Do "AI" companies have any real competitive advantage?

Question

I'm really curious to hear your thoughts here.

As a product person and an investor I've been very skeptical about all the "AI" companies launching in last year.

Not talking about the OpenAI, Antrophic, etc. of the world. They'll do great.

Talking about all the AI-powered companies that in my eyes are nothing more than a nice UI layer on top of OpenAI.

They have really cool products... but anyone with a no-code editor could reproduce them in a week.

How will they survive in the long term? Competition in every niche seems to be through the roof and the only real differentiation I see in the space is through UI/UX or Go To Market... but is it enough to build a solid business?

Massimo Chieruzzi · Accepted Answer

@divyeshgohil I hope for them that's how it's gonna play out :)

Focus on customers for sure is critical and I agree they're solving real customers' problems.

I'm just missing the differentiation part :) Played with a lot of content writing tools from Jasper to all the others ... they are all the same in terms of output... just slight differences based on a bit of prompt engineering in my opinion :)

Massimo Chieruzzi · Answer

@millisen Interesting point of view! I agree on the last part. On the performance of the AI product... since most tools use the same 2 LLMs in the background, aren't performances very comparable?

Divyesh Gohil · Answer

Yeah same here @massimocw .

I understand your concerns about the many new "AI" companies appearing lately. While some seem to just use existing AI technology with a fancy interface, their value lies in helping their customers. These companies focus on solving specific problems for their users. To succeed long-term, they need to stand out from the competition with things like better design, smart marketing, and good customer service. Even though competition is tough, companies that really know their customers and keep improving are likely to do well!

Gurkaran Singh · Answer

Hey there!

As someone deeply immersed in the tech world, including startups and agency life, I can definitely understand your skepticism about the plethora of "AI" companies popping up left and right. It's easy to get inundated with buzzwords and flashy interfaces that may not necessarily have a substantial foundation.

While UI/UX and Go-To-Market strategies are crucial, especially in a competitive landscape, I believe that true innovation and a solid business model will always stand the test of time. In the realm of AI, companies that can truly harness the power of data science and embedded programming to create unique solutions will have a leg up.

It's all about finding that sweet spot between technology and practical application. As someone who's tinkered with various tech domains, I'm sure you can appreciate the value of genuine innovation over just a shiny surface.

Keep questioning, keep exploring, and don't be afraid to dive deep into the circuits of these "AI" companies to uncover what truly sets them apart. After all, the real magic often lies beneath the surface.

Elle Gzirishvili · Answer

I think AI powered businesses only work if they have a very sophisticated and specific prompting system. some companies often use specifically trained AI models which operate for the niche need of the company and a user. Also prompting is not an easy task and not everyone knows how to properly do it to get the exact result the user is looing for. for example the company where I work, Biliki AI, is AI powered web app. the tours generated on our website is curated to be sustainable and encourage travelers to be more responsible. but at the same time we offer other different thing like links to accommodations thanks to our partner booking.com and which are specifically chosen with the eco-friendly badge. of course if someone is willing enough they can go to OpenAI and do everything by themselves, but the service we offer for the travelers to save time and make travel planning quick and easy.

Aleksander Frankowicz · Answer

Also, it's harder for startups that are actually doing their AI to stand out from this crowd, because many investors don't know how to verify whether the model is real or just an overlay, so they're necessarily suspicious.

But if you look at it from the perspective of the overlay companies, it does make sense.  They can get a really quick MVP, and get to know the market before they have to put a lot of money into a product and a team. That's quite an advantage.

Answer

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Answer

Yes, AI companies can have a real competitive advantage through superior algorithms, access to vast data sets, faster decision-making, and the ability to continuously improve their models.

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definitely yes, because AI allows to improve the service, if you set up everything qualitatively, it allows the project to grow. For example, we also use AI in our Arbonum payment system, and it helps us to determine that an employer is trying to hide an employment relationship under the guise of working with a freelancer, as well as to detect strange patterns of user behavior in order to disarm the payment system and eliminate errors in generating reports.

Do "AI" companies have any real competitive advantage?

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