You try to tackle every possible feature, every potential market, and every use case under the sun. But what ends up happening is that you spread yourself too thin. Your resources get stretched, your focus gets diluted, and your product suffers as a result.

You try to tackle every possible feature, every potential market, and every use case under the sun. But what ends up happening is that you spread yourself too thin. Your resources get stretched, your focus gets diluted, and your product suffers as a result.

So what's the alternative? How can you build a defensible AI startup in 2023 without boiling the ocean? The answer lies in finding your niche, focusing on a specific problem, and building a product that solves it exceptionally well.

The most delightful innovations in AI are coming from the bottom up, not the top down. Companies like Midjourney, Runway, and Stable Diffusion have captured the public imagination by building on open-source horizontal models like ChatGPT. These models form the foundation of the AI boom, but it's the application layer where venture-scale businesses will thrive.

Speed is arguably the one definitive advantage all startups have against incumbents. Midjourney and DALL-E were early to shipping great horizontal platforms, but Midjourney has come out on top thanks to quick product execution. They didn't waste time trying to do everything. Instead, they focused on building a product that solves a specific problem and executed it with speed and precision.

So how can you apply this principle to your own AI startup? Get creative and think about what new product paradigms and interfaces are now possible thanks to AI. Instead of trying to build a product/tool that an existing software company can easily add to their suite, focus on creating something that is unique and defensible.

ChatGPT's success is a case study in using advances in natural language processing (NLP) to drive a shift change in UI/UX. While the underlying technology, GPT-3, already existed, it was the conversational interface built on top that made it accessible to a mass market. Successful AI products can start out looking like consumer companies, like Midjourney and Leonardo.ai, which have grown into the largest Discord communities in the AI space.

To build mindshare and grow your community, develop an online personality towards issues relevant to the AI community. Offer perks to existing community members, such as gated access to beta users through Discord, to foster customer evangelists and incentivize non-members to join. Appoint power users as moderators in branded community spaces to create a sense of belonging and engagement.

But remember, startups can win initially by moving quickly, but long-term moats are built by going where big tech and incumbents won't. In a world where anyone can access language models, verticalized solutions based on a deep understanding of a target persona is one of the best defensible ways to build in AI. Moats are cemented by building with collaboration, integrations, permissioning, and workflow top of mind.

When evaluating the market, it's important to understand the buying power of your audience and their actual needs. Don't try to boil the ocean and cater to every possible use case. Focus on a specific problem and build a product that solves it exceptionally well. The only truly defensible items in the application layer are workflow, product, community, and rapid iteration.

In conclusion, building a defensible AI startup in 2023 requires focus and speed. Instead of trying to do everything, find your niche and build a product that solves a specific problem exceptionally well. Develop a strong online presence and community engagement to grow mindshare. And remember, long-term moats are built by going where big tech and incumbents won't. Focus on collaboration, integrations, permissioning, and workflow to solidify your position in the market.

Actionable advice:

1. Find your niche and focus on solving a specific problem exceptionally well.
2. Develop an online personality and engage with the AI community to grow mindshare.
3. Build defensibility by going where big tech and incumbents won't, focusing on collaboration, integrations, permissioning, and workflow.

"“Big things have small beginnings.” And by starting small, you can build something truly remarkable."