Ai Based Business

Profitability

Revenue & Salary

How Profitable Is An Ai Based Business? (Updated for 2024)

Pat Walls

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Updated: September 19th, 2024

How Profitable Is An Ai Based Business? (Updated for 2024)

So you want to start an AI-based business?

And the first question that came to your mind was, “well, are AI-based businesses actually profitable?”

Especially considering:

You could start a AI-based business with as low as $32
Based on our data, AI-based businesses generate an average of $335K per year
You could see gross margins as high as 98% with AI-based businesses

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a AI-based business.

Let’s dive in!

Is an AI-based business profitable?

Yes, an AI-based business is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $335K per year with an estimated gross margin of %, you could expect to recover your investment within months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your AI-based business.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your AI-based business is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is an AI-based business worth it?

If you’re wondering if a AI-based business is worth it, the answer is a big YES. With AI-based businesses, you have the potential to earn $335K per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a AI-based business to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful AI-based businesses case studies.

Examples Of Profitable Ai Based Businesses

Here are a few examples of profitable AI-based businesses, and a few more details about them:

1. Framer ($2.4M/year)

Jorn came up with the idea of Framer after working with his co-founder at a company called Sofa, which they founded in 2006. Initially, they focused on building Mac apps but had to rely on agency work for major clients to fund their projects.

After gaining valuable experience, including working on the first native Facebook mobile app for iPhone, Jorn and his co-founder decided to leverage their combined expertise from Sofa and Silicon Valley to create a new startup. This led to the founding of Framer, aimed at building a lasting company for the next two decades.

Jorn explaining how they conceptualized the business

Is it profitable? Yes
How much money it makes: $2.4M/year

How Jorn van Dijk Built Framer To a $24M ARR Business

Learn how Framer evolved from a JavaScript library into a full-fledged, no-code website design tool, generating an impressive $2.4 million annually with over 50 successful Product Hunt launches.

Read this case study

Read by 368 founders

2. neural frames ($204K/year)

After struggling to create affordable music videos for his songs, physicist-turned-entrepreneur Nicolai Klemke founded neural frames, an AI-driven tool that now boasts 130k visitors and $17k MRR just months after launch.

Is it profitable? Yes
What's the gross margin? 60%
How much money it makes: $204K/year
How much did it cost to start: $500

How A Doctorate In Physics Built An AI Video Generation Tool [$17K MRR]

AI music video generation startup neural frames, founded by Nicolai Klemke, has seen impressive growth since its launch in January, with 130k visitors and an MRR of $17k as of October; Klemke shares the process of building the product, launching the business, and attracting and retaining customers, highlighting the importance of listening to customers and implementing the right features.

Read this case study

Read by 1,520 founders

3. aiCarousels ($60K/year)

On the brink of losing his job, Fernando Pessagno, an Argentinian product designer, embarked on a 10-day #buildinpublic challenge to create aiCarousels.com, a tool that now generates $5,000 MRR, helping non-designers craft social media carousels using AI.

Is it profitable? Yes
What's the gross margin? 95%
How much money it makes: $60K/year
How much did it cost to start: $0

I Accidentally Built A SaaS in 10 Days & Quit My 9-5

Discover how an Argentinian product designer turned an accidental 10-day project into aiCarousels.com, an AI-powered social media carousel generator now boasting $5,000 in monthly recurring revenue (MRR), with minimal design skills and no formal programming education.

Read this case study

Read by 7,235 founders

Learn more about starting an AI-based business:

Where to start?

Need inspiration?

-> Other AI-based business success stories

Other resources

How much can you make with an AI-based business?

With a AI-based business, you can make an average of $335K revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $32. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within months.

How much does a AI-based business make a week?

Based on our data, average weekly revenue for a AI-based business ranges around $6.98K. As such, you could see monthly revenues of $27.9K.

To know if your AI-based business achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your AI-based business.

How much do AI-based businesses owners make?

The income of an AI-based business owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established AI-based business is about $6.98K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as an AI-based business owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Ai Based Business Profit Margins

Generally speaking, an AI-based business can expect profit margin of around %. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of an AI-based business, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, AI-based business owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, AI-based business owners can ensure long-term sustainability and profitability for their business.

Ai-based business owner salary

The salary of an AI-based business owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established AI-based business, in a prime position, might see an average weekly salary around the ballpark of .

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, based on many of our examples, a AI-based business may be a promising business to start - but the success of your AI-based business mostly depends on your effort and your approach.

If you focus on these, you'll have a much higher chance of a profitable AI-based business.