In February, Chegg sued Google, blaming search giant AI-generated summary, tanking traffic, cutting revenues, and causing a 90% stock collapse. Founded in 2005, Chegg built a business around online personal instruction and academic support, helping students with test preparation, essays and homework help.
Then, earlier this month, the company fired 22% of its workforce. Cause? AI tools are smashing through the Edtech industry. Chegg has become one of the most famous victims of AI cannibalism.
But Chegg isn’t alone. Something is happening on a massive scale – and most founders don’t fully grasp it. Chegg could be the most obvious canary in a coal mine, and is an early warning for what comes next.
For over 20 years, Google has shaped the way people discover things online. It built an empire of over 20 billion dollars around one simple habit. Enter keywords, scroll through the results, and click on some links. That model now feels… outdated.
Users have not searched since 2024.
The quiet death of great ideas
Whether it’s ChatGpt, Gemini, or bewildered, people expect instant personalized answers in a single conversational box. They don’t want 10 blog posts – they want the best answer right now.
Changes in user behavior not only disrupt Google’s business model, but also threatens the survival of the entire startup category. What used to be a complete product (micro SAA, idea generator, calculator, educational tool) is now well written prompts.
“It’s not just a search revolution. It’s a product collapse.”
Founders who build SEO-driven content sites, information utilities and lightweight tools are watching traffic disappear. But so are billion-dollar players like Chegg. This is because the generator AI tools absorb core functionality directly into platforms such as ChatGpt and Gemini.
Tryon Shopping and UGC Video (Google Veo 3) Lesson Planning and Homework Help (/Khan Academy and ChatGpt) AI-generated images, music, videos (built-in, no plugins required)
Starting today in the US, you can practically try out clothing in the lab. 👕
Say you’ll see a great shirt, but you’re not sure if it’s right for you. Use the new Try On Tool to upload your own photos and get a feel for how your product looks with * you. * pic.twitter.com/KPGXXRNCG0
– Google (@google) May 20, 2025
It gets even worse. Some people predict that “99% of AI startups will die by 2026,” but not because of competition, but because what they offer is built into abstraction, commoditization, and the modern AI itself operating system.
This article is your early warning – and your survival guide:
To reveal which types of businesses are already engulfed by the wave of AI, helping to identify ideas that could quietly fail before launching, highlighting the kinds of projects that will endure or thrive in this new AI native ecosystem.
Because in the age of AI, only startups built beyond the prompts survive.
Big shift: From Google search to AI prompt
For years, building a startup meant understanding search behavior. We managed to rank high, capture clicks and convert traffic on Google. SEO was a playbook – up until now.
In 2024, its playbook is quietly shredded.
We are entering a rapid era.
Users are clicking on 12 blue links because they have not stopped entering keywords into Google. They open ChatGpt, Prplexity, Gemini, or Claude and simply ask.
“How do I cancel my gym membership?” “Write a cold email for a new SaaS product.” “Give me a 5-day meal plan with under 2,000 calories.” “Summary” “Lean Startup” with 3 bullets. ”
And like that – no ads, affiliate links, no SEO optimized articles – they get exactly what they want.
This is not a redesign of how people search. It is a complete change of expectations. Fast, conversational direct answers have now become standard. Even Google is racing to push out AI overviews to mimic what CHATGPT already has to offer and catch up.
Meanwhile, thousands of startups built around tools, content and small utilities are becoming obsolete overnight.
Types of search to go to ChatGpt prompt
The shift is not merely technical. It’s action. People aren’t searching the web. They’re asking it.
Search Type Prompt Examples Why ChatGpt Gets How-to Guide How to Delete Facebook Account Clear, Direct Answer Summary “Summary of Zero in 3 Places.” Fast, No Fluff Idea Generation “Digital Nomad Startup Idea Idea” Writes “Cold Mail to Potential Investors” Infinite Proposal to Write a Draft 1-Click Draft Education Help “Explain Blockchain like I’m 12.” Personalized Description Programming helps “fix this Python Code Snippet”. Creating Code + Context Quiz “Create photosynthesis quiz.” Dynamic and Custom Travel Planning “3 Days Tokyo Trip for Under $1000” Customized Proposal Product Comparison “Airpods Pro vs Sony WF-1000XM5” Clean Summary Language Learning “Translate this and explain the grammar.” Interactive Support Legal/Policy Documentation “Create a GDPR Compliant Refund Policy.” Zero Friction Output
If you can replace your startup core values with a prompt like this, you are not competing in the market. You’re already out of it.
