{"id":127195,"date":"2025-09-08T06:40:13","date_gmt":"2025-09-08T06:40:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/127195\/"},"modified":"2025-09-08T06:40:13","modified_gmt":"2025-09-08T06:40:13","slug":"koah-raises-5m-to-bring-ads-into-ai-apps","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/127195\/","title":{"rendered":"Koah raises $5M to bring ads into AI apps"},"content":{"rendered":"

How can startups and developers actually monetize their AI products? A startup called Koah<\/a>, which recently raised $5 million in seed funding, is betting that ads will be a big part of the answer.<\/p>\n

If you spend any time online, there\u2019s a good chance you\u2019ve seen plenty of ugly, AI-generated ads \u2014 but few to none when interacting with AI chatbots themselves. Koah co-founder and CEO Nic Baird argued that will inevitably change.<\/p>\n

\u201cOnce these things get outside San Francisco, there\u2019s only one way to make [them profitable] on a global scale,\u201d Baird told TechCrunch over Zoom. \u201cIt\u2019s happened time and time again.\u201d<\/p>\n

To be clear, Koah isn\u2019t trying to introduce advertising to ChatGPT. (That\u2019s probably something OpenAI will do for itself<\/a> one day.) Instead, it\u2019s focused on the \u201clong tail\u201d of apps that are built on top of the big models, including apps with a user base outside the United States.<\/p>\n

Baird suggested that when consumer AI products were first becoming popular, it made sense for them to focus on \u201cwealthier, prosumer\u201d users, and to monetize those users by converting some of them into paid subscriptions.<\/p>\n

But now, someone could build an AI app that reaches millions of users in Latin America, and those users are \u201cnot paying 20 dollars a month,\u201d Baird said. So the developer could struggle to bring in subscription revenue, but \u201cthey have the same inference costs as everyone else.\u201d<\/p>\n

\"AImage Credits:Koah<\/p>\n

Baird suggested that by successfully figuring out how to make advertising work in AI chats, Koah could actually unlock more potential for \u201cvibe coded\u201d apps that might otherwise be \u201ctoo expensive to operate at scale\u201d unless their creators raise VC funding.\u00a0<\/p>\n

Techcrunch event<\/p>\n

\n\t\t\t\t\t\t\t\t\tSan Francisco
\n\t\t\t\t\t\t\t\t\t\t\t\t\t|
\n\t\t\t\t\t\t\t\t\t\t\t\t\tOctober 27-29, 2025\n\t\t\t\t\t\t\t<\/p>\n

In fact, Koah is already serving ads in apps like AI assistant Luzia, parenting app Heal, student research tool Liner, and creative platform DeepAI. Its advertisers include UpWork, General Medicine, and Skillshare.<\/p>\n

These ads are marked as sponsored content, and they\u2019re supposed to appear at relevant moments in your chats. For example, if you asking for advice about startup business strategies, the app could show you an ad from UpWork offering to connect you with freelancers who could work with your company.<\/p>\n

When Koah talks to publishers, Baird said many of them believe that ads simply don\u2019t work in AI chats, while others have found limited success with AI offerings from older adtech companies like Admob and AppLovin.<\/p>\n

But Baird said Koah is 4 to 5 times more effective, delivering clickthrough rates of 7.5%, and with early partners earning $10,000 in their first 30 days on the platform. He added that Koah achieves all that while having less of a detrimental effect on user engagement \u2014 though his ultimate goal is for Koah ads to feel relevant enough that they actually improve engagement.<\/p>\n

\"\"Image Credits:Koah<\/p>\n

Koah\u2019s seed round was led by Forerunner, with participation from South Park Commons and AppLovin co-founder Andrew Karam.\u00a0<\/p>\n

Forerunner partner Nicole Johnson echoed many of Baird\u2019s points when discussing the investment over email. She said that when it comes to AI, monetization, is \u201cthe elephant in the room amongst builders and investors.\u201d And while the \u201cgoing standard for monetizing consumer AI services is subscription,\u201d focusing exclusively on subscriptions can \u201cquickly lead to fatigue and churn.\u201d<\/p>\n

\u201cMultiple revenue models in Consumer AI are inevitable, and if the past decades of internet services are any indicator, ads will play a major role,\u201d Johnson said. In her view, Koah is \u201cbuilding the essential monetization layer for consumer AI services.\u201d<\/p>\n

As for where AI chats fall in the larger advertising ecosystem, Baird and his team have found they represent the middle of the purchase funnel \u2014 somewhere between the awareness raising of an Instagram ad and the actual purchase that might be driven by ad in Google search.<\/p>\n

\u201cPeople are not transacting on AI \u2014 they\u2019re just not,\u201d Baird said. They might ask a chatbot for recommendations or product details, but then \u201cthey\u2019re going to Google to buy.\u201d So part of the challenge for Koah is figuring out the best ways to capture a user\u2019s \u201ccommercial intent.\u201d<\/p>\n

\u201cIt\u2019s not interesting to me to try to figure out, \u2018How do we show a display ad in AI?\u201d Baird said. Instead, he wants to understand, \u201cWhat is the user looking for and how do we give that to them?\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"How can startups and developers actually monetize their AI products? A startup called Koah, which recently raised $5…\n","protected":false},"author":2,"featured_media":127196,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[256,254,255,64,63,5459,88995,88996,105],"class_list":{"0":"post-127195","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-au","12":"tag-australia","13":"tag-forerunner","14":"tag-koah","15":"tag-nic-biard","16":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/127195","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=127195"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/127195\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/127196"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=127195"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=127195"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=127195"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}