OpenAI embraces the 'platform paradox' by selling API access to startups that compete directly with its own apps like ChatGPT. The strategy is to foster a broad ecosystem, believing that enabling competitors is necessary to avoid losing the platform race entirely.

Instead of fearing competitors who copy their product, Synthesia's founder sees them as a net positive. The increased competition generates more market iterations and signals, helping them discover the most valuable use cases for the new technology faster than they could alone, while also sharpening their focus.

Apple isn't trying to build the next frontier AI model. Instead, their strategy is to become the primary distribution channel by compressing and running competitors' state-of-the-art models directly on devices. This play leverages their hardware ecosystem to offer superior privacy and performance.

Unlike mobile or internet shifts that created openings for startups, AI is an "accelerating technology." Large companies can integrate it quickly, closing the competitive window for new entrants much faster than in previous platform shifts. The moat is no longer product execution but customer insight.

As consumers become wary of "AI," the winning strategy is integrating advanced capabilities into existing products seamlessly, like Google is doing with Gemini. The "AI" branding used for fundraising and recruiting will fade from consumer-facing marketing, making the technology feel like a natural product evolution.

AI favors incumbents more than startups. While everyone builds on similar models, true network effects come from proprietary data and consumer distribution, both of which incumbents own. Startups are left with narrow problems, but high-quality incumbents are moving fast enough to capture these opportunities.

The initial AI rush for every company to build proprietary models is over. The new winning strategy, seen with firms like Adobe, is to leverage existing product distribution by integrating multiple best-in-class third-party models, enabling faster and more powerful user experiences.

Google can dedicate nearly all its resources to AI product development because its core business handles infrastructure and funding. In contrast, OpenAI must constantly focus on fundraising and infrastructure build-out. This mirrors the dynamic where a focused Facebook outmaneuvered a distracted MySpace, highlighting a critical incumbent advantage.

A powerful startup strategy is to screenshot a successful app and use AI to rapidly generate a clone tailored to a new market. This "business arbitrage" allows founders to quickly test proven models in new geographies or vertical niches with minimal upfront development.