This advice can save your business

Do not index

2024 is the year of AI products.

And all of this is happening for obvious reasons.

VCs are throwing money

AI is everywhere

And honestly, it does feel like magic

But amidst all of this chaos — we are forgetting 1 thing.

99% of AI companies are coming crashing down. If they haven’t already, in the next 1 year.

And this happens for one of these 3 reasons:

The AI model you built on top of is outdated

The product is launched as a feature elsewhere

It’s a ‘winner takes all’ market and you get left behind.

But where is this coming from?

Late last year - I acquired typeframes.com - it was positioned as an AI product video software. Good, but the growth wasn’t evident.

This led to me forking Typeframes and building revid.ai on top — which is an AI-based viral video creator.

And a few months later, we hit $200,000 ARR with Revid.ai

As I reflect on Revid’s growth, here are some things you should do to make better, and more sustainable AI products:

1. Leaving room to plug in the latest AI models

Some of the recent spikes in the business occurred due to us plugging in a better AI model.

This means way better videos are generated.

But a lot of people I meet do not leave that room in the code and the product is quickly outdated. (sometimes even before launch).

Don’t do that.

AI excellence is a moving goalpost. By the time you get there—the goalpost has moved ahead.

Good reminder: Build with the AI quality of tomorrow, NOT from what it can do today.

2. Have a non-AI core feature

Here’s the thing: you can’t build your own AI models. You have to rely on GPT, Claude, DALLe, and other base models to operate.

The biggest risk this presents is that if you become big enough, the company will have a very good incentive to build your product as an in-built feature. And you won’t be able to stop it.

The solution? having a non-AI core feature.

For Revid - it’s a powerful video editor coupled with a huge database of Viral TikTok videos used as a training dataset.

This doesn’t require AI and is a very important part of the software. This helps me hedge my product against the AI risk and leave the opportunity for an exit later.

It’s an idea I’ve used for many years now. First in Tweet Hunter, then Taplio. And now, in revid.ai.

3. Be different, not better

If you are building a design tool on top of AI — do you really think you can compete with Canva?

If you are building a landing page creation tool — do you really think you can compete with Carrd?

Don’t get me wrong - I believe in you 100%

But the chances of you displacing the winner here are grim.

Compare that to writing software. Everybody has their favorite pick, some of them you haven’t even heard of. Yes, Notion is quite big but it isn’t everything.

When you look closely, you notice a very interesting pattern:

The software that competes is positioned differently than the leader.

The software that dies is positioned exactly like the leader. But better.

And you can’t compete with giants by being better.

If you try to build a better product — you lose.

If you try to build a different product — you win.

A great example of this is feather.so:

I can’t be better than WordPress or Ghost at their own game. But Feather is the best at the “Notion to blog” use-case.

TLDR for my lazy readers:
1 - Leave room for AI growth
2 - Build a non AI core features
3 - Be different, not better

Every new milestone that and my team unlock - we have a very special set of learnings.

Every week, I try to share these insights with you all.

I’d truly appreciate it if you share what you feel about this newsletter on Twitter. Tag me @tibo_maker and I will surely read it :))

Looking forward to your messages 🙏🙏

Next week: we will talk about my other product, feather.so and how I thought Notion killed it, but instead we grew 50% in revenue.

Stay tuned!

Tweet of the week

Great insights here! If I had a big team, I would like it to work like this:

That’s it for this week!

Forward this email to a friend who needs to read this 🚀

And if you are that awesome friend - Subscribe here to get weekly emails on Tech, Creator Economy, and Building a Business.

Hit reply and let me know what you found most helpful this week—I’d love to hear from you!

See you next Thursday!

Keep building

Tibo 💻