5 ms·

I'm tired of "AI" products wrapped over and selling at high rates

26 points by karanveer 2y ago

If you open product hunt or any directory for that matter, you will notice that things havent been quite innovative, except the root companies. Don't get me wrong, I'm not saying they are useless, but most of them are the same recipe cooked over and over and just presented in different way. Is this the norm now, a question from an amateur me to my fellow expert Hackers?

normanlawrence 2y ago
[dead]
fidla 2y ago
Yes
- karanveer 2y ago
  gg
kingkongjaffa 2y ago
Well hopefully you are not just keeping the same UX as chatGPT Because the value is in what the wrapper helps your specific customer base do. Whether that's through prompt engineering or RAG, or some other technique, the value is in someone else spending the time to think of a UX that helps accomplish a specific job. If you know what you want and how to do it, then likely fiddling around with prompts can get you pretty close, but people are busy and don't have time to test asking chatGPT 500 different prompts to get one that works well, or hunt around for examples to feed into context or into a RAG index. There's an asymmetry of information and effort developing the pipeline/context/prompt construction involved. And this is what add's value. Not simply a chat window and passing whatever the user types in, to openAI's API.
- karanveer 2y ago
  and im guessing you have an ai solution built yourself?
PaulHoule 2y ago
These are expensive because ChatGPT is expensive. If you really can’t tell the difference between competitors they must compete on price so they aren’t taking a fat slice of profits either. Even if they were doing the same thing as the others but developing their own model with a better cost structure that would be innovative. To that they have to get some money together somehow, probably from investors. Two steps up from a pitch deck is a pitch deck and a prototype that got some customers. So there you go. If I were trying to pitch to a VC though I would be thinking of a plan that is going to make a lot more money, that could justify an enterprise value of $50M at the very least based on conservative multiples. So they have to have something better than “dominate some small area” such as being able to replicate that success for a large number of small areas.
- karanveer 2y ago
  thanks for the insight paul. :D
- Workaccount2 2y ago
  I can't help but feel that a lot of these AI SaaS "start-ups" are just single dev or a small team running a flight by night operation to grab whatever they can before the giants come around and squash them. A flashy platform with crafty prompt injection to hopefully net a few thousand in low effort recurring revenue.
hack_fraud13 2y ago
Tech pump & dump in a nutshell --> find trend/exciting tech, make it user friendly/tailor it to niche, sell. It adds value -- OpenAI isn't going to bother making special AI chatbots for car dealerships or whatever. These companies aren't going to hire coders since that's not their main line of businesses. So someone has to come in and middleman. Maybe calling it a pump & dump is unfair, but there's no denying that the core technology is not in the hands of these startups. These small companies get decimated once the big companies see enough $ in their niche (which is what happened in the early days of the net, too). Fortunes will be made and lost. It's the American dream.
- karanveer 2y ago
  okay
codegeek 2y ago
This is the result of the last decade or so where SAAS has become very lucrative and barrier to entry is almost nil with some many tools to quickly build something. AI is just more fuel on that existing fire. Everyone and their mothers are building a "SAAS" these days. Interesting, now I see all these gurus either selling courses on starting SAAS or selling "boilerplates". AI is great but this is a side effect of it. It's the new Bitcoin/Blockchain gold rush (is that fad over yet). Everyone wants a piece of it and it will continue to bring out the hustlers to make quick money. Like you said, not all are useless and there is obviously a market right now. So people are cashing in until it lasts.
- calvinmorrison 2y ago
  Well the boilerplates like Laravel are incredible. Skip writing your payment processing, your user management, usage billing, email templates and skip right to the business logic you are selling
  - codegeek 2y ago
    I consider Laravel to be a framework. Boilerplates are another wrapper on top of frameworks . For example, there is Laravel Spark which is a boilerplate on top of Laravel. I tried it and it was so bloated and complex to actually change things for your own use case, I dropped it. Many more like that in other ecosystems. Not saying it doesn't work for others but nowadays there are too many people selling boilerplates who have never really built production grade application for at least a decade.
    - calvinmorrison 2y ago
      Well even laravel itself approaches it for us. Its a great ecosystem with a lot of packages built for SaaS products like tenancy or even like sms alert channels. Just random stuff. Only occasionally have I had to write our own you know, boilerplate
- karanveer 2y ago
  yup
burutthrow1234 2y ago
I think the current LLM trend is way overhyped. The thing these companies are doing, crucially, is extracting money from technologically unsophisticated companies and funnelling it into VC pockets. Silicon Valley bubbles are frequently incestuous. You make an HR platform and you sell it to other tech companies. You do sales analytics for tech companies. You make a bank that caters to only tech companies. The problem is that your customers all have the same risk profile as you - if interest rates go up and funding dries up you're all fucked at once. You're all just passing VC dollars back and forth. The AI trend is luring in a wide range of non-tech businesses that aren't VC backed (ex. car dealerships). This is the golden goose for tech companies in a tough macro climate. To be clear I think it's not adding real value for these buyers, but there's a tremendous amount of FOMO. The media has been complicit in selling AI as a panacea for small businesses in a tough climate, and the ultimate beneficiaries will be people grifting off AI hype.
