Chatbot or Salesbot?

AI apps have a big problem: they’re broke. Everyone loves using them, but nobody wants to pay $9.99 a month for the 57th subscription in their life. Enter Koah, a scrappy startup that just raised $5 million to do the unthinkable: bring ads into AI chats. Yeah, you heard that right: the future of your deep and meaningful conversation with an AI about your career might be interrupted by a tasteful ad for UpWork.

Koah isn’t swinging at the big boys like ChatGPT or Google Gemini. Those giants are too busy flexing about IQ points and pretending they don’t care about money because Microsoft and Google are footing the bill. Instead, Koah is going after the smaller AI apps, the Luzias, the Heals, the Liners, the DeepAIs, that are popular but can’t figure out how to keep the lights on. While the big players brag about billion-dollar partnerships, Koah is basically saying: “Cool story, but how are the rest of you paying rent?”

Here’s the twist: Koah’s ads actually work. Early tests show click-through rates at 7.5 percent, which is four or five times higher than old-school ad networks like AdMob or AppLovin. Translation? Users aren’t just ignoring these ads like they do on Facebook; they’re actually clicking. Some app developers even made up to $10,000 in the first month. Suddenly, those smaller AI apps don’t look like starving artists; they look like indie bands that just sold out a stadium.

And let’s be real: subscriptions are the gym memberships of the digital world. You sign up, use it twice, then cancel when you realize you’ve got six other monthly charges draining your bank account. Ads, on the other hand, are annoying but familiar. They kept Google search free, they made Facebook billions, and they even pay for your aunt’s Candy Crush obsession. Koah bets that ads will also keep AI apps alive without making users cough up yet another monthly fee.

The rivalry here is delicious. While OpenAI and Google fight an arms race over who has the smarter bot, Koah is basically whispering, “Hey geniuses, who’s actually paying your bills?” Meta’s AI team can pump out all the models it wants, but unless Zuck starts selling Reels inside ChatGPT, someone’s got to figure out how this whole AI thing makes money. Koah wants to be the one holding the keys to the cash register.

Why does this matter? Because AI isn’t just about brainpower, it’s about survival. If Koah’s ads actually keep apps free and fun to use, smaller developers might finally stand a chance against giants with trillion-dollar backing. But it also means that your next heart-to-heart with an AI could go something like: “I’m sorry you’re feeling lonely tonight… have you tried Skillshare?”

Would you rather pay yet another monthly fee, or let your chatbot slip an ad into the conversation and keep the whole thing alive?

- Matt Masinga