Ep 376: Beware AI Is Quietly Killing These Online Business Models – Don’t Buy These, Unless… with Jaryd Krause

AI is not replacing online business completely at all. AI is making online businesses better, and we need to make these businesses that we’re acquiring better with AI and understand how to lean into the opportunity instead of running away from it.

There’s so much fear out there around acquiring online businesses. People are asking: Should I buy a content business? What businesses are going to be affected by AI? Where are the opportunities that I’m not seeing? Should I sit on my hands or lean in? What do I need to understand in this new AI landscape?

That’s what this podcast is about. There’s so much value here because we’re talking about the business models being affected, the tools changing the landscape, why they’re being affected, and which businesses are still valuable in this new AI environment. More importantly, we’re talking about how to identify opportunities instead of fear.

This is not a fear-mongering podcast. This is about how awesome AI can be for us right now and how it can make our lives and businesses better. Like every tool, there are downsides if you don’t know how to use it. But if you do know how to use it, AI becomes an absolutely massive advantage.

So enjoy the pod.

Hey, in a world where AI is freaking people out — where people are either running for the hills or bunkering down because of all the “AI is taking over” content online — this podcast is different.

This isn’t about panic. It’s about understanding what AI is doing to online businesses, income streams, jobs, and the way we operate, and then using that knowledge to our advantage instead of becoming dinosaurs or buying businesses that are heading toward zero value.

I had a great conversation with Hugh Guiney Rajan, who has done the opposite of what most people have done in the online business space since 2023. He’s been buying content websites that were absolutely obliterated by AI traffic and the Google Helpful Content Update, then turning them around into profitable businesses by building a successful holding company.

So the question isn’t: Should we avoid this opportunity? The question is: How do we see the opportunity?

Most buyers still do due diligence like it’s 2021. They review the P&L, check traffic, and follow the same old checklists. That stuff still matters — absolutely. But the online business world has changed dramatically.

Now, AI exposure needs to be part of your due diligence process.

Before you fall in love with a business, ask yourself:

Is the core value of this business going to be easily replaced by AI?

If so, how do you protect it? Or how do you use AI yourself before someone else does and takes over your domain or market?

That’s the question most buyers aren’t asking.

And in many cases, the answer is yes — AI can actually improve the business. In some cases, though, it’s a clear no.

Take Google search traffic, for example. It’s not what it used to be. Site valuations need to change to reflect that. This isn’t a prediction — it’s already happened since the 2023 Google Helpful Content Update.

A lot of blogging sites got crushed because Google changed search results with AI-generated overviews. Websites with weak, fluffy content lost huge amounts of traffic, even some with strong authority domains.

But there’s still an opportunity there.

You can buy these websites for a fraction of what they used to be worth, then diversify traffic sources instead of relying solely on Google. Lean into YouTube, newsletters, social media, TikTok, AI traffic, and LLM visibility.

That’s what smart operators have done since 2023, and they’ve absolutely crushed it.

But if you keep relying on what used to work, you’re going to get left behind.

Digital Trends is one example. Their Google clicks reportedly dropped massively after AI overviews rolled out. HubSpot — one of the best SEO companies on the planet — also lost a huge amount of organic traffic. Their CEO openly acknowledged that AI overviews are answering questions directly, so users no longer need to click through to websites.

That’s not just an SEO issue. It’s a dependency issue.

When buying businesses today, you have to avoid overreliance on a single traffic source.

If you’re buying a blog or content site, you need to look at its last 12 months of performance and ask:

Is traffic stable?

Has it declined?

Can I diversify distribution channels?

Can I build newsletters, memberships, or other monetization streams?

SEO is changing into GEO — Generative Engine Optimization.

The goal isn’t fear. It’s empowerment.

Now let’s talk about SaaS businesses.

SaaS has been hit hard. A lot of software companies are losing seats because AI is replacing repetitive workflows.

Businesses that once needed large teams using software platforms now need fewer people because AI handles much of the work.

This happened incredibly fast.

But not all SaaS businesses are dead.

