RIP to ChatGPTâs easiest victim⦠[The Jolt with Stephen McBride] Taken to the AI slaughterhouse RIP to ChatGPTâs easiest victim. It was inevitable. Iâm talking about Chegg (CHGG). Chegg offers subscription-based online tutoring and textbook rentals. It was a thriving business. From 2016 to 2022, the company grew subscribers from 1.5 million to 8.2 million. But then ChatGPT, the popular AI chatbot, showed up like the grim reaper. Suddenly, everyone had access to their own interactive AI that could function in many ways like a private tutor⦠for free. Overnight, Cheggâs business model became obsolete. I first warned about this [last May](. The stockâs fallen 70% since. - And things got worse yesterday, when Chegg plummeted 28%: It was an ugly earnings release. The CEOâs out. Revenue, gross margins, profits all fell.  Bottom line: students are choosing free AI tools like ChatGPT instead of Cheggâs paid tools. As you can see, Chegg has been bleeding subscribers since ChatGPTâs debut: Source: Yahoo Finance And Cheggâs not the only education company getting disrupted by AI... Coursera (COUR), another online course provider, tumbled 14% to an all-time low after releasing weaker-than-expected results. Donât try and âbottom fishâ for bargains in these AI disruptees. This isnât a temporary setback. - Weâre witnessing the early stages of a permanent shift that will forever disrupt education. Iâve been banging the drum on why education needs to be disrupted for years. My daughterâs schooling is basically the same as mine was⦠which isnât all that different from what my motherâs was. What other industry has stood still for 50 years? Airlines maybe. Weâre still packing 30 kids into a stuffy classroom and lecturing them for an hour. I discussed this with AI expert Zvi Mowshowitz recently. He agreed AI can transform learning, saying: âAI is a total game-changer for education. My kid says to me, âDad, can we ask the box (ChatGPT) that knows everything?ââ The box that knows everything⦠thatâs the best description of AI chatbots Iâve heard. Yes, I know AI can also spread false or ideologically motivated information. Weâll have to be careful not to let it propagandize our kids. [ShareÂ]( But thatâs a solvable issue. Donât let it distract you from where this is all going. How am I so sure AI will forever disrupt learning? Because one-on-one tutoring is the holy grail of learning. In 1984, MIT professor Benjamin Bloom showed that students receiving personalized tutoring achieve much better grades. With just a few weeks of individual lessons, a group of average students outperformed 98% of others in the class. The results have been recreated many times since. No one doubts that kids do far better with one-on-one guidance that fits their needs, as opposed to one-size-fits-all teaching. But it was impossible to give every kid his own teacher⦠until now. - For the first time, AI can give every student their own expert super-teacher Synthesis is a new AI learning tool. It looks incredible. [Go check the videos out](. I canât wait to try it with my kids. Source: Synthesis Khan Academy built robo-tutor Khanmigo in collaboration with ChatGPT. Khanmigo is a like a teacher with infinite time, patience, and expertise to individually teach each kid. Take a student who struggles figuring out a math problem that the rest of the class has grasped. Instead of being left behind, heâll ask Khanmigo for help. Khanmigo patiently guides him to the correct answer in the same way a teacher would, but canât, because the teacher has 19 other kids to worry about. Think about how game changing this is. AI tools like Khanmigo lets every student learn at their own pace. Maybe your kid breezes through math but needs some extra attention in Spanish. Thereâs now an AI for that. If you explore these tools, keep in mind the golden rule of disruption: this is the worst theyâll ever be. Right now, theyâre a little like dial-up internet in the '90s. Aspects will be frustrating. Thatâs okay. Through experimentation and innovation, theyâll get better fast. AI is going to steamroll education and build it back better. What a time to be a parent. - AI is unlike any other disruption Iâve invested in... The profits will be good, when you own the right stocks. But even greater gains will come from using AI. Iâd trade my Nvidia (NVDA) profits for my daughter becoming a straight-A student all day. AI can already teach middle and high school kids. How long before it can take you through an entire four-year degree⦠for free or close to it? Itâs coming. And if anything needs disruption, itâs college with its skyrocketing costs and descent into ideology. If I could short college, I would. For now, the best âhedgeâ against this disruption is mastering AI tools so we can give our kids (and grandkids) a leg up. Stephen McBride
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