- Boring Business Nerd
- Posts
- AI Startups: Faster, Cheaper, but Stickier?
AI Startups: Faster, Cheaper, but Stickier?
Today, the focus is on high growth, but retention will matter most tomorrow.
Kieran Ryan
February 27, 2025
In partnership with
TODAY’S STORY
AI is changing how Silicon Valley builds startups.
Notably, AI tools are boosting productivity, allowing teams to accomplish more with fewer people. Compared to previous startup cohorts, we're seeing higher ARR per employee and a growing wave of “tiny team” success stories.
For comparison, before the AI boom, Afore Capital's portfolio data from 200 startups showed they typically burned $1 million to generate $1 million in revenue. It now costs one-fifth as much and could drop to one-tenth soon.
Sam Altman has predicted that there could someday be a one-person startup worth $1 billion.
However, the big challenge remains—while AI apps are growing fast, they're also experiencing high churn.
When AI emerged, companies had discretionary funds to experiment with and test its potential use cases. That’s no longer the case.
AI customers tend to follow the latest technological advancements—i.e., switching from ChatGPT to Claude and from one vertical AI player to the next.
Today, the focus is on high growth, but retention will matter most tomorrow.
Meal Prep Slowing You Down? Not Anymore.
Huel Black Edition is your go-to for fast, complete nutrition.
With 40g of protein (more than 5 eggs) and 27 essential vitamins, it supports your immune system, heart, hair, bones, and digestion, it’s a breakfast that keeps you going. Best of all, it’s only $2.50 per serving and takes just 30 seconds to make – no cooking, no hassle.
Use code HUELBE15 for 15% off your first order, plus a FREE t-shirt and shaker.
#SHORTS
Analysts Are Wrong About Palantir
@boringbusinesskieran Analysts Are Wrong About Palantir 📈 #business #tech #ai #palantir #pltr #stockmarket
PREVIOUS STORIES
Investors rethink obesity bets — Several factors dampen investor appetite for the obesity trade.
Bird Flu Danger Growing in 2025 — Scientists say the risk of another pandemic is rising after examining mutations in H5N1 viruses.
The Tech Powering Trump’s Border Crackdown — Tech companies stand to profit significantly as long as the border remains a priority.
KPMG blurs the lines between accounting and law — The accounting firm is trying to get a more significant piece of the law marketplace.
Netflix’s stock gets price-target hikes — Netflix’s breakthrough in live events is expected to help them add to their global subscriber base.
To read the web version of previous stories, click here.
If you have any comments or feedback, just respond to this email.
Thanks for reading,
Kieran & Justin Ryan