- dvfjsdhgfv 2y ago
  Yeah, there is a kind of hysteria regarding AI and it looks like traditional business fear that if they don't use it somehow they will perish. But there are so many traps here, such as your customers not wanting interaction with your "AI chatbots", the issues of quality (vide the Sports Illustrated scandal), and the question of whether your niche needs any "AI" at all.
  - karanveer 2y ago
    what happened with the sports illustrated scandal?
    - dvfjsdhgfv 2y ago
      https://www.bbc.com/news/business-68035275 https://www.bbc.com/news/business-68035275 In short, it was a series of disasters.
      - karanveer 2y ago
        thanks for this!
light_triad 2y ago
The hype cycle repeats again this time with AI. There will be a lot of noise and fury (after blockchain, nocode, big data, cloud etc etc). The good part is that consumers will vote with their attention and wallets. Only the products that bring real value based on non trivial insights into specific markets will survive. The rest will slowly die off and be forgotten. Also a lot of the VC money just ends up going back to the big players that have monopolized the channels to reach customers and the systems to run those ‘businesses’. Here’s a good overview of the scaling difficulties with AI: ‘Most AI systems today aren’t quite software, in the traditional sense. And AI businesses, as a result, don’t look exactly like software businesses. They involve ongoing human support and material variable costs. These traits make AI feel, to an extent, like a services business’ https://a16z.com/the-new-business-of-ai-and-how-its-different-from-traditional-software/ https://a16z.com/the-new-business-of-ai-and-how-its-differen...
- dvfjsdhgfv 2y ago
  > Only the products that bring real value based on non trivial insights into specific markets will survive. True, but this can easily take decades - vide Uber.
  - muzani 2y ago
    There's a frozen yogurt chain here that nobody buys from. But they take forever to close down. One of the conditions to opening a store is having years of warchest. Most don't close because of ego; they stay lean forever. A company that raises millions or billions? With tech, you can just fire everyone, shut down almost every server, and still keep running. Maybe that's what a lot of them are doing now. Some have laid off almost everyone but the people who know which server to shut down.
    - dvfjsdhgfv 2y ago
      Well, my experience is the opposite - the scheme you describe works if you get one lump sum upfront. But what normally happens is that investors are more careful and will gladly give you more money each year provided that you fullfill certain conditions (growth!). Sure, you can miss the mark a few times, but you have to at least pretend you are doing something - and firing everybody except the senior devops lead probably won't cut it.
deleted 2y ago
[deleted]
DeathArrow 2y ago
No one was interested in ML until a stochastic parrot took internet by storm by mostly taking real facts and producing fiction.
- deleted 2y ago
  [deleted]
- karanveer 2y ago
  who is this parrot u speak of ?
- coldtrait 2y ago
  ChatGPT?
barrenko 2y ago
Really, we should be tired of central banks lowering interest rates, that would solve this and many more coming problems.
- karanveer 2y ago
  how?
x3haloed 2y ago
I think wrappers are fine if they add meaningful value. It does seem that mostly you’re getting charged for a little prompt engineering and a UI skin. I’d personally like to see a good wrapper for autonomous LLM coding. Nothing we have yet quite fits the bill, IMO.
- karanveer 2y ago
  nice way to see it...and most chilled comment here so far. thanks!
SARAHBAKER4444 2y ago
[dead]
michelb 2y ago
Producthunt has been filled with low effort airtable sheets that they call a ‘product’. A lot of things are greatly inflated over there.
- karanveer 2y ago
  aah yes that too...
seattle_spring 2y ago
I am noticing the same thing in recruiter messages via LinkedIn. "Hi! I'm with turd.ai! We are revolutionizing the toilet industry using chatbots! We have $80m in funding from a16z and can offer up to $275k for the right candidate!" It's nuts, the absolute dumbest-sounding ideas (to me at least), with "ai" slapped into the description somewhere, just totally flush with cash for no other reason than they are riding the hype train. Do the folks writing the checks even look into these things?
- karanveer 2y ago
  I agree to this. I think VC backed ones just want to make a quick bank...
- a_tartaruga 2y ago
  Funny enough sewerAI is legit and predates the chatgpt moment
waldrews 2y ago
The root problem is that there is no good way to bill a modest surcharge on top of OpenAI etc. usage costs. GPT store monetization (if they ever get around to it) would be a partial solution. But anything that depends heavily on LLM's, but provides a UI layer or integrations is just stuck with a complex and expensive subscription or credits system - even if the vendor wants to give away a free service, they can't just subsidize OpenAI credits for the world. The cloud and mobile appstores created ecosystems for third party developers, viable for both small value add utilities and major apps. The LLM world has yet to do that.
- karanveer 2y ago
  ok
myles-hn 2y ago
Social. Mobile. Local. Big data. Quantum. Blockchain. Crypto. Cloud. AI. All aboard the hype train..

