Grocery startup taps into AI to improve business practices

Global Business

Artificial Intelligence is drawing attention for its potential and its pitfalls. Tesla founder Elon Musk recently called for greater regulation of AI robotics due to its “public risk.”

CGTN’s Mark Niu reports from San Francisco about a startup using AI to better serve their business.

Going head to head with giants like AmazonFresh Grocery and big name supermarkets, Farmstead is a new Silicon Valley startup that deliveries groceries. From what it calls micro hubs, Farmstead tracks locally sourced products every step of the way as they’re delivered to homes in San Francisco within one hour of ordering. Farmstead’s secret recipe is AI.

“Artificial intelligence plays a massive role. We take into account all of our customers buying patterns to date. To help us predict exactly how much product to order for every particular item that we carry. We waste a lot less, and as a result we can pass those savings along to our customers,” Farmstead Co-founder & CEO Pradeep Elankumaran said.

Farmstead said traditional supermarkets waste about 35-40 percent of their perishable goods. But Farmstead uses the artificial intelligence-based algorithms to better predict and cut that waste down to only about 10 percent. And whatever is leftover is sent to food banks and shelters.

AI is branching out in seemingly every field, from being utilized as a virtual job recruiter at the startup Mya to being used by neurosurgeon Chris Mansi’s startup Viz for detecting strokes.

“So what you typically will do is have an expert radiologist for example train the algorithm by inputting different images that the expert has categorized and labeled. And each time the algorithm sees it, it will learn and change a little bit until it gets to the point it’s as good as the expert radiologist,” Viz Co-Founder & CEO Chris Mansi said.

But when scientist Stephen Hawking says AI’s emergence could be the “worst event in the history of our civilization” and Tesla’s Elon Musk calls it “summoning the demon” people get nervous.

Venture Capitalist Venky Ganesan has invested in a number of AI startups.

“Well, I do think AI will define the next war. So in that sense it’s legitimate for nation states to think about AI. But in general I believe knowledge is global and you can’t do anything,” Menlo Ventures Managing Director Venky Ganesan said.

“With artificial intelligence, we are talking about the capability to do many, many things including from our behavior what our preferences or where we’ve, been who we affiliate with and these things can be used for good or evil. I think it’s very hard to control the dark side of all these technologies,” Jerry Michalski from Futurist REX Think Tank said.

What some consider the dark side is the potential for AI to surpass human intelligence and replace jobs.

“I think it amplifies productivity. We have people here. We are AI-powered, and you still see a lot of people in our warehouse. And that will forever be the case. It is not meant as a replacement for a person. It’s meant to do things better than a pool of people could normally do while assisting them in doing their jobs better,” Farmstead Co-founder and CEO Pradeep Elankumaran said.

Farmstead also relies heavily on a network of contracted human drivers to deliver their food.

But some would argue that it won’t be too long before their jobs area challenged by AI-powered self-driving cars.