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If You Understand These 5 AI Terms, You’re Ahead of 90% of People

7 min readMar 29, 2026

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Let me be frank.

Most people who talk about AI either sound like they’re giving textual definitions, or they’re completely clueless when someone mentions terms like LLMs or neural networks.

You don’t have to be either of them.

I believe that there are these 5 terms, 5 concepts that, if you actually understand them (not just memorise), you’ll be miles ahead of almost everyone else in the room. Whether you’re in tech, business, education, or just someone curious about where the world is heading.

Let’s start.

1. Tokens

The very first thing that you must register in your brain is that AI models don’t read words. They don’t even read letters. They read tokens.

So what’s a token?

Imagine you’re reading a book, but instead of reading all the words, you’re reading chunks of words. Sometimes a chunk is a complete word like “cat.” Sometimes it’s part of a word like “un” or “tion.” Sometimes it’s punctuation. That piece of text (chunk) is a token.

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Shreyas Naphad
Shreyas Naphad

Written by Shreyas Naphad

I’m an AI Engineer and content writer who loves storytelling. I write about AI, ML, tech, and productivity. I’m always keen to write stories worth reading.

Towards AI
Towards AI

Published in Towards AI

We train AI Engineers. We deploy Enterprise AI. Join 100K+ AI practitioners at Towards AI Academy or reach out for help making your company AI native. towardsai.com