Generative AI, a groundbreaking paradigm shift in technology, is poised to trigger a significant transformation in enterprise expenditures over the next decade. While the initial focus has been on infrastructure, with capital pouring into companies like Nvidia and GPU aggregators, the real impact is expected at the application layer. This shift is reminiscent of previous transitions from "system of record" to "system of engagement" applications, marking a move towards consumer-like experiences and collaborative tools.

As generative AI shapes the next generation of applications, we're witnessing a two-fold evolution. The first wave involves lightweight tools like ChatGPT integrators, offering immediate but fleeting value. The second wave is emerging, leveraging generative models to integrate structured data from system-of-record applications and unstructured data from system-of-engagement applications. The challenge for developers is to "own" the layer above these existing applications.

Looking ahead, the third wave envisions the creation of a defensible "system of intelligence" layer. Startups are expected to introduce novel offerings that harness existing capabilities and build out workflows, ultimately creating a new class of "super datasets." These system-of-intelligence products will have deep integrations, sophisticated data characterization, and data feedback loops, providing enduring value in a rapidly evolving AI landscape. The race is on for founders to build products that couple generative AI with high-value workflows, collaboration, and the introduction of super datasets, ensuring an extraordinary impact on enterprises.