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Revenge of the GPT Wrappers: Defensibility in a world of commoditized AI models
Why network effects and distribution will be king, once more
Growth and network effects soon to return as a dominant force The AI landscape has evolved a ton in the past year, with many new entrants, booming traction for many AI-first products, and existential questions for foundation model startups. I’ll argue that it’s in this environment of a massive war between “GPT wrappers” that the traditional defensibility strategies — particularly sustained advantages in distribution and network effects — will return to the forefront. All the while, the ecosystem is teeming with new app-layer startups that specialize on specific niches — creative tools, customer service, legal, and many other sectors — that show $0 to $5M+ ARR growth in under a year.
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