In November 2024, as I reflected on my 25-year journey in tech, I could not help but see history rhyming once again. AI had triggered the greatest technology gold rush of that moment. But beneath the revolution, how much was real business and how much was smoke and mirrors?
Let me be brutally honest: The ecosystem of VCs, founders, and journalists had not changed much since my early days. If anything, it had become more intoxicated with its own narrative. In 2024, I was watching enormous rounds chase companies whose products sometimes amounted to OpenAI API calls wrapped in fancy UIs. The question too often left unanswered was whether those companies could generate meaningful revenue, let alone profits.
I built and sold my second company for $300 million – a real business with real profits. By 2024, I was watching AI companies attract extraordinary valuations while burning cash at an extraordinary pace. The VCs? Too many seemed busy competing for the next "AI unicorn" instead of asking the hard questions. Remember when VCs used to care about unit economics? Pepperidge Farm remembers.
The founders? Many are brilliant minds, don't get me wrong. But they're caught in a cycle of building for PowerPoint slides rather than profit and loss statements. They've mastered the art of AI buzzword bingo while forgetting the fundamentals of business building. Trust me, I've been there – the allure of rapid growth can be intoxicating. But sustainable businesses are built on discipline, not dreams.
And let's talk about our friends in tech journalism. Too much coverage had become a merchant of hype, trading critical analysis for clickbait. "AI startup raises $100M" makes a better headline than "AI startup struggles to find product-market fit." Too many companies looked like wrappers around wrappers, playing a sophisticated game of arbitrage with OpenAI's APIs.
Here was the reality check in 2024: Capital was pouring into AI faster than many companies were proving durable revenue. We were building castles in the cloud, quite literally.
My advice was simple: Focus on what has always worked. Build real solutions for real problems. Your customer is not impressed by a model integration. They care about how you solve their pain points. Profitability is not just a metric; it is a mindset.
I had weathered the dot-com crash, the 2008 financial crisis, and the booms and busts between them. My prediction in 2024 was that the AI financing bubble would eventually break – not because AI was not revolutionary, but because too many companies were playing dress-up instead of building sustainable businesses.
Remember three things: Your product must solve real problems, your customers must be willing to pay for it, and your bottom line must eventually turn black. Everything else is noise.
To the entrepreneurs reading this: Treat your customers like gods, your metrics like gospel, and your runway like gold. No market stays forgiving forever. When the music stops, a real business model matters.
The AI revolution was real, but so was the internet in 1999. My bet was that the winners would not be the ones with the best pitch decks. They would be the ones building real businesses while everyone else was playing pretend.
Get real. Build. Earn the profit.