26 points by karanveer 2y ago

normanlawrence 2y ago

[dead]

fidla 2y ago

Yes

karanveer 2y ago
gg

kingkongjaffa 2y ago

Well hopefully you are not just keeping the same UX as chatGPT Because the value is in what the wrapper helps your specific customer base do. Whether that's through prompt engineering or RAG, or some other technique, the value is in someone else spending the time to think of a UX that helps accomplish a specific job. If you know what you want and how to do it, then likely fiddling around with prompts can get you pretty close, but people are busy and don't have time to test asking chatGPT 500 different prompts to get one that works well, or hunt around for examples to feed into context or into a RAG index. There's an asymmetry of information and effort developing the pipeline/context/prompt construction involved. And this is what add's value. Not simply a chat window and passing whatever the user types in, to openAI's API.

karanveer 2y ago
and im guessing you have an ai solution built yourself?

PaulHoule 2y ago

These are expensive because ChatGPT is expensive. If you really can’t tell the difference between competitors they must compete on price so they aren’t taking a fat slice of profits either. Even if they were doing the same thing as the others but developing their own model with a better cost structure that would be innovative. To that they have to get some money together somehow, probably from investors. Two steps up from a pitch deck is a pitch deck and a prototype that got some customers. So there you go. If I were trying to pitch to a VC though I would be thinking of a plan that is going to make a lot more money, that could justify an enterprise value of $50M at the very least based on conservative multiples. So they have to have something better than “dominate some small area” such as being able to replicate that success for a large number of small areas.

karanveer 2y ago
thanks for the insight paul. :D
Workaccount2 2y ago
I can't help but feel that a lot of these AI SaaS "start-ups" are just single dev or a small team running a flight by night operation to grab whatever they can before the giants come around and squash them. A flashy platform with crafty prompt injection to hopefully net a few thousand in low effort recurring revenue.

