The venture capital world is currently obsessed with Artificial Intelligence. For founders of startups that are not centred on AI, this can feel like hitting a wall.
You might have a strong product, impressive metrics, and a solid team, but you walk out of investor meetings empty-handed. If your business isn't visibly using AI, many investors are likely to pass.
In the first half of 2025 alone, global startup funding saw a significant surge, with AI companies attracting the lion's share of the capital. More than half of all venture capital funding went to AI startups, with over $200 billion raised globally. In the US, the trend is even more pronounced, with 33 AI startups raising over $100 million each in 2025. This is not a fleeting trend; it is the new reality.
This doesn't mean your non-AI company is doomed. It means you need to make AI a meaningful part of your value proposition.
This isn't about “AI-washing” but about genuinely embedding AI to improve efficiency, accelerate growth, and build a stronger business. By showing how AI makes what you have already built more scalable and efficient, you can craft a story that investors can't ignore.
The New Funding Reality: AI Takes Centre Stage
The numbers speak for themselves. In Q1 2025, 53% of global startup funding was directed towards AI. This trend has only accelerated. The first half of 2025 saw record-breaking investments, with mega-rounds for AI giants like OpenAI, which secured a $40 billion funding round, and Anthropic, which raised $3.5 billion.
This intense focus on AI is reshaping the investment landscape, leaving many traditional businesses struggling to attract capital.
Investment in companies not actively using AI has remained flat. This creates a clear divide. On one side are the AI-centric companies attracting huge valuations and funding rounds.
On the other are established businesses with real revenue and users that are being overlooked because they are not perceived as being part of the future.
The message from the market is clear: investors are backing companies that are positioned to win in an AI-driven world. For founders, the challenge is to demonstrate how their business fits into this future.
What ‘AI-First' Truly Means
Adopting an AI-first mindset does not mean you have to rebrand your company as a pure-play AI firm or build your own complex models from scratch. It's about strategically applying existing AI technologies to create measurable improvements in your operations and bottom line. Even a traditional window manufacturer can become an AI-first company if it uses AI to positively impact its business.
The goal is to use AI where it delivers a real impact on margins, efficiency, or growth. This could involve:
A biopharma company, for instance, saved over $80 million by using AI to help develop marketing content. This is a prime example of how integrating AI can lead to significant financial benefits.
A Practical Roadmap to AI Transformation
Becoming an AI-first company does not happen overnight. It requires a clear strategy and a step-by-step approach. Investors back not just who you are now, but who you can become. Outlining a credible path to AI integration is key to winning their confidence.
1. Adopt an AI-First Mindset
The first step is to shift your thinking. Instead of viewing AI as a separate, complex technology, see it as a set of tools that can enhance your existing operations. Many startups are now running lean teams and achieving remarkable results by using AI-powered tools for coding, marketing, and customer support.
You do not need a team of AI experts to get started. The rise of no-code AI platforms has made it possible for non-technical users to build and deploy AI models for tasks like document classification, image recognition, and workflow automation. These tools lower the barrier to entry and allow companies to experiment with AI without a massive upfront investment.
2. Map the Path to AI Integration
Once you have the right mindset, the next step is to create a roadmap. In your investor pitch, you should:
Consider Microsoft's transformation. The company used its huge enterprise base and distribution network to integrate AI at scale, embedding copilots into its core products like Office and Azure. It did not invent everything in-house but applied AI where it amplified its existing strengths.
3. Find Investors Who Look Beyond the Hype
While many investors are chasing the latest AI trends, a handful are looking for companies that are using AI to build real, sustainable businesses. These investors are interested in how AI strengthens your margins, accelerates growth, or creates a competitive advantage.
To attract these investors, you need a clear and compelling story. Here's what we have built, here's how AI is making it better, and here's how it makes us money.
A supply chain software company, for example, could layer in a machine learning model to predict supplier delays. By demonstrating how this AI layer reduces costs and improves efficiency, the company can significantly boost its fundraising prospects.
The Payoff: Tangible Benefits of an AI-First Strategy
Integrating AI is not just about attracting investors; it is about building a better, more resilient business. The benefits are wide-ranging and can have a profound impact on your company's success.
Overcoming the Hurdles on the Path to AI Integration
The transition to an AI-first model is not without its challenges. Many traditional businesses face hurdles such as resistance to change from employees and inadequate data infrastructure.
To overcome resistance, it is important to communicate the benefits of AI clearly and involve employees in the process. Pilot projects can demonstrate the value of AI and help to get buy-in from the team.
To address data issues, you may need to invest in new technologies and develop a comprehensive data strategy. Starting with smaller AI projects that do not require massive amounts of data can be a good way to build momentum.
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Final Thoughts
The current investment climate is challenging for non-AI startups. However, this does not have to be a barrier to success. By adopting an AI-first mindset and strategically integrating AI into your business, you can create a compelling story for investors and build a stronger, more competitive company.
The key is to focus on real-world applications that deliver measurable value. Show how AI makes your existing product more efficient, scalable, and defensible.
By doing so, you can turn the AI hype into a tangible opportunity for growth and secure the funding you need to thrive.
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