Why Are Founders Still Building Companies Like It’s 2019?

The cost of building products is collapsing. The startup playbook hasn’t caught up.

Photo by Jaime Lopes on Unsplash

Two quick mentions before this week’s piece:

• My book, Sleep Again, is coming out on April 9th. It has all the lessons I learned from struggling with chronic insomnia as a founder, and more. Join the waitlist to be the first to know when it’s live.

• I just pushed out a new lesson to my free AI Game Development course, check it out here. It’s meant for non-technical and technical people alike.

Now to this weeks piece.

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Something strange is happening in the startup world right now.

AI is changing the economics of building companies faster than almost any technological shift we’ve seen before, yet if you look at how venture capital operates, you would barely notice anything has changed.

Round sizes are the same. Valuations are the same. The expectation that a startup needs to raise capital, hire a team, and scale headcount as quickly as possible is still the default script.

It’s as if the startup ecosystem is collectively pretending we’re still living in the pre-AI world. The more I think about it, the more I wonder why founders are still following that script.

Because if AI is doing what it appears to be doing, the entire logic of how companies are built might be changing underneath our feet.

The Venture Capital Gravity Field

There has always been a certain type of founder that venture capital loves.

A strong team with an incredible background is basically like the most attractive person at the party. Everyone wants to date them. If you’re that founder, you will always have the option to raise money.

And here’s the uncomfortable truth: many founders raise simply because they can.

Not because they actually need the capital, but because the system rewards it. The fundraising announcement creates credibility, momentum, and social proof. It’s the default badge of legitimacy in the startup world. I know because I’ve also felt proud in the past about raising for Silicon Valley top tier funds for my own startup.

But raising venture capital is not just a financing decision. It’s a strategic decision about what kind of company you’re building. Once you take venture money, you are no longer just building a company. You are now participating in a financial instrument designed to return venture-scale outcomes on a specific timeline. That changes everything.

I say this as someone who has been on both sides of the table. I’ve been a angel investor turned VC and I’ve been a venture backed founder.

There are companies that require funding to exist. Infrastructure-heavy businesses, breakthrough tech and certain kinds of services genuinely need capital to get off the ground.

But AI is quietly moving the boundary of what actually requires funding.

Startups Needed Money Because They Needed People

Historically, startups needed capital because execution required headcount.

You needed engineers to build the product. You needed designers to design it. You needed marketers to promote it. You needed operations people to keep the system running. Money was essentially a way to buy execution capacity.

AI is starting to dismantle that equation.

A growing portion of the work that previously required teams is now becoming software-driven. Code generation, design generation, marketing assets, content, research, analytics, customer support. These things are increasingly handled by machines.

The result is that the cost of execution is collapsing. And it’s not collapsing linearly. It feels exponential.

My Own Productivity Has Gone Vertical

The easiest way I can describe this shift is through my own workflow.

If I compare what I could build in the summer of 2025 with what I can build today at the end of Q1 2026, the difference is honestly absurd. The amount of output I can produce in the same amount of time has increased dramatically.

I would roughly characterize it as my efficiency doubling every few months.

And the truly interesting part is that we’re still very early in this transition.

Right now AI mostly behaves like a tool. You ask it to do things and it helps you execute faster.

But it is clearly evolving toward something else: autonomous collaborators.

Agents that can write code, run experiments, generate assets, analyze data, and deploy new features. As these systems continue to develop at breakneck pace, the marginal cost of building new products drops even further.

At that point, execution stops being the main constraint.

The One-Person $1BN Company Is No Longer Science Fiction

If you extrapolate this trend far enough, you arrive at a conclusion that still sounds radical but increasingly feels plausible: the one-person company operating at massive scale.

A founder orchestrating systems rather than managing employees. AI agents acting as the execution layer while the founder focuses on strategy, product direction, and distribution.

Ten years ago the idea of a billion-dollar company with one employee would have sounded ridiculous. Today it sounds improbable. In another ten years it may sound obvious.

We have already seen very small teams build extremely large companies. AI simply pushes that trajectory further.

The Real Problem Is Lack of Curiosity

What worries me is that many founders don’t seem curious enough about what AI is actually solving. A lot of startup thinking is still based on the old playbook. Raise capital, hire people, scale headcount, grow revenue.

But AI is attacking one of the biggest constraints startups have always faced, which is execution bandwidth. If the amount of things a single founder can build in a week doubles every few months, the entire structure of startup economics changes.

You might not need funding to scale people. Because you might not need people.

The Question Founders Should Be Asking

Instead of asking how much money they should raise, founders might want to ask a different question entirely: what can I build without raising anything?

AI is making experimentation radically cheap. Founders can build faster, test faster, and reach early revenue faster than ever before. And if you can reach meaningful revenue before raising capital, the power dynamics shift dramatically.

Funding becomes optional. Not a prerequisite.

The biggest thing AI unlocks is not automation. It’s leverage. A single motivated founder with the right tools can now operate at a scale that previously required entire teams.

That should fundamentally change how founders think about building companies. And yet much of the startup ecosystem still behaves as if none of this has happened.

Which raises an uncomfortable question: are founders raising venture capital because they actually need it? Or because they haven’t yet realized that the rules of the game have already changed?