From “I use AI in chat” to “I built something with AI.” A practical road map for real beginners.
AI for DummiesModule 818 slides
You already know the pieces — prompts, the API, real-world examples. This lesson is where they connect into something you actually ship.
Covers: cloud vs local decision · 4 starter projects · what RAG is · the 3-layer app model · Claude Code scaffolding · 4 golden rules
Lesson 08 · Slide 2
Decision #1 — Cloud or local?
Four quadrants: Privacy sensitivity (vertical) × Expected volume (horizontal).
The interactive wizard on the Theory page scores your situation across 5 dimensions and gives a personalised recommendation.
Lesson 08 · Slide 3
Cloud option — deep dive
Pros ✓
Best output quality available today
No hardware requirement — a Chromebook works fine
Ready in minutes (get an API key, write 5 lines)
Provider handles model updates, scaling, uptime
Multimodal: text, images, code all in one call
Watch out for ⚠
Sensitive data leaves your machine
Pay per token — loops can surprise you
Internet required at runtime
Provider could change pricing or terms
Rate limits on free / cheap tiers
Tools:Anthropic Claude APIOpenAI ChatGPT APIGoogle Gemini API Start with a cheap/fast model (Claude Haiku, GPT-4o Mini) for dev. Upgrade only when you need it.
Lesson 08 · Slide 4
Local option — deep dive
Pros ✓
Zero cost per call after installation
Data never leaves your machine — fully private
Works offline — no internet needed at runtime
No rate limits, no usage caps
Same OpenAI-compatible API — easy to switch
Watch out for ⚠
Needs 16 GB+ RAM; 32 GB ideal
Slower than cloud on modest hardware
You manage model downloads and updates
Quality gap vs. top cloud models (shrinking)
Initial setup takes 20–40 minutes
Tools:Ollama (terminal-friendly, great API)
LM Studio (graphical app, no CLI needed)
Apple Silicon Macs are excellent for local models. NVIDIA GPU also works well.
Lesson 08 · Slide 5
“Prototype cloud, scale local” — the smart arc
Start fast with cloud quality. Swap to local when cost or privacy become real concerns. One line of code changes.
The magic switch: change base_url from https://api.openai.com/v1 to http://localhost:11434/v1 and the rest of your code is unchanged.
Lesson 08 · Slide 6
Starter project #1 — PDF Summariser
Loop through a folder of PDFs, send each one to the model, write summaries to a text file. Perfect first project.
📁folder/ *.pdf
→
🤖AI reads & summarises
→
📄summaries .txt
import anthropic, pathlib
client = anthropic.Anthropic() # reads ANTHROPIC_API_KEY from env
for pdf_path in pathlib.Path("reports/").glob("*.pdf"):
text = extract_text(pdf_path) # PyMuPDF or pdfplumber
response = client.messages.create(
model="claude-haiku-4-5",
max_tokens=300,
messages=[{"role": "user", "content":
f"Summarise in 3 bullet points:\n\n{text[:3000]}"}]
)
print(f"=== {pdf_path.name} ===")
print(response.content[0].text)
Time estimate: 2–4 hours · Difficulty: ★★☆ · Needs: Python, anthropic, pdfplumber or PyMuPDF
Lesson 08 · Slide 7
Starter project #2 — Message Sorter
Classify incoming emails or support tickets into categories. The AI returns a label — you route accordingly.
The classification prompt
Ask the model to return a single JSON object with a category field. Easier to parse than free text, and much more reliable.
Works on emails, tickets, social DMs, chat logs — anything text
Add "confidence": "low" to flag uncertain cases for human review
Test on 20 real examples before automating anything
Lesson 08 · Slide 8
Starter project #3 — Personal Q&A Bot
Point an AI at a folder of your own notes or docs. Ask it questions. It answers from your material.
📄📄Your notes, PDFs, wiki
→
🔍RAG search (find snippets)
→
🤖AI reads & answers
→
💬Grounded answer
No-code path (30 min)
AnythingLLM: free desktop app, point at a folder, get a chat interface. Works with Ollama (local, private) or Claude API (cloud). No Python needed.
Code path (1–2 days)
Python + LangChain or LlamaIndex: split docs into chunks, embed them, store in a vector DB (Chroma, FAISS), search on each question, pass snippets to Claude. Full control.
Key insight: AnythingLLM is the right first step. Build a custom RAG pipeline only after you've confirmed the approach solves your problem.
Lesson 08 · Slide 9
Starter project #4 — Auto-Reply Drafter
Draft replies to common inbound questions in your tone. Human reviews & hits send. Speed up support by 3×.
📧Incoming question
→
🤖AI drafts reply
→
👤Human reviews
→
✅Send reply
The prompt pattern
Use few-shot prompting: include 2–3 examples of real questions and your best past replies. The model learns your tone automatically. Add a final line: "Match the tone of the examples above."
Good categories to automate drafts for
Pricing / refund questions
"How do I reset my password?"
Feature availability questions
Shipping / delivery status
Never auto-send without human review for anything customer-facing.
Lesson 08 · Slide 10
What is RAG? — the core idea, simply
RAG = Retrieval-Augmented Generation.
The model can only see what's in the prompt. RAG is how you get your private documents into the prompt automatically, at the moment they're needed.
Without RAG
The model knows only its training data (frozen at cutoff). It has never seen your company wiki, personal notes, or product docs. If you ask about them, it guesses or says it doesn't know.
With RAG
A search step runs first, finds the most relevant chunks from your documents, and pastes them into the prompt as context. The model reads them like a cheat sheet and answers from material it can actually see.
Why not just paste everything? Most document collections are far too large to fit in a context window — and sending hundreds of pages with every query would be very expensive. RAG picks only what's relevant, typically just a few hundred words.
