14 'Second Wave' startups aiming to take the AI era beyond cost cutting

• Kylan Gibbs leads Inworld's Second Wave AI startup accelerator.
• AI startups such as Luvu, Status, and Particle try to move AI beyond its initial cost-cutting phase.
• Innovative AI apps redefine user engagement and immersive experiences.

Second Wave AI startups are trying to move beyond cost-cutting and use this technology to create brand-new experiences and generate new sources of revenue.

The concept is being supported by Kylan Gibbs, a former DeepMind product manager who now runs an AI startup called Inworld. His company has raised more than $100 million from investors including Microsoft, Intel, and Founders Fund.

In January, Gibbs launched a Second Wave AI startup accelerator to back up to 30 "Second Wave" AI startups — companies building new consumer experiences rather than bolting chatbots onto old workflows. Venture capital firms, including Khosla Ventures and Lightspeed Venture Partners, are involved, alongside leaders from OpenAI, Google, and Stripe. A demo day will take place in early March in San Francisco, and participants get intros to potential investors.

Gibbs shared some examples of these types of startups with Business Insider.

Luvu

Luvu is an AI-powered fitness app that acts as a highly personalized personal trainer, using generative AI to send tailored motivational messages and real-time workout feedback. Through computer vision and reinforcement learning, it verifies users' exercises, adapts to their behavior, and creates a continuous feedback loop designed to boost engagement and retention. Luvu raised a pre-seed round with a16z speedrun and a seed round with investors including Insiders Ventures.

Status

Status is an AI-powered social simulation game that lets users role-play in dynamic, AI-generated social media worlds, casting themselves as characters ranging from Hogwarts students to pro athletes. Powered by large language models, the app creates instant replies, evolving storylines, and even "aura scores" that grade interactions, turning open-ended AI responses into immersive, ever-changing gameplay. WishRoll, the startup behind Status, has raised more than $15 million in VC funding.

Particle

Particle is an AI-native news platform that uses AI embeddings and generative tools to connect reporting with the most relevant insights from sources, including long-form podcasts. By mapping relationships between transcripts and stories, it automatically surfaces curated clips and adds summaries and context, bringing the most relevant information directly to readers. Particle has raised more than $10 million from investors, including Lightspeed and Axel Springer, the owner of Business Insider.

Bible Chat

This is a consumer-facing "talk to the Bible" style app that lets users ask faith questions, request prayers, and explore scripture in a conversational interface, an example of AI being used to create an always-on, personalized spiritual guide rather than a back-office efficiency tool. Bible Chat raised about $14 million in funding from True Ventures and other investors last year.

Liven

Liven positions itself as a "self-discovery companion," blending mood tracking, habit-building tools, bite-sized courses, and an AI personal assistant named "Livie" that's meant to help users reflect, reframe, and stay consistent. It's more like a pocket coach than a productivity feature. Liven has raised a seed round.

Born

Born is building social AI companions designed to bring real people together, not replace them: its flagship product is Friends, an app where users raise and co-parent cute virtual pets (like Pengu), play mini-games, and build routines with friends. The startup has framed this as an antidote to isolating, purely one-on-one chatbot dynamics. Born has raised about $25 million from investors, including Tencent and Accel.

OtherHalf

OtherHalf pitches itself as an immersive companion experience: anime-inspired 3D characters with expressive body language and real-time voice interactions, aiming to feel more emotionally resonant than plain text chat. Azimov, the startup behind OtherHalf, is backed by a16z speedrun.

FlowGPT

FlowGPT is less a single app than a consumer "marketplace" and community hub where people share, discover, and remix prompts (and increasingly agent-like experiences) for models like ChatGPT. FlowGPT raised $10 million from Goodwater Capital and DCM in 2024.

Tolan

Tolan is a voice-first AI companion app built around animated alien "best friends," designed to feel caring and emotionally supportive, while also nudging users toward healthier boundaries (like putting the phone down). OpenAI has highlighted Tolan's focus on low-latency, voice-first interaction and "memory-driven personalities." Portola, the startup behind Tolan, raised $20 million in a Series A round led by Khosla Ventures last year.

Little Umbrella

Little Umbrella is an AI-powered social games studio aiming to blend party-game dynamics with generative AI, including titles designed for online communities, such as Discord. The startup raised $2 million in early 2025 from investors, including Zynga founder Mark Pincus.

Speak

Speak is an AI tutor app built around getting users to spoken fluency by practicing out loud, an approach that's closer to a personal conversation partner than a traditional gamified worksheet. In late 2024, Speakeasy Labs, the startup behind Speak, raised $78 million from investors including OpenAI, Accel, Khosla Ventures, and Y Combinator.

Higgsfield

Higgsfield is an AI video platform aimed at creators and marketers with tools for generating videos and effects from ideas, part of a broader consumer-first push to make cinematic content creation accessible without traditional production resources. Founded by the former head of generative AI at Snap, Higgsfield has raised $130 million as a valuation of more than $1 billion.

TalkPal

TalkPal markets a digital language teacher that supports dozens of languages and emphasizes conversation practice, using AI to simulate speaking scenarios, deliver feedback, and keep learners practicing on demand.

Promova

Promova is a large consumer language-learning platform that says it blends bite-sized lessons with AI tools and personalized plans, positioning itself as a more adaptive learning journey rather than a one-size-fits-all curriculum.

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