In today's hype-driven AI market, founders must ignore 'false signals' like media attention and investor interest. These metrics have zero, or even negative, correlation with building a useful product. The only signal that matters is genuine user love and feedback from actual customers.

The current fundraising environment is the most binary in recent memory. Startups with the "right" narrative—AI-native, elite incubator pedigree, explosive growth—get funded easily. Companies with solid but non-hype metrics, like classic SaaS growers, are finding it nearly impossible to raise capital. The middle market has vanished.

Redpoint Ventures' Erica Brescia describes a shift in their investment thesis for the AI era. They are now more likely to back young, "high-velocity" founders who "run through walls to win" over those with traditional domain expertise. Sheer speed, storytelling, and determination are becoming more critical selection criteria.

According to investor sentiment, the window for startups to pivot to AI has closed. If a company doesn't have a disruptive AI offering in the market, venture capitalists have likely 'lost hope' and written them off, believing they lack the necessary speed to compete.

The narrative of "0 to $100M in a year" often reflects a startup's dependence on a larger, fast-growing customer (like an AI foundation model company) rather than intrinsic product superiority. This growth is a market anomaly, similar to COVID testing labs, and can vanish as quickly as it appeared when competition normalizes prices and demand shifts.

The dot-com era saw ~2,000 companies go public, but only a dozen survived meaningfully. The current AI wave will likely follow a similar pattern, with most companies failing or being acquired despite the hype. Founders should prepare for this reality by considering their exit strategy early.

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.

By raising billions for Safe Super Intelligence without any product plans, Ilya Sutskever is employing an extreme version of the "pre-revenue" strategy. This approach avoids scrutiny of business metrics, allowing the company's valuation to be driven entirely by narrative, talent, and the promise of future breakthroughs, mirroring tactics from previous tech bubbles.

The current AI funding climate is characterized by massive seed rounds raised on long-term vision alone, with no concrete near-term plan. The process has become highly transactional, forcing investors to make decisions in under a week, preventing deep diligence or the formation of a true partnership with founders.