OpenAI's Product Lead warns AI startups: how to avoid being a demo

View profile for Rubén Domínguez Ibar

investing, writing, building

OpenAI’s Product Lead has a blunt warning: most AI startups aren’t companies, they’re expensive demos 😬 Chegg waited too long and lost 90 percent of its value. Jasper raised at a $1.2B valuation but collapsed when costs outpaced revenue. Duolingo bolted on AI the wrong way and lost user trust overnight. AI is unforgiving. Features get copied in weeks. Costs scale faster than revenue. The market does not give second chances. Miqdad Jaffer, Product Lead at OpenAI, lays out the playbook for founders who want to survive: ▪️ Moats come from data, distribution, and trust ▪️ Pricing is strategy, not an afterthought ▪️ Every feature must scale economically ▪️ Differentiation has to go deeper than “adding AI” 📖 I am sharing the full guide and frameworks here: https://lnkd.in/exXTNhdR AI Resources you might find helpful: • OpenAI’s New Playbook for Product-Market Fit in AI Startups https://lnkd.in/dy-HgVtX • 2,500+ Angel Investors Backing AI Startups - https://lnkd.in/djjN-TD2 • 50 AI Agent Startup Ideas for 2025 - https://lnkd.in/dy9E-MCn • AI Co-Pilots for Startups & VCs - https://lnkd.in/dSX3ss2q • The Agentic Revolution - https://lnkd.in/dadFm25a • 118 AI Communication Agent Use Cases - https://lnkd.in/dr9cM5BT

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Dempsey D.

CEO & Founder 😈 | (US C-Corp) 🌎 | Cross-Border Entrepreneur | Private VC & Seed-Stage | AI EdTech 💖 | R&D Tech Venture - fully remote 🎢🔥😄

2mo

All the AI only startups just need to serve a real industry and build deep... xD 😄

Rolfe William Swinton

Turn proprietary data into revenue, growth & moats. Delivered 40% EBITDA and 100% YoY growth. Built $50M ARR from data assets and $1Bn in enterprise value; repeat the model with your assets.

2mo

The first bullet is so key "Moats come from data, distribution, and trust" I would underline the data in that - but those three things are so key. And those together should drive differentiation. Helpful checklist! A real touchstone for all entrepreneurs in this space!

Raj P.

Architect, Entrepreneur, Problem-solver

2mo

I think what is said is right but also 90% applies to OpenAi demos too ;)

James A.

Proven Executive Helping Organizations Reach The Highest Levels of Growth, Revenue & Opportunity

2mo

Just like the dot.com boom, race to the bottom boys, much of the AI space is just filled with a bunch of hype and nothing sandwiches

Mathew Stastny

Product & Innovation Leader + Entrepreneur = Making the world a better place

2mo

I have got a deja vu… let me jump on my DeLorean and travel back to 1999… No value creation = no business No matter how much tech you through at it

Sagar Agrawal

Founder at Qubit Capital | Entrepreneur | Family Person & A New Father | Helping Startups Raise Funds Globally

2mo

Building with AI requires more than just features. Loved the focus on data, distribution, and trust as true differentiators.

David Wegner

Managing Partner @ KB53 Funds | Founder & CEO @ FOUNDRA. Challenging the current F(o)unding System | Enabling faster, simpler and more value aligned Deal Flow

2mo

Rubén thanks for sharing. We are still early.

Manoj Hujband

Execution Enabler 🚀 | Helping Hustlers & Entrepreneurs Turn Ideas into Scalable Businesses | Project Lead @ Mphasis | Tech + Systems Builder

2mo

It's wonderful article, very much eye opener.

Hr Dr. Takahisa Karita

Top Entrepreneurs Setting New Standards in Their Industry in 2025 by USA Today. Top 10 Entrepreneurs Setting New Standards for Success in 2025 by MSN. Top 10 Business Leaders to Watch in 2023 by the IBT. IP Licensing

2mo

Insightful

Distribution and trust is key, AI should be the add on not the main thing.

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