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Dippy, a startup hoping to break into the booming market for virtual companions



Dippy, a startup hoping to break into the booming market for virtual companions

OpenAI recently revealed a new AI that can work through hard problems by using

step-by-step reasoning. They believe this approach could be important for creating

smarter AI systems in the future.


While that's pretty advanced stuff, a simpler version of this technology might make

AI chatbots more fun and unpredictable. That's what a company called Dippy is

trying to do. Dippy offers "uncensored" AI companions - basically, AI characters

you can chat with that act like girlfriends or boyfriends.


Dippy just launched a new feature that lets users see the "thinking" behind their AI

characters' responses. The company uses its own language model, which they've

trained on role-play data. This supposedly makes it better at coming up with

responses when a user takes the conversation in an unexpected direction.

Akshat Jagga, Dippy's CEO, says that adding this extra layer of simulated

"thinking" can make the responses more interesting and surprising. "A lot of

people are using it," Jagga explains. "Usually, when you chat with an AI, it just

gives you a quick reaction."


Jagga also mentions that this new feature can show when an AI character is being

deceptive. Surprisingly, some users actually enjoy this as part of their role-play.

"It's interesting when you can actually read the character's inner thoughts," Jagga

says. "We have this character that is sweet on the outside, but manipulative on the

inside."


The article writer decided to try chatting with some of Dippy's default characters,

keeping the settings PG-rated (because otherwise they get way too flirty). The

"thought process" feature does add another layer to the conversation, but, the

dialogue still seemed pretty predictable. It was like something from a not-so-great

romance novel or over-the-top fan fiction.


One Dippy character, described as "Bully on the outside, warm on the inside,"

showed a softer side in its "thoughts" compared to its tough outer persona.

However, both the inner and outer dialogues lacked depth and kept repeating

similar ideas. For fun, he also tried asking several characters some basic math

problems. Their "thinking" sometimes showed how to break down the problem to

get the right answer.


Even though it has limitations, Dippy shows how popular and addictive AI

companions are becoming. Jagga and his co-founder, Angad Arneja, previously

created Wombo, a company that uses AI to make memes like singing photographs.

They left in 2023 to build an AI office tool, but after experimenting with different

personas for their assistant, they got really interested in AI companionship.

Without much advertising, Dippy has gained 500,000 monthly users and 50,000

daily active users. Jagga says people spend an average of an hour on the app at a

time. "That engagement was absolutely insane for us," he says.

Dippy also announced that it has received $2.1 million in early "pre-seed" funding

from investors, led by a company called Drive Capital.


Dippy is entering a market that already has well-known companies like

Character.AI and Replika, plus many other AI girlfriend apps. A recent report from

investment firm Andreessen Horowitz shows that many of the top 100 most-used


AI tools are AI companions. The report also reveals that people use these apps

much more frequently than almost anything else out there.

While these apps are often associated with young men who might not have great

social skills, they actually cater to women too. Jagga says that 70 percent of

Dippy's accounts tend to prefer male characters, which could mean that many users

are female.


Besides possibly changing how some people interact online, these AI companions

might have social effects we haven't fully considered yet. A few research studies

suggest that chatbots can help people feel less lonely. However, some experts warn

that heavy use of these apps might actually make people feel more isolated and

could reinforce harmful stereotypes.


"Some of these bots have dark patterns," says Iliana Depounti, a researcher at

Loughborough University in the UK who has studied how people use Replika,

another AI companion app. Depounti explains that these patterns often target the

emotional vulnerabilities of lonely people. She adds that Dippy seems to promote

themes and stories designed to appeal to young women in particular. "Some people

who use these apps are socially isolated, and these apps create further silos through

their emotionally validating algorithms that don't challenge existing conditions,"

she adds.


Instead of just looking inside the minds of AI companions, we might need to take a

closer look at how people are interacting with these apps to understand the real

benefits and risks.

What do you think about AI companions? Are they just harmless fun? A possible

solution for loneliness? Or something more concerning?


[AI-assisted tools were utilized in this article's research and drafting process.]

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