This article has been translated with Deepl.

HELLO THERE! Magnus Mähring – expert on artificial intelligence

Magnus Mähring. Photo: Juliana Wiklund.

AI is here to stay and no one knows where the new technology will be in 10 years. But it is clear that it will change the daily lives of many small businesses and start-ups. So how will entrepreneurs benefit from AI? And what are the risks? Esbri asked AI expert Magnus Mähring, Professor of Entrepreneurship and Digital Innovation at the House of Innovation, Stockholm School of Economics.

Which type of artificial intelligence has the greatest impact on small businesses?

– The most talked about technology right now is large language models (LLM), which ChatGPT and Microsoft Copilot are based on. Using large databases and probability assessments, it answers questions and writes different types of texts, creates images, etc. Many already use ChatGPT in their daily work and it is expected to become a personal assistant for many people in the future. It is probably white-collar jobs, rather than service jobs and jobs that require physical skills, that are most affected by this technology.

How are small businesses affected by AI today and in 10 years?

– Let us distinguish between established small businesses and start-ups. For the first group, AI offers significant productivity gains by simplifying certain processes, such as accounting and all forms of communication. This also means that small businesses offering these services have reason to be concerned as customers may increasingly insource these services.

– Start-ups are increasingly integrating artificial intelligence into their business models from the outset. So there is a big difference. Investors are also looking for technology-driven companies with a functionality that are based on AI.

– AI will affect all businesses in all industries. In particular, administrative processes will change. Therefore, all small businesses must step up by letting go of old models, learning about AI and embracing this new technology. Otherwise, many will be out of business. The impact of artificial intelligence on small businesses in ten years’ time is unknown.

What are the main benefits of AI for small businesses?

– More cost-effective processes without having to invest. The areas of application span everything that produces text and “thinks”. What we normally think of as problem solving or intellectual work will be affected. The effects are difficult to assess.

How will technology affect entrepreneurs’ creativity and innovation?

– The key is to work with AI and see it as a partner in your development. It helps to solve problems – not only faster, but also differently.

What risks can artificial intelligence pose for small businesses and startups?

– One risk with AI is that the pace of technological development is so fast that it becomes difficult to understand how to use it. We can also become overconfident in what technology can deliver and automate. This can lead to wrong decisions, which in turn can involve any number of risks. With AI, we need to be on our toes all the time.

– It will be a big adjustment to find the right approach to technology. I mean that humans and algorithms will be intermingled – we will have colleagues who are not human beings.

– We should also keep in mind that tools like ChatGPT save everything we share in their database. So companies have to be careful about posting corporate strategies, proprietary technologies and other information they want to keep secret. ChatGPT answers based on the content of its database, which may involve the dissemination of trade secrets. If you don’t want the uploaded information to be saved in the database, you can easily disable the feature, which requires a cheap subscription that costs about $30 per month.

What kind of AI skills do entrepreneurs and small businesses need to acquire in order to remain relevant and not lose competitive advantage?

– For small businesses, the most important thing now is to test the technology, be curious, creative and proactive. There is a lot of free support on this topic, for example on Youtube and in various guides on the Internet. So the threshold is low.