The Hard Math: 90% of AI Startups Fail, Spending Half Their Revenue on Infrastructure

New figures making the rounds suggest most AI startups burn out within 12-24 months, weighed down by infrastructure costs consuming 40-50% of revenue.

A sobering set of figures shared by @icenquon frames the structural problem under the AI boom: roughly 90% of AI startups fail within 12 to 24 months, and AI companies spend 40 to 50% of revenue on infrastructure. Those two numbers are related. When half your revenue goes to compute before you've paid a single salary, the path to sustainable margins is brutally narrow.

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