Jeffrey Katzenberg's unexpected take on AI – here's what he and Netomi CEO had to say

WndrCo co-founder Jeffrey Katzenberg's take on AI might not be what you expect. Katzenberg – who co-founded DreamWorks and previously served as chair of Disney (DIS) – joined Yahoo Finance to talk AI at Shoptalk 2023, a recent retail conference in Las Vegas.

"We looked at the opportunities around AI and are genuinely excited about it," he said. "You're hearing from the grand wizards of our world, like Bill Gates, the people who have really been pioneers over the last generation, and I think everybody agrees that this may actually be the next defining moment in our tech evolution – and with that comes incredible promise. The unbridled enthusiasm we're hearing about today is generative AI, and all of its applications around creativity, storytelling, and art."

"It really is quite spectacular," he continued, but with a kicker: "That's not what I'm interested in."

So, what is Katzenberg interested in? Puneet Mehta, founder and CEO of Netomi, an AI-focused customer service platform Katzenberg has a stake in, has the answer: a safer, more consumer-friendly version of AI called "sanctioned AI," which can only learn from text approved by the company the AI serves.

"What sanctioned AI means is that you get to leverage all the great things that generative AI brings to the table, but in a fail-safe environment," said Mehta. "So you need a safety net around it. You need to be clear about what role AI plays. Is it autopilot, where it helps customers autonomously? Or is it a co-pilot, where it's helping an employee?

He added: "You need brand safety filters, what it's allowed to say and not allowed to say. You need it to follow business policy and procedure. You need to be able to audit the work AI has done with relative ease. Then, you need escalation procedures where, if the AI does something wrong, you have somebody step in and save the moment gracefully... So, sanctioned AI lets you use all the amazing capabilities of generative AI, but for the enterprise in a fail-safe mechanism."

Katzenberg's WndrCo, an investment firm focused on long-term tech businesses, invested in Netomi in 2021, leading the company's $30 million Series B. Other extant investors who joined that round included Eldridge and Fin Venture Capital.

'AI is going to be the new customer interface'

For Katzenberg and Mehta, AI is about customer engagement, something that Katzenberg has spent decades thinking about.

"Through my entire career at Disney and DreamWorks, we were constantly involved with retail, with consumer products, and consumer engagements where, outside of the movie, the movie still lived on," said Katzenberg. "This is a world I love and I've always had great partnerships here."

For Mehta, who spent much of his career as a Wall Street tech executive focusing on AI before founding Netomi, AI has been the future of customer engagement for a while – so it's vital that that AI is managed thoughtfully.

"We invented the thesis that AI is going to be the new customer interface," said Mehta. "When a customer talks to a brand in any space, whether it's retail, whether it's travel, or whether it's banking, they would be greeted by an AI first. That's coming true now as we speak."

The best interactions between consumers and AI can and should be as good for the brand as a person-to-person interaction.

"I joke often that AI, in the context of customer service and customer experience isn't artificial intelligence, it's access and intimacy," said Mehta. "Could you provide access at those right touch-points when somebody really needs it? He added: The "intimacy is all about building that trust that the information they're receiving is accurate, and that feeling when you talk to a really great customer support agent that's watching out for you."

Currently, Netomi works with big names across a number of sectors, including HP (HPQ), Warner Brothers Discovery (WBD), WestJet, and Brex. Katzenberg believes that there are more to come.

"Today, if you're in the business of dealing with retail customers online or in-person in any fashion, shape, or or form, giving quality customer engagement is not only essential, it may be existential to your brand," he said. "Whether you're a travel company, retailer, or operating through e-commerce, every business today is relying more and more on this type of engagement."

Allie Garfinkle is a Senior Tech Reporter at Yahoo Finance. Follow her on Twitter at @agarfinks and on LinkedIn.

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