Open AI just released an update to ChatGPT that allows you to upload and “chat” with your PDF documents. This has been a feature that’s been one of the most popular indie hacker products to build — some reaching six or seven figures in ARR. Does this mean the end of these wrappers across the board? Some thoughts:
More competition, lower margins. This is a product that was bound to get cheaper. It’s easier than ever for developers to launch something like this. The best distribution channels and SEO are now crowded. Whether it’s OpenAI taking this margin or niche competitors building on better APIs, similar products will probably move towards the cost of inference.
Focus and distribution matter. Even though OpenAI has the benefit of seeing what’s working with its API, it can’t tackle all of the problems (but it can solve a lot). Google might be an interesting example — it captured many of the opportunities adjacent to search, but not everything.
“What if OpenAI builds this?” is the new “What if Google builds this?”. Many of the takeaways are the same: large companies find it hard to rationalize entering a small market, large companies can’t navigate the idea maze as well as startups, and large companies have structural issues as to why they can’t compete in a new market. None of these apply to OpenAI and Chat with your PDF (which is the problem). However, there will be many wrappers that are at odds with some form of OpenAI’s business model (e.g., usage of the API, AI safety, training data, etc.).
Expansion is key (quickly). Once the initial idea is validated and finds a semblance of product-market fit, you need to expand into the adjacent problems. It could be as simple as supporting UX that’s materially different from chat or a more complicated backend pipeline. Some of the best opportunities are time-limited.
This was super Matt. Been thinking about this for sometime, because we are a wrapper. Maybe I am naive, but there are still many reasons for us to exist The "more complicated backend pipeline" is reason #1. You nailed it.
RIP, ChatPDF.