Why 99% of AI Startups Will Die

The Growth Insight 🌱

Why 99% of AI Startups Will Die

We're drunk on AI hype. VCs are throwing money around like confetti, founders are slapping "AI-powered" on everything, and everyone thinks they're building the next big thing.

But here's the sobering reality: Most AI companies are walking dead. They just don't know it yet.

The Horsemen of AI Startup Death:

1. Your AI model becomes yesterday's news (happens faster than you think)

2. The big players copy your feature (goodbye, business)

3. You end up in a "winner takes all" market (spoiler: you're not the winner)

4. You do not build for the active sub-market: Your Power Users

But Here's How to Actually Build Something That Lasts:

1. Plan for Tomorrow's AI, Not Today's 

Think of AI like an Olympic sport where the qualifying score keeps getting higher. That "cutting-edge" model you're using? It's already aging. Build your architecture assuming everything will be 10x better in six months. Because it will be.

2. Have Non Core AI Features Too

Here's the brutal truth: You can't compete on AI alone. OpenAI, Anthropic, and Google have more PhDs than you have employees. You need something they can't easily copy.

Build a non-AI core that's crucial to your product. Even if better AI comes along, our users stay for these features.

3. Different Beats Better Every Time 

Want to build an AI design tool? Canva will crush you. AI writing tool? OpenAI probably has it on their roadmap.

The secret isn't to be better – it's to be different. Find the weird, specific niche that the giants are too big to care about. Like Feather: They're not trying to beat WordPress; they're owning the "Notion to blog" space.

4. Build for Power Users First Here's a counterintuitive hack: Start with the hardest users to please. While everyone's building AI tools for beginners, I've found that power users are actually more forgiving of AI limitations if you solve their complex problems. They'll stick with you through the AI pains because they value the core problem you're solving.

Would you rather have 100,000 casual users who'll jump ship when Canva adds your feature, or 1,000 power users who depend on your tool for their business?

The Hard Truth 

Most founders are building AI companies like they're in 2023. But it's 2024, and the rules have changed. You can't just wrap AI around a product and expect magic. You need to build something that gets stronger as AI improves, not weaker.

Remember: The AI companies that survive won't win because of their AI. They'll win because they built something AI alone can't replicate.

Credits:This advice can save your business - Tibo

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