The AI Gold Rush Is On; And How Not to Build Your AI Leverage on Quicksand.

1,000s of new AI companies emerge weekly, yet 40% are destined to fail.

Why does that matter to your business?

If you build your AI Tech Stack exclusively on rented SaaS land, this recipe could be a long-term disaster for your business operations.

They're not true AI innovations but wrappers around existing publically available AI models (like ChatGPT or Claude).

Here's the harsh reality:

AI wrappers are a short-term play.

These companies slap a fancy UI on someone else's AI model and call it innovation. But they're building on borrowed time and borrowed tech.

Businesses are setting themselves up for failure.

Companies eagerly onboard these wrapper products, only to find themselves scrambling when the provider goes bust in 6-12 months. It's a costly game of musical chairs.

The real power lies in custom built tools.

Smart businesses are building their own internal AI tools, creating a moat around their technology. They're not at the mercy of fly-by-night startups.

Off-the-shelf solutions level the playing field (in a bad way).

Where's your edge if you and your competition use the same micro SaaS AI wrapper? It's like bringing the same weapon to a duel. Get a better weapon!

Owned AI tools are the future.

Businesses that invest in developing their own AI solutions are future-proofing their operations. They're not just users of AI; they're masters of it.

The AI landscape is shifting rapidly. Those who build their own tools will thrive.

Those who rely exclusively on wrapper products will be left scrambling when the music stops.

Don't be caught without a chair when the AI wrapper SaaS bubble bursts.

My 5-Step Playbook for Building a Moat Around Your AI Advantage

Step 1: Identify real business problems, not AI hype

• Focus on solving actual pain points, not just implementing trendy AI

• Look for process gaps where AI can bridge inefficiencies

• Identify the repetitive tasks your team does regularly and start there

Step 2: Consider Custom AI Tools, Don’t Always Buy SaaS Wrappers

• Create proprietary solutions owned by your business

• Avoid dependency on third-party AI SaaS products that may fail (and cost a fortune!)

• Partner with innovative AI agencies to solve the specific gaps in your business

Step 3: Start Lean and Iterate Quickly

• Build a lightweight MVP to test with the early adopters on your team

• Gather feedback and improve rapidly

• Don't wait for perfection before launching

Step 4: Focus on Business Value, Not AI Bells and Whistles

• Quantify and communicate the ROI of your AI solution

• Visualize and quantify the impacts on your bottom line

• Frame pricing against the established value over the life of the custom solution

Step 5: Plan for Long-term Sustainability

• Build solutions that can evolve with the changing AI landscape (plug-and-play new models as they are released)

• Create processes for continuous improvement

• Develop in-house AI expertise to reduce external dependencies

The AI gold rush is on, but sustainability is key.

Focus on building long-term AI-powered value in your business by solving real problems with custom tools.

Next week’s issue is BIG.

I’ll be releasing my FREE AI-Readiness Assessment tool to determine how AI-ready your business REALLY is, and I'll be sharing it here with you!

I've distilled hours of transcripts from dozens of client discovery calls (with the help of AI, of course) with business owners into 18 simple questions to score how AI-ready your business is.

This is a free tool to help you feel confident on your journey to being an AI-enabled entrepreneur.

Make sure to look out for next week’s issue for this powerful assessment of your business’s AI-readiness.

OK. That’s all. Talk to you next week from the Chief AI Officer’s (CAIO) desk.

-Ed

If you found this newsletter valuable, please consider sharing it with a friend or colleague.

Did someone forward this email to you? 👉 Subscribe Here.