The DeepSet Advantage: Why This AI Infrastructure Company Waited 3 Years to Launch Their Commercial Product
When did you know it was the right time to launch your product? For AI infrastructure company DeepSet, the answer wasn’t about market signals or competitive pressures – it was about building deep understanding first. In a recent episode of Category Visionaries, founder Malte Pietsch shared why waiting three years to launch their commercial product became their greatest competitive advantage.
The Early Days: Building Against the Current “Back then when we actually started, no one talked about llms, few talked about nap back then,” Malte recalls of DeepSet’s early days. “And were in this early phase where it was with early signs that it comes easier to use these kind of transformer models.”
Instead of rushing to market with a half-baked product, DeepSet took a different approach. They started with services, using customer projects to develop deep market understanding before committing to product development.
The Strategic Learning Phase “Be close to your customers. So I think for us, this bootstrapping phase was incredibly valuable because we just learned so much about really pain points of these customers in various companies before we had anything,” Malte explains.
This patient approach allowed them to validate their assumptions and refine their product vision through real-world applications. While other companies were racing to launch products, DeepSet was building something potentially more valuable: market understanding.
The Two-Product Strategy After three years of learning, DeepSet emerged with not one but two products: Haystack, their open-source framework, and DeepSet Cloud, their commercial platform. This wasn’t an accident – it was a carefully orchestrated strategy.
“We more or less from day one, then thought, okay, what’s the commercial product like? What’s the business model that can really create here to have a sustainable business?” Malte shares. They studied successful open-source companies like Elastic and Databricks, crafting a strategy that balanced community growth with commercial development.
The Market Timing Advantage Their patient approach proved particularly valuable during the recent AI hype cycle. “Last year, I think that was where a lot of this noise happened, where so much new things became possible. So a lot of cool ideas, great ideas, exciting demos,” Malte reflects. “But I think at some point, if you don’t want to become hype and just a bubble, you need to show the value coming out of things.”
The Warning for Technical Founders Malte’s most pointed advice addresses a common pitfall among technical founders: “It’s very risky if you are a tech company, if you build a very deep tech product that you may sometimes focus too long on just the technology because you have this vision, you have this idea, you just need to build it, but then maybe you hit the market too late.”
The Future Vision Today, DeepSet’s patient approach appears prescient. “We are kind of in the middle of a huge industrial transformation where AI gets really embedded into almost every product, every process, and it’s really, I think, becoming this new generation of intelligent applications and processes.”
Their story offers several crucial lessons for deep tech founders:
- Market timing isn’t just about being early – it’s about being ready
- Customer understanding is more valuable than quick product launches
- Services can be a strategic tool for product development, not just revenue
- In deep tech, patience in product development can become a competitive advantage
For founders building in emerging technology markets, DeepSet’s journey suggests that sometimes the best way to win isn’t to be first to market – it’s to be first to deep understanding. Their story challenges the conventional wisdom about speed to market, suggesting that in deep tech, patient product development might be the fastest path to sustainable growth.