#004 Have I Mentioned the Word Context Yet?

🧠 Last week I told you AI is a prediction machine. But here's what I didn't tell you: even the smartest prediction machine in the world is useless if you don't give it the right information to work with.

It's like asking a friend for directions to "that one place with the really good food."

They might be able to guess… but you're probably not getting where you want to go.

Today, we're starting our dive into the single most important concept to transform your AI results, one you must constantly remember: context.

But first, a few things:

I’m doing something I haven’t done yet. I'm breaking one topic into three newsletters.

Why? This is so important that I can’t fit everything you need to deeply understand into one newsletter.

I'm not exaggerating. Nearly every AI win (or fail) I've seen can be attributed to the context involved. Miss this, and you'll struggle with any AI tool you touch. Get this right, and I promise you will find incredible use cases.

Here's how I'm breaking it down:

Three weeks, guaranteed wins by the end.

The entire purpose of this newsletter is to get you using AI regularly. After all, how will you be able to leverage AI if you’re not using it? Take action by scheduling 10 minutes of daily AI use in your day.

Don’t overthink, just type (or speak! more on voice in a later newsletter). Observe how it responds, what does it get right? What does it get wrong? Ask it to teach you about something you’re interested in lately. Ask it to help you understand a concept that you’re struggling with. It doesn’t matter how you’re using it, just use it!

I promise, I know this is hard.

No matter how hard it might seem, you’re capable of learning how to leverage AI. Take this written call to action seriously and commit to 10 minutes of daily experimentation…

Then just do it.

Quick reminder: These Foundation editions build on each other. If you have missed previous newsletters, catch up [here]

And please, share the newsletter! If it’s interesting and helpful to you, it will be to your friends and network.

Finally, let’s get started!

In short, context is everything that surrounds your request when you're talking to AI. Context is the background information, circumstances, and specific details that give meaning to your request. It's who you are, what you're trying to accomplish, who you're speaking to, and any relevant constraints or goals you have.

When you give AI context, you're setting the stage for success. Instead of getting generic, cookie-cutter responses that sound like everyone else online (also known as AI SLOP 🤪 always, ALWAYS avoid AI slop), you get tailored solutions that actually fit your needs. Context turns AI from a fancy search engine into your personal business strategist who actually understands what you're trying to build.

Conceptually, context is fairly straightforward, but the mastery of it is quite difficult. My next two newsletter editions will focus on how to best provide and use context. To do that, you first need to understand its limitations.

Here's the simplest way I’ve seen context limitations in AI explained:

Imagine you're writing on a single piece of paper. 📜 No matter how small you write, eventually you'll run out of space. When that happens, you have to start on a new sheet if you want to keep writing.

AI works exactly the same way.

Every conversation with ChatGPT (or any AI) has a "context window". Think of it as that one sheet of paper. Everything you say or provide (inputs) as well as what the AI says (outputs) fills up space on that sheet.

Here's the part most people struggle to grasp: Once that sheet is full, AI literally forgets the beginning of your conversation.

I must admit this took me far too long to comprehend, I spent so much time building up context in my chat then watched it seemingly forget crucial details I had previously provided. Frustrating? Absolutely.

But now I know better.

Because this impacts how you use AI, it’s that simple.

This limitation has improved greatly over the last 8 months with newly released models.

For example, ChatGPT-5 was recently released. This is their newest model. With it, OpenAI announced a new 400,000 context window limit (was previously 200,000).

To help illustrate this, a 400,000 context window is roughly the size of a full novel. Think 'The Great Gatsby' or about 300-400 pages of a typical paperback. You'd have to paste in entire business books before hitting the limit.

That’s a LOT of text to work with.

Here's what matters: both your input AND the AI's output count toward that limit.

The longer your conversation, the closer you get to filling up that "sheet of paper”.

Also, something I want you to always remember:

This is not an exact science. This is an evolving playing field with imperfections, inconsistencies, and nuance. There is no “perfect prompt” that will yield the best possible results. The “perfect prompt” will be different for everyone according to their unique needs and circumstances, and will change as these models continue to improve. The same concept applies to context windows. The 400,000 window is not exact, performance may suffer even within the context window.

This is why understanding the fundamentals is so crucial to your AI success. It’s very much an iterative process, and you must be in the drivers seat.

By this point, you’re likely feeling overwhelmed. Don’t! This takes time to process, this takes time to comprehend. Give yourself time to learn this. Do not allow the inherent complexity of this new technology to stop you from learning it, and more importantly, leveraging it in your business.

Learning AI is a continual process full of mistakes and errors. That is how you learn. You must iterate.

I used to ask this question constantly: "When should I start a new chat?"

Here are some simple rules I tend to follow.

Start a new chat when:

Think of it like cleaning your workspace before starting a new project. Fresh space, better results.

In week 3, we’ll cover how to retain context throughout various chats so you’re not starting from scratch every time!

Keep building, never give up. You go this!

Cam

Quote of the Week:

“People say you should be kind to yourself, but so many people should be way, way harder on themselves...and raise their standards.” - Dr. Julie Garner (one of my favorite X follows, you can find her here)