The generative AI boom fueled a surge of startups, but two once-hot business models—LLM wrappers and AI aggregators—are increasingly being viewed as cautionary tales.
Darren Mowry, head of Google’s global startup organization across Cloud, DeepMind, and Alphabet, warns that startups relying on these models have their “check engine light” on.
LLM wrappers are startups that layer a product or user interface on top of existing large language models like Claude, GPT, or Gemini to solve specific problems—for example, an AI tool to help students study.
“If you’re really just counting on the back-end model to do all the work and you’re almost white-labeling that model, the industry doesn’t have a lot of patience for that anymore,” Mowry said.
Startups that simply wrap an LLM without differentiation or intellectual property risk being overlooked. Mowry points to examples of deep-moat wrappers, such as Cursor, a GPT-powered coding assistant, and Harvey AI, a legal AI assistant.
AI aggregators, a subset of wrappers, provide a single interface to access multiple LLMs and often include monitoring, governance, or evaluation tools. Examples include Perplexity and OpenRouter. However, Mowry cautions new startups:
“Stay out of the aggregator business.”
Users increasingly demand built-in intellectual property that guides queries effectively, rather than just backend access to multiple models. As providers expand enterprise features themselves, aggregators face shrinking margins—mirroring the early cloud era when AWS resellers were squeezed out unless they offered real services like security or DevOps consulting.
Mowry is optimistic about developer platforms and vibe coding, citing strong growth in 2025 for startups such as Replit, Lovable, and Cursor. He also sees opportunity in direct-to-consumer tech, enabling film and TV students to leverage AI tools like Google’s Veo video generator.
Beyond AI, Mowry highlights biotech and climate tech as sectors with significant venture interest, where startups can extract value from massive datasets in ways that were previously impossible.
Topics: Generative AI, LLM Wrappers, AI Aggregators, Google Cloud, Startups, Developer Platforms, Biotech, Climate Tech, Venture Capital