There's money to be made in AI startups that boost human connections, according to a VC
Connection is one of a handful of "white space opportunities" that Menlo Ventures is eyeing as fertile ground for new startups in consumer AI technology, according to the firm's recent "The State of Consumer AI" report.
Menlo Ventures and Morning Consult surveyed roughly 5,000 US-based adults in April about their feelings around AI and how they've used the tools within the past six months.
"Today, usage is dominated by these generalist AI systems," such as OpenAI's ChatGPT or Google's Gemini, Menlo Ventures partner Amy Wu Martin told Business Insider. "But we're seeing, starting with specific categories, this move into more specialized apps."
Menlo's research identified five broad categories where specialized AI apps are gaining traction: routine tasks, creative expression, physical and mental health, learning and development, and connection.
Dating, social networking, AI companions, and more
What falls under the connection umbrella?
One niche is dating. Menlo's market map of consumer AI tools highlighted AI-powered matchmaking apps like A16z Speedrun alum Sitch, Keeper, and Ditto. Then there are social networking apps that use AI agents to surface new people to meet, such as Gigi or professional-focused startups like Series or Boardy. Menlo also puts AI companions (think Character AI or Replika) and the turn-yourself-into-a-bot startup Delphi (a Menlo investment) under its connection thesis.
"People are starting to use AI as a bit of a crutch to actually figure out how to interact with people and feel less awkward," Martin said, pointing to examples of how people may use AI to prepare for a date or dinner party.
In addition to dating advice or social coaching, the technology can be a semi-social outlet in itself, enabling users to interact with AI-generated personas.
"The biggest gap in the AI connectivity is multiplayer mode," Martin said, referring to AI that facilitates and participates in group activities.
Social media has largely morphed into entertainment — propelled by the rise of influencers — instead of a place to foster real-life connections. Menlo thinks AI could help bring people together, especially in the still-untapped realm of multiplayer experiences.
"What is the tool that really just helps you be better in your relationships?" Menlo partner Shawn Carolan said. "I don't want more media coming my way. It's almost like the opposite of social media."
But people aren't running en masse to AI for connection just yet.
According to the report, only 14% of participants said they used AI for "staying in touch."
Investors are buzzing about consumer AI
A new crop of startups at the intersection of AI and social networking has stirred buzz with investors.
"We are trying to understand where the puck is going," Martin said. "The next phase, especially consumer, is around these specialized apps."
Menlo Ventures isn't the only firm betting on consumer AI applications.
Amber Atherton, a partner at early-stage consumer fund Patron, recently told BI about wanting to invest in startups that better help people find new relationships and maintain their existing ones.
Beyond connection, Menlo Ventures is also watching spaces like healthcare and wellness, financial management, personalized learning, home-related tasks, and family logistics as opportunities for startups.
Parents, for instance, are AI "power users," according to Menlo's survey.
"Ultimately, consumers are trying to get things done," Martin said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
22 minutes ago
- Yahoo
Apple quietens Wall Street's fears of China struggles and slow AI progress
Apple has been under pressure this year. It's playing catch-up to its fellow tech giants on artificial intelligence, it's seen its stock fall by double digits since the year began, it closed a store in China for the first time ever this week, and looming US tariffs on Beijing threaten its supply chain. On Thursday, the company released its third-quarter earnings of the fiscal year as investors scrutinize how the iPhone maker might turn things around. Despite the gloomy outlook, the company is still worth more than $3tn, and it beat Wall Street's expectations for profit and revenue this quarter. Apple reported a massive 10% year-over-year increase in revenue to $94.04bn, and $1.57 per share in earnings. That's substantially more than the $89.3bn in revenue and $1.43 per share that analysts predicted and is the company's biggest revenue growth since 2021. Apple's iPhone revenue also outperformed Wall Street's expectations, coming in 13% higher than the same time last year. Tim Cook, Apple's chief executive, said in a statement that the company was 'proud' to report a 'June quarter revenue record', showing growth in its iPhone, Mac and services divisions. On an earnings call on Thursday, he said the quarterly results were 'better than we expected'. Dipanjan Chatterjee, a vice-president and principal analyst for Forrester, said rising services tend to boost the company's revenue stream. 'Apple has grown accustomed to having revenue growth in this high-margin services business, which masks other areas of the business not performing as well,' Chatterjee explained . He pointed to several issues that have led to Apple's less-than-stellar product performance of late. He said Apple has lagged on hardware innovation, causing 'consumer apathy', and its AI rollout has been glitchy. Apple Intelligence, Apple's AI product, has been limited to incremental features and rather than transformational upgrades. And it's been more than a year since Apple announced a suite of AI upgrades to its voice assistant Siri – many of which have yet to be released. 'This work [on Siri] needed more time to reach our high-quality bar,' said Craig Federighi, Apple's vice-president of software engineering, during the company's developer conference in June. Donald Trump's sweeping tariffs have also been a pain point for the company as the US president pushes his desire for manufacturing to boom in the US. The vast majority of Apple's products are made in China, with about 90% of iPhones assembled there, despite recent efforts to shift production elsewhere. Cook said during the company's previous quarterly earnings call that he expected the China tariffs to add $900m to its costs this quarter. Apple has attempted to pivot, moving more of its manufacturing to other countries such as India and Vietnam. However, this week, Trump announced a rise in tariffs on India, too, up to 25% starting on 1 August. On Thursday's earnings call, Cook reminded analysts that Apple had pledged to invest $500bn in the US over the next four years and that 'ultimately we will do more in the United States'. He added Apple was 'making good progress on a more personalized Siri' and promised a release next year. Because of the external and internal pressures, Apple has seen its share price plummet this year. Once the industry leader of the 'Magnificent Seven' – the most valuable publicly traded companies in the world, all American technology giants – Apple boasted the highest-performing stock and biggest market capitalization on the US stock market. Now its share price is the second-worst performing after Tesla in percentage decline among the seven. Since January, Apple's stock has fallen roughly 15%. In after-hours trading on Thursday, though, the company saw a slight increase of 2.5% in its share price.