hack_fraud13 2y ago

Tech pump & dump in a nutshell --> find trend/exciting tech, make it user friendly/tailor it to niche, sell. It adds value -- OpenAI isn't going to bother making special AI chatbots for car dealerships or whatever. These companies aren't going to hire coders since that's not their main line of businesses. So someone has to come in and middleman. Maybe calling it a pump & dump is unfair, but there's no denying that the core technology is not in the hands of these startups. These small companies get decimated once the big companies see enough $ in their niche (which is what happened in the early days of the net, too). Fortunes will be made and lost. It's the American dream.

karanveer 2y ago
okay

codegeek 2y ago

This is the result of the last decade or so where SAAS has become very lucrative and barrier to entry is almost nil with some many tools to quickly build something. AI is just more fuel on that existing fire. Everyone and their mothers are building a "SAAS" these days. Interesting, now I see all these gurus either selling courses on starting SAAS or selling "boilerplates". AI is great but this is a side effect of it. It's the new Bitcoin/Blockchain gold rush (is that fad over yet). Everyone wants a piece of it and it will continue to bring out the hustlers to make quick money. Like you said, not all are useless and there is obviously a market right now. So people are cashing in until it lasts.

calvinmorrison 2y ago
Well the boilerplates like Laravel are incredible. Skip writing your payment processing, your user management, usage billing, email templates and skip right to the business logic you are selling
- codegeek 2y ago
  I consider Laravel to be a framework. Boilerplates are another wrapper on top of frameworks . For example, there is Laravel Spark which is a boilerplate on top of Laravel. I tried it and it was so bloated and complex to actually change things for your own use case, I dropped it. Many more like that in other ecosystems. Not saying it doesn't work for others but nowadays there are too many people selling boilerplates who have never really built production grade application for at least a decade.
  - calvinmorrison 2y ago
    Well even laravel itself approaches it for us. Its a great ecosystem with a lot of packages built for SaaS products like tenancy or even like sms alert channels. Just random stuff. Only occasionally have I had to write our own you know, boilerplate
karanveer 2y ago
yup

burutthrow1234 2y ago

I think the current LLM trend is way overhyped. The thing these companies are doing, crucially, is extracting money from technologically unsophisticated companies and funnelling it into VC pockets. Silicon Valley bubbles are frequently incestuous. You make an HR platform and you sell it to other tech companies. You do sales analytics for tech companies. You make a bank that caters to only tech companies. The problem is that your customers all have the same risk profile as you - if interest rates go up and funding dries up you're all fucked at once. You're all just passing VC dollars back and forth. The AI trend is luring in a wide range of non-tech businesses that aren't VC backed (ex. car dealerships). This is the golden goose for tech companies in a tough macro climate. To be clear I think it's not adding real value for these buyers, but there's a tremendous amount of FOMO. The media has been complicit in selling AI as a panacea for small businesses in a tough climate, and the ultimate beneficiaries will be people grifting off AI hype.

dvfjsdhgfv 2y ago
Yeah, there is a kind of hysteria regarding AI and it looks like traditional business fear that if they don't use it somehow they will perish. But there are so many traps here, such as your customers not wanting interaction with your "AI chatbots", the issues of quality (vide the Sports Illustrated scandal), and the question of whether your niche needs any "AI" at all.
- karanveer 2y ago
  what happened with the sports illustrated scandal?
  - dvfjsdhgfv 2y ago
    https://www.bbc.com/news/business-68035275 https://www.bbc.com/news/business-68035275 In short, it was a series of disasters.
    - karanveer 2y ago
      thanks for this!