“Ideas are bad so we’re not killing ideas. We’re killing them because users can do them faster, cheaper, and within the chatbot without leaving the screen.”
Ideas for startups with risk of AI cannibalism
Some ideas don’t fail. They disappear.
This introduces a business model that can be quietly eaten by AI tools without a single tweet or a tech blog post.
Name and Idea Tools – Business Name Generator, Simple Utility for Slogan Apps – Static Travel Tools for Calculators, Timers, Converters, Itinerary Planning, Meal Plan Education Blog – Description Site, SEO Tutorial Beginner Development Tool – Error Lookup Blog, Cold Mail and Copy Tool – Sales & Workshet Creator Sales – kk-site Roundup Template Generator – Refund Policy, Resume, NDA
These businesses are not in the competition. They are defeated by the prompt.
Cross-sector confusion (based on actual trends)
This shift is not limited to side projects or small SaaS tools. The entire industry is being rebuilt:
Education: Chegg’s market collapses as students are collapsed to help ChatGpt. Prompt Debugging and Configuring Settings
Sectors not moving to AI (still)
Not everything is available. This is what AI still can’t touch completely:
Local Services (Plumbers, Hairdressers, Cleaners) Regulatory Industry (Finance, Healthcare, Legal with Responsibility) Mental Health (Therapy, Coaching, Group Support) Community (Reddit, Slack Group, Creator-led Forum) E-commerce Execution (Inventory, Shipping, Transactions) Fintech Backend (Kyc, Covements and (Kise and Curtated)
AI may be useful in these areas, but it will not immediately replace the human layer.
How about AI agents? It’s not that fast.
AI agents are genuine. They are promising. But they’re not there yet.
Most services still do not have an open API agent. You cannot reliably navigate trust, responsibility, and user approvals for complex edge cases.
They automate coordination and low-stakes tasks, but they don’t completely erase the startups building trust, context, and transactional infrastructure.
Founders should ask: “Can I be the layer that AI agents rely on to act?”
Strategy for Founders: Building an AI-resistant startup
How to build something that AI cannot replace
If you are starting a startup in 2025, here is the difficult truth. Everything you can turn into a prompt. The future path is not to build tools to answer questions, but to build systems, communities and products that cannot work without AI.
This is where we focus:
1. Build with real-time data
Static content is toast. However, AI is still unable to see the present. If your product depends on stock prices, weather, traffic, supply chain updates, or anything that changes up to a minute, you have the advantage.
2. I’ll make it human
People still trust people. Community-led platforms, peer advice, user reviews, expert forums – these will never go away. AI can simulate interactions, but it cannot replace real human connections.
3. Enable the transaction
AI is recommended, but you cannot check out, ship, reserve, or pay. The startups that control the transaction layer – the bridge between decisions and actions – are in a much safer place.
4. It is the source of truth
AI is a remix machine. If your business offers verified, curated, or expert insights that others pull, you are upstream. It’s a place where you can defend.
5. Create the tools that AI needs
Instead of fearing AI, move it. Build APIs, workflows, and data services that AI agents rely on. If AI is an interface, the infrastructure can still win.
Takeout: Build beyond the prompt
This is what you need to ask:
Can ChatGpt do this at one prompt? Does this include human judgment and live data? Is my product the answer or does it start after the answer? Can I become part of the AI ecosystem?
If your idea ends at the prompt, it is already outdated. When the place where AI stops in action, trust, feelings, or transactions begins, you are building something that continues.
Conclusion: Prompt First Filter
Ideas are weak so I won’t fail. They’re failing because AI absorbed them before they had the chance.
Don’t ask if the startup will fix the problem. Ask if AI is already solving it for free.
Build beyond the prompt. Or can be replaced by one.
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