Rabbit CEO Jesse Lyu on Startup Survival: ‘Grow Fast or Die Fast’
Embracing the Startup Mentality in a Competitive AI Landscape
Rabbit co-founder and CEO Jesse Lyu has a pragmatic outlook on the high-stakes world of startups. In a recent appearance at StrictlyVC LA, Lyu shared his philosophical perspective on competing against tech giants like Google, Microsoft, and Apple—acknowledging the risks while refusing to back down.
The Vision Behind Rabbit’s r1 AI Assistant
Rabbit’s r1 pocket AI assistant made waves at CES with its unique approach to voice-powered assistance. The compact device combines:
- Intent recognition (understanding user requests)
- Action execution (performing tasks across apps)
“This is the first time in history that a device like this is actually possible,” Lyu noted, explaining how advances in LLMs (large language models) and transformer-based systems enabled their vision.
Overcoming Early Challenges with the Large Action Model
Initial attempts to use standard LLMs for complex tasks proved frustratingly slow. Lyu recalled:
“There’s a demo from another company using an LLM to comment on a YouTube video. In theory, it works—but watching it execute step-by-step takes 2-3 minutes per task.”
Rabbit’s solution? Their proprietary Large Action Model, trained by analyzing:
- 800+ top-frequency apps
- Actual user interactions (frame-by-frame)
- Neural symbolic networks to automate UI elements
Financial Viability and Growth Metrics
Despite being a first-gen product, the r1 achieves rare startup milestones:
- Not losing money per unit sold (thanks to aggressive cost negotiations)
- Approaching 100,000 orders (surpassing Day 1 expectations by 36x)
Lyu dismissed subscription models as contrary to their “cheap and simple” thesis, though future plans may include marketplace features for user-created app models.
The Zen of Competing Against Tech Giants
When asked about competing with AI investments from Apple, Google, and Microsoft, Lyu offered a startup realist’s perspective:
“99% of startups will die. If you think your idea is bulletproof against Big Tech, you’re delusional. Startups are a survival game—you focus on your own path.”
His philosophy? “Competition makes us grow faster or die faster. That’s the nature of startups. I don’t know which it will be, but I’m playing to win.”
Watch Lyu’s full discussion at StrictlyVC LA.
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