whether a product has real traction, not just curiosity.
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What you'll learn
- 1 (00:00) **The Core Challenge: Attention vs. Stickiness** - Josh Elman states the fundamental problem for consumer AI products: getting attention is easy, but making users stick is the hard part.
- 2 (01:54) **Why Josh Returned to Investing** - Elman explains his career arc from operator (LinkedIn, Facebook, Twitter, Robinhood, Apple) back to VC at a16z.
- 3 (03:44) **Consumer Tech: Pre- vs. Post-COVID & The AI Shift** - Comparing the consumer landscape five years ago to today, highlighting the post-COVID rebalance and the rise of AI.
- 4 (05:26) **Where Are We on the AI Journey?** - Elman breaks down AI adoption into three distinct groups: early adopters, the workforce, and mainstream consumers.
- 5 (10:12) **Trust as the New Moat for Consumer AI** - Elman argues that while utility trumps trust in the early adopter phase, trust becomes paramount for mainstream adoption.
- 6 (11:13) **The New Shopping Experience: From Search to Conversation** - A personal anecdote about using ChatGPT to find a specific keychain illustrates how AI is transforming commerce from a search-and-click model to a guided, conversational one.
- 7 (14:23) **Three Big Trends Josh is Excited About** - Elman outlines the key areas where he believes AI will reinvent consumer experiences.
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Guests on this episode
Show Notes
a16z Partner Josh Elman joins Ollie Forsyth on New Economies to discuss the next wave of consumer AI and what separates a product people try once from one that becomes part of their everyday lives.
Josh argues that getting attention has actually become easier, but getting consumers to stick is harder than ever. He explains what he looks for in consumer products, why the best ones start with a narrow wedge and earn the right to do more, and why trust becomes increasingly important as AI agents gain access to more of our personal lives.
They also explore personal AI agents, the future of shopping and entertainment, why we haven’t seen another major social network emerge, and how AI could make technology more social rather than less, including agents that help people spend more time together in the real world.
This conversation originally appeared on the New Economies podcast.
Resources:
Follow Josh Elman on X: https://x.com/jelman
Follow New Economies: https://www.youtube.com/@NEWECONOMIESPOD
New Economies Substack: https://www.neweconomies.co/
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