Upstart CEO on How to Beat Personal AI Agents: Build the Best Product

“I think there’s just so many companies right now that are looking at what people are doing with AI, with personal agents, and trying to build these walled gardens and say, ‘Oh, man, if people could just freely shop for the best product, they might stop being loyal to us,'” said Paul Gu, CEO of Upstart, during the Q3 earnings call. “I think that just says something terrible about companies that think that way. They’re not confident in the real value-add that their product gives to their customers. I think one thing that will always be really, really centrally important to us is we just want to build the best product. We think we have the best product in a lot of cases. We want to make it even better. We want to build the best product in a lot of our emerging categories. We want to just have no fear around how the customer ultimately finds our product, whether it’s on our surface or whether it’s via a Muse or a Grok or whatever they’re using out there. We want our product to be everywhere, and we want to compete and win on having the objectively best product. We think that the era of personal agents and personal AI is going to usher in a world where people just have much more ability to shop for the very best product, and we think that’s going to help whoever has the best product to offer the customer, and we think we’re going to win in that world.”

Like other online finance providers (i.e. NerdWallet, LendingTree), Upstart has been facing questions from analysts as to whether or not they are prepared to compete with personal AI agents for customers. That’s because AI agents can often provide answers that such sites have long depended on to draw in customers, all while making their own product or destination recommendation.

“Someone just today, I think, looking at us would say, ‘You’ve been around for 14 years, and you haven’t really made any meaningful profits yet. What’s the point of all this fancy AI if it doesn’t make money?'” said Gu. Today, I don’t think we get to complain about how investors are valuing us yet. Even though I think investors are, to be clear, I think investors are wrong about the stock. I think they’re undervaluing the stock, but I kind of think they have every right to do that because they can’t tell if and when we’re finally going to make some real money, and ultimately, it’s our job to change that.”