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TechCrunch Compiles a List of AI Projects Shut Down or Falling Far Short of Expectations, Including Relay Shutdown and Character.ai Bankruptcy

TechCrunch published an article on October 24, 2026, listing AI products and projects that have been shut down, pivoted, or fallen significantly short of expectations. The article uses Relay as an example: the AI workflow automation tool, positioned as a Zapier alternative, was shut down completely in August. The product allowed users to automate email and tasks with AI agents, but as OpenAI, Google and others integrated similar functions directly into their own platforms, the five-year-old independent product lost its reason for existing.

The article also mentioned that Character.ai filed for bankruptcy about five years after launch. On the OpenAI side, ChatGPT had once tried to be integrated into a “super app” (including Chat, Codex and Work modes), but after an update on July 9, it was rolled back because users criticized the interface as confusing; ChatGPT Atlas, an independent browser, was discontinued less than a year after launch on August 9, with its functions folded into ChatGPT; and the Sora video platform was shut down in March 2026 because of high operating costs and user retention problems. Apple’s Siri AI was repeatedly delayed after the release of Apple Intelligence in 2024, eventually appearing in the iOS 27 beta, and involved a $250 million settlement. Microsoft Recall was delayed by nearly a year because of privacy concerns.

The article cited S&P Global Market Intelligence data saying that about 42% of AI initiatives are ultimately abandoned by companies, due to reasons including insufficient funding, technical challenges, competition, difficulty scaling, or weak demand. The list also includes Humane AI Pin (which raised $230 million, with most of its assets acquired by HP for $116 million), Rabbit R1, Notion Mail, Yupp, Figgs AI and others.

Original sources:

  1. Title: The AI graveyard: a running list of projects and startups that didn't make it Publisher: TechCrunch (Lauren Forristal) Publication date: 2026-10-24 URL: https://techcrunch.com/2026/10/24/the-ai-graveyard-a-running-list-of-projects-and-startups-that-didnt-make-it/ Source type: media report Verification status: Relevant passages read for this extraction; accessed on 2026-10-25 Supporting content: Relay shutdown, OpenAI Atlas/Sora, Siri delays, 42% data, Humane and other cases.

  2. Title: Character.AI files for bankruptcy Publisher: The Verge Publication date: 2026-10-13 URL: https://www.theverge.com/ai-artificial-intelligence/1009802/character-ai-files-for-bankruptcy-disney Source type: media report Verification status: Relevant passages read for this extraction; accessed on 2026-10-25 Supporting content: Character.ai bankruptcy filing, Disney-related deal.

  3. Title: AI project failure rates are on the rise: report Publisher: Cybersecurity Dive (citing S&P Global) Publication date: 2025-03-18 URL: https://www.cybersecuritydive.com/news/AI-project-fail-data-SPGlobal/742768/ Source type: media report Verification status: Relevant passages read for this extraction; accessed on 2026-10-25 Supporting content: 42% of companies abandon most AI initiatives (2025 survey, up from 17% the year before).

ABAB AI Insight

TechCrunch positions the list as a record rather than a ranking. The Relay case shows that when large platforms build automation features in-house, the room for differentiation for independent workflow tools narrows. OpenAI’s decision to fold Atlas into ChatGPT and shut down Sora is a decision to bring resources from standalone products back into the main product.

Character.ai’s bankruptcy involves legal and operating pressure. The report says the company filed for Chapter 11 to pursue an asset sale, and Disney, as the opening bidder, offered $20 million for part of the intellectual property. As of the report, the process was still ongoing and the platform continued operating.

S&P Global data points to a rise in the share of companies abandoning most AI initiatives. The figure measures the share of initiatives that companies abandon in “most” cases, rather than the success rate of a single project, and its methodology differs from other surveys such as Gartner’s or MIT’s. The hardware cases (Humane, Rabbit) show that consumer AI devices face additional constraints in performance and demand fit.

This list does not constitute a final determination of any company’s survival or failure, nor does it predict the pace of future shutdowns. Future points to watch are the result of Character.ai’s sale, the extent to which large platforms continue integrating the functions of independent tools, and the survival status of other hardware or workflow products.

ABAB News · Cognition Laws

  1. When large platforms build features in-house, they can compress the room for independent products to exist on their own.

  2. Shutting down independent products and folding their functions into the main product is a recovery of resources rather than simple failure.

  3. The rising share of companies abandoning most AI initiatives measures the scope of abandonment rather than the success or failure of a single project.