Over the past 18 months, we’ve seen an explosion of “AI startups.” But after auditing 47 early-stage AI SaaS products, here’s what stood out: 72% were thin wrappers around GPT or Claude APIs 64% had no proprietary data 81% had no defensible moat Most had <6 months runway at current burn The uncomfortable reality: We’re in an “AI veneer” cycle, not an infrastructure cycle. The majority of products: Call an API Add UI Add billing Market as “AI-powered platform” The margin compression problem is obvious: OpenAI lowers price → your margins die A better model launches → your differentiation dies Big player clones you → distribution wins This isn’t anti-AI. It’s anti-illusion. The real value layer is: Workflow integration Network effects Proprietary data loops Embedded distribution For example, while building EPIC(https://no-edit.lovable.app)(we’re experimenting with workflow-level integrations rather than raw prompt wrappers), we realized the model layer is becoming commoditized faster than most founders expect. The question isn’t: “Can I build with GPT?” It’s: “Do I own anything if GPT improves tomorrow?” That’s the real risk founders aren’t pricing in. We’re watching a gold rush where the shovel sellers (model providers) are compounding, and most miners are building on rented land. Curious how others are thinking about defensibility in AI SaaS right now.