A16z's Olivia Moore sees upside in consumer AI's economics

Olivia Moore, a partner at Andreessen Horowitz who covers consumer AI, released a report this week on the top 100 consumer AI apps. ChatGPT remains the biggest player by a mile, the report found, though smaller products like Suno and ElevenLabs are showing real staying power. Just as interesting, Moore said, is what the list doesn’t show: about half a dozen consumer categories — social apps, dating apps, marketplaces, retail, travel, finance, and health — have no entrants at all in the top 100.

Moore pushed back on the pessimism around consumer AI’s revenue, including from TechCrunch’s own reporting, which has noted OpenAI’s pivot back toward enterprise customers this year. She called it more of an expansion than a pivot, since OpenAI keeps launching consumer products; the real issue, she said, is that almost all AI revenue so far has come from subscriptions and token usage, which skew toward enterprise and “prosumer” users. She isn’t sure she wants the share of U.S. households paying for AI — just 2.2%, according to a separate State of Markets report — to rise before the market becomes attractive. Instead, she said she’d rather see consumers monetized the way they are on classic internet services: free access paired with ads, with a subscription as an option rather than the default.

On the higher marginal cost of AI services compared with services like Facebook or Google Search, Moore pointed to ChatGPT’s $8-a-month Go plan, which she assumes runs on cheaper models, as an early sign of improvement. She said she expects more consumer companies to build on open-source models rather than relying on frontier intelligence for every task — a shift she’s hearing about from founders — though today’s heaviest-spending users are doing coding and other technical work that still needs frontier models.

Moore argued that most of what looks like consumer AI is really “prosumer” AI. She pointed to three categories of power users driving the bulk of AI revenue: product-building tools such as Lovable, Replit, and Fal; AI ad generators such as Higgsfield and HeyGen; and work-management tools such as Manus, Fireflies AI, and Granola. Pre-AI consumer companies like Canva took six or seven years to add enterprise plans, she said, but companies like Gamma, ElevenLabs, and Cursor have gone from consumer-first to majority-enterprise within about 18 months. “It’s definitely very early,” Moore said of true consumer AI.

Why it matters

If Moore is right, the next wave of consumer AI winners may look less like ad-supported apps and more like the enterprise-leaning tools already topping her list — and the “whitespace” categories she flags (social, dating, marketplaces, retail, travel, finance, health) are where investors are likely to go hunting next.