The Kids Are Alright (and They’re Building AI Startups)

Anyone else seeing “Scaled my startup from $0M to $20M in ARR within 10 months and under 8 employees 🚀 ” type of post in their feed everyday?

The average age of these founders seems to be way younger, the ARR growth is incredibly impressive, and the efficiency with which they’re building is kind of hard to believe.

So one of two things must be true:

1. Some / all of these people are frauds; or
2. There is a new generation of AI startup founders that are starting successful companies way younger than we’ve seen in the past, and doing it with much less capital and fewer people.

To test this hypothesis I did a very rough (and very imperfect) analysis of the average age at time of founding of the top 10 AI-native startups founded after ChatGPT (taken from the LeanAI Leaderboard h/t Henry Shi), and compared this to the top 10 privately held companies founded prior to ChatGPT. Think Anysphere, Lovable, Mercor, ElevenLabs vs OpenAI, SpaceX, Stripe etc…

• Average age of post ChatGPT founders at time of founding company: 25.6
• Average age of pre ChatGPT founders at time of founding company:  31

A couple interesting things to think about if this trend holds:

1. My bias as a VC has been to back founders with at least a bit of life experience. It's rare to have that 3 years out of university, but I’m thinking that was / is wrong and outdated.
2. Almost certainly, with the exception of OpenAI and Anthropic, the biggest AI companies have not yet been created, and those still may be founded by founders closer to the 31+ average. This trend of founders of consequential companies skewing much younger may not hold.
3. These companies are incredibly efficient. If founders need less money from VCs, competition is going to get even more fierce, returns may go down, and knowing why you win as a VC will be critical.
4. How VCs source is going to have to change. These companies are being built in the open, online, and may not swim in the traditional networks we play in.

Effective immediately, I’ll be listening to less Neil Young and more Chappell Roan.