Lesson 08 · Slide 11
RAG flow — 5 stages (animated)
Watch the 5 stages appear in sequence. Each is explained below the diagram.
The animated RAG diagram on the Theory page has hover tooltips explaining each stage in detail.
Lesson 08 · Slide 12
“Chat with your own docs” — tools that handle RAG for you
You don't need to build the search engine. These tools do the whole RAG pipeline with a GUI.
🏠 AnythingLLM (recommended first step)
Free desktop app for Mac, Windows, Linux. Point it at a folder of PDFs or notes. Gives you a chat interface over them instantly. Works with Ollama (local & private) or Claude/OpenAI API (cloud). Zero coding.
🔗 OpenWebUI
Web-based chat front-end for Ollama with built-in document RAG. Run it locally via Docker. Great for teams who want a ChatGPT-like experience over private models.
🏴 Flowise / LangFlow
Visual drag-and-drop pipeline builders. Connect nodes: “load PDF” → “split text” → “embed” → “store” → “chat”. Good once you need custom logic beyond the defaults.
🛠 Build your own (code path)
LangChain or LlamaIndex in Python. Full control. Use a vector store (Chroma, FAISS). Embed with OpenAI or a local sentence-transformer. 100–200 lines of code to get started.
Lesson 08 · Slide 13
The 3-layer app architecture
Every AI application, from a weekend script to a shipped product, is made of the same three layers.
Beginner tip: your first project is probably just Layer 2 alone — a Python script with no web page, reading from a hardcoded string. That is completely fine. Build Layer 1 only when the core logic works reliably.
Lesson 08 · Slide 14
Claude Code can scaffold this for you
Describe the app you want in plain English. The agent builds the boilerplate, wires the API calls, and sets up the folder structure. You steer and review.
What you type
Build a Python script that:
1. Reads every .txt file in ./emails/
2. Classifies each as billing,
support, or spam
3. Outputs a CSV: filename, category,
confidence
4. Uses Claude Haiku, reads ANTHROPIC_API_KEY
from env
What Claude Code does
Creates project folder & requirements.txt
Writes the main script with a classification loop
Adds JSON output parsing + error handling
Writes a .env.example for the API key
Adds a README.md with run instructions
Always: review every file it creates before running. Work inside a git repo so you can undo anything. Test on a small sample before pointing it at real data.
Lesson 08 · Slide 15
Golden Rules #1 & #2
👤 Rule #1 — Keep a human in the loop
Anything that touches money, health, law, or goes to real customers needs a person reviewing the output before it acts.
Run manually for at least 20–50 examples. Understand the failure modes. Only automate fully once you accept the cost of a bad output slipping through.
AI draft→👤 review→✓ send
❓ Rule #2 — Never trust output blindly
Validate AI output — especially numbers, facts, and code. The model sounds equally confident whether it is right or completely wrong.
✘ Don't
Copy-paste output directly
Trust numbers at face value
Ship AI-written code unread
✔ Do
Check facts against a source
Run code on test data first
Ask AI to show its reasoning
Lesson 08 · Slide 16
Golden Rules #3 & #4
🔒 Rule #3 — Protect keys & data
An exposed API key is a stolen credit card. Keys can rack up large charges in minutes if found by a bot scanning GitHub.
✘ Never do
Key in code
Key in a chat prompt
Commit .env to git
✔ Always do
Key in .env file
.env in .gitignore
Read via os.environ
Sensitive data (medical, legal, personal)? Use a local model so nothing leaves your machine.
🔍 Rule #4 — Start cheap, measure, scale
Confirm the core logic works on 10 examples before running it on 10,000. Cloud APIs bill per token — a loop with a bug can cost surprisingly fast.
Dev: cheap model, 10 examples~$0.001
Test: mid model, 100 examples~$0.05
Production: top model, 100k/day~$50+/day
Set a spending cap in your API dashboard from day one. Most providers offer this.
Lesson 08 · Slide 17
A first-weekend project plan
The “Meeting Notes → Action Items” project. Completable in 90 minutes with a free Claude account and a text editor.
1
Write sample input. Paste 5 minutes of meeting notes (real or invented) into a text file. Example: “Alice to send the budget by Friday. Bob will review the designs by EOD Thursday…”
2
Get the prompt right in chat first (30 min). Open Claude.ai. Paste your notes. Prompt: “Extract every action item as a JSON list with fields: owner, task, due_date.” Iterate until reliable.
3
Wrap in a Python script (45 min). Read the notes file. Call the Claude API with the working prompt. Print the JSON. Done — that's a real AI tool.
4
Test on 5 real meetings. Check every output manually. Where does it go wrong? Fix the prompt. Add handling for empty input or missing fields.
5
Optional: add a CSV output. Write the action items to actions.csv so you can open it in a spreadsheet. Now it's actually useful for your team.
The lesson: every project after this is faster because you know the rhythm — prompt in chat, wrap in code, test with real data, iterate.
Lesson 08 · Slide 18
Recap & next: Safety
What we covered
Cloud vs local decision matrix — 4 quadrants
Cloud & local deep-dives — pros, cons, tools
4 starter projects with flow diagrams
RAG explained + animated 5-stage flow
The 3-layer app architecture
Claude Code for scaffolding
4 golden rules + verification flows
A concrete first-weekend project plan
Lesson 09 — Safety preview
Hallucinations: why they happen, how to catch them
Privacy: what data leaves your machine and when
Bias: what it means & why it matters
Cost: spending caps, token budgets
Agents & the leash: safe limits for agentic tools
AI is not a professional: law, medicine, finance
Your homework: pick one project from slides 6–9. Spend 30 minutes getting the prompt right in Claude.ai. The homework page has three guided exercises to help you ship your first real AI tool.