Pattern I keep seeing in AI agent startups:

> announce super powerful agent
> ship agent
> tons of sign-ups
> insane revenue growth
> massive funding round
> product simply does not work
> what now?
> heavy churn likely

Customers bought the dream of an agent that does everything. 

But the product fundamentally does not work.

Worse yet, it produces junk outputs. Useless e-mails. Robocalls that scream “robot” and never convert a customer. 

This AI slop means more work for humans, not less. So they cancel.

When the Sugar High of Growth Wears Off 

As churn gets worse and worse, growth will become impossible to maintain. Eventually, revenue will trend down.

If the startup can make the agent work before runway runs out, it could still be a success. But for a lot of agents, they’re not even close to living up to the promises.

And because these startups have raised at such high valuations, raising more money will be hard. They’ll have to continue the crazy growth. 

The likely outcome for these startups: death. 

The problem with these companies is they have overpromised and underdelivered.

Lessons From a $100 Billion SaaS Company You’ve Never Heard of

20 years ago, I sat in the all staff meeting at Epic. 

“What’s the best way to make sure we meet customer expectations?” founder Judy Faulkner asked.

“Work really hard!”

“Always put the customer first.”

People continued giving these Boy Scout answers. Judy shook her head.

“The key is to set expectations very low.”

That’s how Judy built a company that the Acquired guys estimate is worth over $100 billion. 

Nail It, Then Scale It

AI agent startups love to claim they automate an entire job. Very few pull it off.

A better approach: nail one small part of a job. Scale that across lots of customers.

Then add more capabilities.

People will happily pay for a product that does one important task well. But if you try to do everything and screw it up, they’re going to churn. 

Wrap-Up

Instead of building some superagent to do all things for all people, make your focus as narrow as possible. Test the heck out of your product and be sure it works in real-world conditions.

It’s exciting to have a buzzy launch and get to millions of revenue overnight. 

But if you want to build an enduring company, try doing it Judy’s way.

More on tech: 

The Secret AI Weapon That Could Close Your Round: VC Boom

No, You’re Not Getting a $250k Angel Check — Here’s Why

“Don’t Be Afraid to Fail” — Three Lessons from Elon That Will Make You a Better Founder, Leader, and Investor

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