Yahoo
22 minutes ago
- Yahoo
Major company reveals 40 jobs most vulnerable to be snatched by AI as Aussies sacked for new tech
A new study has revealed the roles most at risk and most protected from the rise of artificial intelligence (AI). While these tools have helped many workers across the country, they're causing others to lose their jobs. A poll of more than 1,200 Yahoo Finance readers found 20 per cent fear their job is on the line in the coming years thanks to the technology, while a further 43 per cent hate dealing with AI. Commonwealth Bank (CBA) and Atlassian have made headlines this week for announcing job cuts directly related to prioritising the futuristic new tech. Microsoft has now analysed hundreds of jobs to see which could be wiped out completely by AI in the future. RELATED Smiling billionaire spruiks AI as CEO fires 150 workers over video St George Bank increases fee to deposit or withdraw cash by 200 per cent Gen Z with $100,000 in savings reveals 'common' money traps Aussies waste cash on 40 jobs most at risk of being overtaken by AI Microsoft, which has its own AI model called Copilot, said writing and gathering research were the two areas that artificial intelligence-based large language models (LLMs) are currently well-trained for. The study developed an AI applicability score for each job, and those with the highest results involved those two skills. "We find the highest AI applicability scores for knowledge work occupation groups such as computer and mathematical, and office and administrative support, as well as occupations such as sales whose work activities involve providing and communicating information," the study said."Additionally, we characterise the types of work activities performed most successfully, how wage and education correlate with AI applicability, and how real-world usage compares to predictions of occupational AI impact." Here are the 40 jobs that could soon be taken away from humans thanks to AI: Interpreters and Translators Historians Passenger Attendants Sales Representatives of Services Writers and Authors Customer Service Representatives CNC Tool Programmers Telephone Operators Ticket Agents and Travel Clerks Broadcast Announcers and Radio DJs Brokerage Clerks Farm and Home Management Educators Telemarketers Concierges Political Scientists News Analysts, Reporters, Journalists Mathematicians Technical Writers Proofreaders and Copy Markers Hosts and Hostesses Editors Business Teachers, Postsecondary Public Relations Specialists Demonstrators and Product Promoters Advertising Sales Agents New Accounts Clerks Statistical Assistants Counter and Rental Clerks Data Scientists Personal Financial Advisors Archivists Economics Teachers, Postsecondary Web Developers Management Analysts Geographers Models Market Research Analysts Public Safety Tele-communicators Switchboard Operators Library Science Teachers, Postsecondary Sydney radio station CADA gained a lot of attention earlier this year when it was discovered one of its presenters was an AI-generated person, which went unnoticed for months. Workdays with Thy was a four-hour show that had a mix of music genres, and the host's voice and likeness was taken from an employee in the company's finance team. 40 jobs least at risk of being taken over by AI It should come as no surprise that many of these roles are physically demanding or at least require some element of physical interaction. Here are the jobs least likely to be taken over by AI: Phlebotomists (medical professional who withdraws blood) Nursing Assistants Hazardous Materials Removal Workers Helpers-Painters, Plasterers, Embalmers Plant and System Operators, All Other Oral and Maxillofacial Surgeons Automotive Glass Installers and Repairers Ship Engineers Tire Repairers and Changers Prosthodontists (dentist who treats complex dental and facial matters) Helpers-Production Workers Highway Maintenance Workers Medical Equipment Preparers Packaging and Filling Machine Op. Machine Feeders and Offbearers Dishwashers Cement Masons and Concrete Finishers Supervisors of Firefighters Industrial Truck and Tractor Operators Ophthalmic Medical Technicians Massage Therapists Surgical Assistants Tire Builders Helpers-Roofers Gas Compressor and Gas Pumping Station Op. Roofers Roustabouts, Oil and Gas Maids and Housekeeping Cleaners Paving, Surfacing, and Tamping Equipment Op. Logging Equipment Operators Motorboat Operators Orderlies Floor Sanders and Finishers Pile Driver Operators Rail-Track Laying and Maintenance Equip. Op. Foundry Mold and Coremakers Water Treatment Plant and System Op. Bridge and Lock Tenders Dredge Operators Microsoft said while these jobs might not be affected by LLMs like Copilot or ChatGPT, that isn't to say they might not be impacted by other types of AI in the future. The study called out operating machinery, like truck driving, as one example of how that could change down the line. Morris Misel is a global business futurist who predicts how current trends will evolve in the coming years. He told Yahoo Finance that while the rise of AI might be terrifying to some people, he didn't think there will be large swaths of workers suddenly without a job. "AI will create far more jobs that it decimates," he said. "There are so many things that humans can do that technology and artificial intelligence won't do for a long time." But he said you need to be adaptable and willing to learn new skills if you want to survive. CBA and Atlassian pull the trigger on job cuts due to AI Australia's biggest bank was slammed for revealing it would be shelving dozens of jobs. While this has happened multiple times recently at CBA, this was the first where AI was the main reason behind it. Ninety jobs are due to be cut by the bank, according to the Finance Sector Union (FSU). Half of those are roles in direct banking that are being impacted by a new voice bot system and local customer messaging specialist roles who interact with customers through the bank's online chat. 