'We Use AI' is the New 'We Have a Website': Nithin Kamath's Sharp Reality Check for AI Obsessed Startups

In budding up conversations over the startup ecosystem, Nithin Kamth’s statement has stirred fire. The hugely popular technology, artificial intelligence, may have become lost in the buzz of the world. The startup guru, Zerodha co-founder and CEO Nithin Kamath claims that many founders, especially in tech, are using AI as a marketing status word. 

For Kamath, a startup pitch with a leading line such as “We use AI” is no longer commendable, and one can no longer rely on it to pursue the investors. 

The AI prompts are so overdone, that it does not hold any competitive advantage, and can only be used to satisfy a basic business requirement. The company’s co-founder used X to comment that founders should stop relying on such fancy decks and instead put more focus on showing real business value and innovation.

Nithin Kamath's Reality Check for AI-First Startups

Nithin Kamath tried to underline his point with a comparison that quickly went viral on social media. He said that just stating that a startup is using AI in its business model is not enough to make you different. Rather, using AI is now as normal as a daily routine, and does not factor into an investor’s attention.

“Bragging that your product uses AI is like bragging that you take a bath every day. It’s not a differentiator. In fact, opening your pitch with it is a surefire way to get ignored, not just by us, but by most serious VCs,” Kamath wrote.

Kamath also said that we can create presentations and shiny pitch decks nowadays fairly easily as a result of AI. But deceptive-looking slides cannot eliminate authentic and creative innovation. He told founders that investors are no longer bored of getting the same AI-hype recited in pitches after paces.

With a booming number of new startups going by, it is becoming more crucial to be original, be a problem solver and offer a compelling proposition, rather than simply adding another tech word into a presentation

Beyond box: Why Investors Are Betting on Value, Not Hype?

Kamath's remarks have brought an important conversation back to life: the role artificial intelligence plays in today's startup ecosystem is changing. As AI keeps reshaping economies, investors are more selective as to how they assess AI-powered businesses. It's no longer about what AI does, it's about what it does for people.

In this conversation a clear message emerges, you can't just say you're using AI. People want to know how your product solves a given problem. How it improves productivity and how you turn it into a viable business. No matter how much fancier you get, investors do not get lured by it. Business owners and stakeholders look for efficiency So, In short, AI is becoming the new normal, after being the the 'word' of the year.

While I find Kamath's critique in my view a bit harsh, the point is well taken. We're at a stage where the startups that succeed will not be the ine with the most fancy words. They will those that have the solution and the ability to execute and a track record of impact.