Originally a video conferencing infrastructure provider, LiveKit's trajectory transformed after its technology was used for ChatGPT's voice feature. This pivot into a core component of the voice AI stack made it an 'accidental AI company' and propelled it to a unicorn valuation, illustrating how foundational tech can find massive new growth in AI.
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Voice AI company ElevenLabs' rapid scaling to $330M ARR defies the narrative that large labs will dominate all AI verticals. Their singular focus allows them to build a superior, more opinionated "best-in-class" product that generalist models cannot easily replicate.
The most successful AI applications like ChatGPT are built ground-up. Incumbents trying to retrofit AI into existing products (e.g., Alexa Plus) are handicapped by their legacy architecture and success, a classic innovator's dilemma. True disruption requires a native approach.
Like containerization, AI is a transformative technology where value may accrue to customers and users, not the creators of the core infrastructure. The biggest fortunes from containerization were made by companies like Nike and Apple that leveraged global supply chains, not by investors in the container companies themselves.
Fathom's strategy was to build a robust system for meeting capture and processing, anticipating that transcription costs would drop and GenAI would mature. When GPT-4 launched, they simply "dropped in the engine" to their pre-built "sports car," instantly upgrading their value and triggering explosive growth from $1M to $10M ARR.
Most successful SaaS companies weren't built on new core tech, but by packaging existing tech (like databases or CRMs) into solutions for specific industries. AI is no different. The opportunity lies in unbundling a general tool like ChatGPT and rebundling its capabilities into vertical-specific products.
Counter to fears that foundation models will obsolete all apps, AI startups can build defensible businesses by embedding AI into unique workflows, owning the customer relationship, and creating network effects. This mirrors how top App Store apps succeeded despite Apple's platform dominance.
AI voice isn't just about cost savings. The technology has improved so much that it often provides a better customer experience (NPS) than human agents. This dual benefit of high ROI and improved experience means customers are eagerly adopting these solutions, creating a powerful market pull for founders.
The CEO of Numeral notes that in the current fundraising climate, startups must heavily feature AI in their pitch to secure investor meetings. Furthermore, landing a major AI lab as a customer has become a key signal for VCs, leading to valuation multiples as high as 100-200x revenue for some companies.
Previously, building 'just a feature' was a flawed strategy. Now, an AI feature that replaces a human role (e.g., a receptionist) can command a high enough price to be a viable company wedge, even before it becomes a full product.
During major tech shifts like AI, founder-led growth-stage companies hold a unique advantage. They possess the resources, customer relationships, and product-market fit that new startups lack, while retaining the agility and founder-driven vision that large incumbents have often lost. This combination makes them the most likely winners in emerging AI-native markets.
