Redpoint Claims $1.8T Up for Grabs for AI Apps in New Report (www.upstartsmedia.com)

Venture firm Redpoint released the AI64 report, naming 64 AI application leaders and estimating a $1.8 trillion market opportunity for AI app startups — a figure it says is roughly what's needed for application-layer revenue to justify the hundreds of billions spent on AI infrastructure. The list mixes well-known unicorns and earlier-stage breakouts, with the cohort having raised roughly $12B and a median company age of three years. Redpoint highlights shifts in pricing (only 19% still price by seat, many use usage- or outcome-based models) and warns of froth: rapid revenue growth is common, but questions remain around stickiness, enterprise-scale adoption, and how app-layer margins will hold up given model costs. The report’s deep dive into Cursor shows why apps matter: launched two years ago, Cursor claims ~1M users, work with two‑thirds of the Fortune 1000, and crossed $500M ARR; it's reportedly seeking a $30B valuation. Cursor’s playbook mixes product-led growth (targeting “10x” engineers) with top-down enterprise engagement via technical AI advisors and “field engineers.” Key technical/operational metrics are being redefined — e.g., half-life of generated code and demonstrable developer speedups (20% to 2–6x) — while token‑based pricing and agent capabilities expose margins to LLM costs. The net implication: the app layer can unlock massive value, but durable moats will likely come from deep integration, human-in-the-loop services, and measurable quality improvements, not price competition alone.