You need to understand which ones are vulnerable and which ones are protected.

The software businesses most at risk are those built around repetitive workflows:

Task management

Basic reporting

Simple analytics

Standard documentation processes

Ask yourself:

Can an AI agent do this task for a fraction of the price?

If the answer is yes, then you need to rethink the valuation.

For example:

Why would someone pay $200/month for software if they can do the same thing with Claude or ChatGPT for $30/month?

That doesn’t automatically mean you run away. It means:

Buy the business cheaper

Adjust the pricing model

Create AI-powered tiers

Protect the customer base

Build defensibility

The SaaS businesses that will survive are the ones with:

Deep proprietary data

Unique integrations

Compliance systems

Strong workflows that can’t easily be replicated

That’s where the value is.

The same thing applies to digital agencies.

Traditional SEO and content agencies are under pressure because AI can now generate content quickly and cheaply.

Agencies need to evolve from:

SEO → GEO

Manual content production → AI-assisted workflows

Expensive retainers → efficient hybrid models

That doesn’t mean agencies are worthless. It means they need to adapt.

There’s still value in agencies that:

Use AI effectively

Keep humans in the loop

Provide strategic thinking

Offer real marketing expertise

Now, not every business model is under threat.

Some are incredibly AI-resistant.

E-commerce brands with real brand equity are holding up extremely well.

And by “brand equity,” I don’t mean generic Amazon private-label products from Alibaba.

I mean brands with:

Genuine customer loyalty

Thousands of authentic reviews

Repeat customers

Strong communities

Email lists

Defensible niches

AI cannot replicate:

Trust

Community

Genuine customer relationships

Loyal audiences

Strong brands

That’s where the real value is.

Membership businesses, communities, relationship-based brands, and businesses built on human connection are much more resilient.

People still want human interaction. They still want trust.

AI can assist, but it doesn’t replace genuine relationships.

And here’s the important part:

AI risk is not just a warning sign. It’s also a negotiation tool.

If you identify meaningful AI risk in a business, you can:

Negotiate a lower valuation

Structure earn-outs

Tie payments to future performance

Reduce your downside risk

Smart buyers are already doing this.

They’re not using AI risk to scare sellers. They’re using it to price deals correctly.

The three major online business categories are still:

Media businesses

SaaS businesses

E-commerce brands

None of them is disappearing completely.

Some businesses will get obliterated. Others will thrive.

Your job is to figure out which is which.

And honestly, one of the biggest opportunities right now is buying businesses that have been unfairly discounted because of AI fears.

Distressed does not mean worthless.

Sometimes it just means the previous owner couldn’t adapt.

That becomes your opportunity.

Here’s the exciting part:

Businesses using AI properly are seeing massive gains.

Take Klarna, for example. Their AI customer support assistant handled millions of conversations and dramatically reduced response times while maintaining customer satisfaction.

The same tools are available to smaller businesses now.

AI can:

Improve customer support

Reduce operational costs

Speed up software development

Improve marketing

Lower content production costs

Increase output dramatically

The opportunity isn’t just buying businesses.

The opportunity is buying businesses that:

Already have value

Already have loyal customers

Already have strong brands

…and then making them significantly more efficient using AI.

That’s where the leverage is.

So to sum all of this up:

AI is not replacing online business.

AI is making online businesses better.

The real question is:

How do we use AI to improve the businesses we acquire instead of fearing it?

If you sit around waiting to see what happens, you’ll probably be too late.

The operators who understand AI, reduce costs, improve efficiency, and reposition businesses are going to create enormous value.

That’s where the opportunity is.

You’ve still got:

Media companies

Software businesses

E-commerce brands

And the strongest businesses are the ones with:

Real communities

Strong brands

Human trust

Defensible value

AI-enhanced operations

That’s what you should be looking for.

I’m genuinely excited about where this space is going.

Let me know what you think. Hit reply, leave a comment, ask questions, share your fears — and I can create another podcast about it.

Hope you enjoyed the pod, and I’ll speak to you soon.