'To meet the changing needs of our customers, like many organisations, we review the skills we need and how we're organised to deliver the best customer experiences and outcomes. That means some roles and work can change,' a spokesperson told Yahoo Finance. The FSU is concerned what this wave of new AI technology will mean for Aussie workers in the future. 'There is a human cost to this. You can't just replace frontline jobs with a voice bot and expect the same service for customers," national secretary Julia Angrisano said. 'Customers shouldn't expect to speak to someone in Australia anymore, or even someone with a voice box. Atlassian, an Australian-American software company, also revealed this week that 150 staff are getting the flick. The news was delivered to employees in a pre-recorded video message by co-founder and CEO Mike Cannon-Brookes. Customer service and support roles are being impacted in the cuts, with some of their tasks now set to be done by artificial intelligence (AI). The company said jobs weren't being directly replaced with AI, but the technology had helped usher in improvements in customer experience, and, as a result, some roles wouldn't be in retrieving data Sign in to access your portfolio Error in retrieving data
USA Today
23 minutes ago
- USA Today
Proposed 72-hour train route between LA, NY aims to debut in 2026
A rail company is proposing a new privately funded train route that can begin transporting people between Los Angeles and New York City in less than 72 hours as soon as next year. Delaware-based group AmeriStarRail unveiled its coast-to-coast route called the Transcontinental Chief with hopes of it being operational by May 10, 2026, ahead of the United States' 250th birthday and the 2026 FIFA World Cup. The goal date, which lands on National Train Day, is subject to operating agreements with various host railroads, the company clarified. The project has been presented to the National Railroad Passenger Corporation, also known as Amtrak. AmeriStarRail argues that a partnership between the two companies would be mutually beneficial, emphasizing that the route would be more profitable than Amtrak's existing long-distance trains. AmeriStarRail CEO Scott Spencer said Amtrak is seeking more information on the planning and coordination of the proposed system. "This is a way to confront the challenges Amtrak faces and create opportunities for them to succeed," Spencer told USA TODAY. "We're hopeful that all the parties that are involved including the host railroads recognize what a great opportunity this is for our nation." Amtrak did not respond to multiple USA TODAY requests for comment. Transcontinental Chief to replace existing bicoastal routes AmeriStarRail said the Transcontinental Chief train would replace the Southwest Chief and the Pennsylvanian Amtrak routes that currently help transport people between Southern California and New York via stops in Chicago or Harrisburg, Pennsylvania. New Yorkers will board the train from the Hoboken Terminal in New Jersey, a three-mile ride to Lower Manhattan across the Hudson River through the Holland Tunnel. AmeriStarRail clarified that it's unable to directly stop in the Big Apple due to New York Penn Station tunnel restrictions for the passenger cars Amtrak uses, known as Superliners. However, there are no boarding restrictions in Los Angeles. The route would also include a single-level train section from Harrisburg to serve people in Washington, D.C., via Philadelphia, according to AmeriStarRail. "In discussion with various interests along the route, whether that be Victorville, California; Newton, Kanas; Lebanon, Pennsylvania, they recognize the economic engine that the Transcontinental Chief will be for their communities," Spencer said. Spencer added that the Transcontinental Chief would also offer travelers on Route 66 an alternative way back from their nearly 2,500-mile drive. Bicoastal route to be 'rolling rest stop for truckers' In addition to transporting passengers, the Transcontinental Chief would also transport truck drivers and their tractor trailers between the West and East coasts within the three-day span, according to AmeriStarRail. Through a roll-on, roll-off loading system, the route would serve as a "rolling rest stop for truckers" while offering a safe alternative to parking shortages, the company states. "At RailPorts along the route, truckers will be able to drive their entire tractor trailer trucks onto railroad flatcars and then rest and relax onboard Amtrak Coach, Sleeper and Dining cars as they travel 200 - 500 miles during their federally mandated 10 hour rest period," an AmeriStarRail news release states. Intending to debut next May, Spencer said the route would start with intermediate ports available in LA and New York City, with plans to incorporate more in the future. The company aims to transport cars, vans, motorcycles, RVs and charter motorcoaches, eventually also serving the Grand Canyon and Chicago.
