Instinct Founder: AI Assistants Don't Need Standalone Apps, Annual Transaction Volume Exceeds $1B

Noah Shinn, founder of personal AI assistant startup Instinct, shared a series of contrarian views on AI assistant design and business models in a recent podcast interview.

Instinct, founded about a year ago, still operates by invitation and has no standalone app. Shinn believes the ideal AI assistant should let users interact via SMS, WhatsApp or email, without requiring a dedicated application.

He shared data showing that after about three weeks of use, around 40% of users are willing to provide their credit card information, and retention among users who have connected at least one piece of sensitive information is roughly 80%. This, he argues, creates a data flywheel: the more personal data users share, the better the AI understands them and the better the experience becomes.

Shinn also argued that AI products can have network effects. Future networks will connect not only people but also the agents behind them, allowing different users' AI assistants to coordinate schedules, arrange events, and complete cross-account tasks.

On monetization, he said Instinct's annualized transaction volume has exceeded $1 billion with just over 100,000 users, implying close to $10,000 in annual transactions per user. He envisions letting a billion users access the AI assistant for free, generating revenue by taking commissions from transactions the AI helps complete, rather than relying on advertising.

Shinn also acknowledged the challenge of compute costs, noting that he spends about 40% of his time on compute issues and that Instinct is using batch inference and lower-cost models to reduce expenses.