light_triad 2y ago

The hype cycle repeats again this time with AI. There will be a lot of noise and fury (after blockchain, nocode, big data, cloud etc etc). The good part is that consumers will vote with their attention and wallets. Only the products that bring real value based on non trivial insights into specific markets will survive. The rest will slowly die off and be forgotten. Also a lot of the VC money just ends up going back to the big players that have monopolized the channels to reach customers and the systems to run those ‘businesses’. Here’s a good overview of the scaling difficulties with AI: ‘Most AI systems today aren’t quite software, in the traditional sense. And AI businesses, as a result, don’t look exactly like software businesses. They involve ongoing human support and material variable costs. These traits make AI feel, to an extent, like a services business’ https://a16z.com/the-new-business-of-ai-and-how-its-different-from-traditional-software/ https://a16z.com/the-new-business-of-ai-and-how-its-differen...

dvfjsdhgfv 2y ago
> Only the products that bring real value based on non trivial insights into specific markets will survive. True, but this can easily take decades - vide Uber.
- muzani 2y ago
  There's a frozen yogurt chain here that nobody buys from. But they take forever to close down. One of the conditions to opening a store is having years of warchest. Most don't close because of ego; they stay lean forever. A company that raises millions or billions? With tech, you can just fire everyone, shut down almost every server, and still keep running. Maybe that's what a lot of them are doing now. Some have laid off almost everyone but the people who know which server to shut down.
  - dvfjsdhgfv 2y ago
    Well, my experience is the opposite - the scheme you describe works if you get one lump sum upfront. But what normally happens is that investors are more careful and will gladly give you more money each year provided that you fullfill certain conditions (growth!). Sure, you can miss the mark a few times, but you have to at least pretend you are doing something - and firing everybody except the senior devops lead probably won't cut it.

deleted 2y ago

[deleted]

DeathArrow 2y ago

No one was interested in ML until a stochastic parrot took internet by storm by mostly taking real facts and producing fiction.

deleted 2y ago
[deleted]
karanveer 2y ago
who is this parrot u speak of ?
coldtrait 2y ago
ChatGPT?

barrenko 2y ago

Really, we should be tired of central banks lowering interest rates, that would solve this and many more coming problems.

karanveer 2y ago
how?

x3haloed 2y ago

I think wrappers are fine if they add meaningful value. It does seem that mostly you’re getting charged for a little prompt engineering and a UI skin. I’d personally like to see a good wrapper for autonomous LLM coding. Nothing we have yet quite fits the bill, IMO.

karanveer 2y ago
nice way to see it...and most chilled comment here so far. thanks!

SARAHBAKER4444 2y ago

[dead]

michelb 2y ago

Producthunt has been filled with low effort airtable sheets that they call a ‘product’. A lot of things are greatly inflated over there.

karanveer 2y ago
aah yes that too...

seattle_spring 2y ago

I am noticing the same thing in recruiter messages via LinkedIn. "Hi! I'm with turd.ai! We are revolutionizing the toilet industry using chatbots! We have $80m in funding from a16z and can offer up to $275k for the right candidate!" It's nuts, the absolute dumbest-sounding ideas (to me at least), with "ai" slapped into the description somewhere, just totally flush with cash for no other reason than they are riding the hype train. Do the folks writing the checks even look into these things?

karanveer 2y ago
I agree to this. I think VC backed ones just want to make a quick bank...
a_tartaruga 2y ago
Funny enough sewerAI is legit and predates the chatgpt moment

waldrews 2y ago

The root problem is that there is no good way to bill a modest surcharge on top of OpenAI etc. usage costs. GPT store monetization (if they ever get around to it) would be a partial solution. But anything that depends heavily on LLM's, but provides a UI layer or integrations is just stuck with a complex and expensive subscription or credits system - even if the vendor wants to give away a free service, they can't just subsidize OpenAI credits for the world. The cloud and mobile appstores created ecosystems for third party developers, viable for both small value add utilities and major apps. The LLM world has yet to do that.

karanveer 2y ago
ok

myles-hn 2y ago

Social. Mobile. Local. Big data. Quantum. Blockchain. Crypto. Cloud. AI. All aboard the hype train..