Alright, let’s be real for a minute. If you’re a startup CEO right now, you probably feel like everyone is telling you to “leverage AI.” Investors, advisors, even your cousin who once built a Shopify store — they’re all hyped up.

And I get it. AI is powerful. But it’s also really easy to misunderstand what it can and can’t do.

Here’s the short version:

• AI is amazing at optimizing and automating repetitive tasks.
• AI can analyze data and surface patterns you’d probably miss.
• AI cannot make real decisions for your business. It doesn’t “discover” or “invent” anything new.

Think of it like this: AI is the best intern you’ve ever had. Works around the clock, never complains, and can crank through spreadsheets faster than you can say “pivot table.” But would you ever let that intern design your fundraising strategy, negotiate your next big deal, or decide which market to expand into? Nope. That’s your job.

The ChatGPT Wrapper Trap

Here’s a story for you. A buddy of mine runs a SaaS company. He was pitched by a startup claiming they had “AI that revolutionizes customer support.” He thought he’d found the holy grail. Turns out, it was literally a glorified ChatGPT wrapper with a few preloaded prompts and a shiny dashboard.

The kicker? They wanted $20K a month. For something he could have built with Zapier and OpenAI’s API for a couple hundred bucks.

That’s the reality right now — lots of companies are charging huge for AI tools that aren’t much more than lipstick on a chatbot.

Do Your Homework Before Buying the Hype

So how do you avoid wasting time and money? Due diligence. Seriously, treat AI vendors like you’d treat any investor looking under your hood.

Ask the tough questions:

• What model are you using? Is it OpenAI, Anthropic, open-source Llama, or something custom?
• How was it trained? On proprietary data or just scraped web junk?
• Where’s the data coming from, and who owns it? Huge for compliance and trust.
• What guardrails are in place for security and privacy?

If they stutter, dodge, or can’t give you a straight answer, you’ve got your answer: it’s probably just a wrapper.

Where AI Actually Wins

Another friend of mine runs an e-commerce startup. Instead of buying a big-ticket “AI solution,” he just had a developer hook ChatGPT into his customer support inbox to draft replies. His team still reviews the responses, but it cut their response time in half. Customers are happier, and the team is less burned out. That’s a win.

I’ve seen AI crush it with things like:

• Automating repetitive data entry.
• Analyzing user behavior to spot churn risks.
• Drafting first passes of marketing copy.
• Summarizing massive reports in seconds.

None of that replaces human brains. It augments them.

Bottom Line

AI is a tool, not a savior. The companies that treat it as a turbo-charged assistant are the ones that thrive. The ones that think it’s a replacement for vision and decision-making? They burn cash on shiny wrappers and end up right back at square one.

So, CTO to CEO, friend to friend:

• Don’t buy the hype.
• Use AI where it really shines — automation, optimization, and analysis.
• Keep the vision and decisions human.

That’s the balance that wins.