Inside the AI Graveyard: Why Humane, Relay and Character.ai Fell Apart

Inside the AI Graveyard: Why Humane, Relay and Character.ai Fell Apart
Payal Rana Fact Checked
StreakShot Newsroom • Investigative & Factual Reporting
Published: October 25, 2026 • 5 min read
Primary Source & Reference: news.google.com
Verified for factual accuracy
TechCrunch's running AI graveyard list, updated October 24, 2026, tracks major AI shutdowns including Relay, Humane and Character.ai. The pattern reveals why flashy AI demos keep failing as businesses.

A growing list of dead AI products shows that building something cool and building something that survives are two very different jobs.

TechCrunch has been keeping a running tally of AI startups and products that shut down, got sold off, or quietly pivoted away from their original promise, and the list keeps getting longer. First published on September 15, 2026 and updated again on October 24, 2026, the AI graveyard now includes Relay, Humane's AI Pin, Character.ai, Notion Mail and several other names that once looked like the future of the industry.

US Stocks Today: Nasdaq Jumps as SpaceX and Super Micro Spark AI Buying Frenzy

How Relay became the newest name in the AI graveyard

Relay was a five-year-old workflow automation company that let people run email and task automation through AI agents, basically trying to be an AI-powered Zapier. It shut down completely in August 2026. The reason was not that the product failed to work. It was that OpenAI, Google and other giant platforms started building the exact same kind of automation directly into tools people already use every day.

TechCrunch described the problem simply: Relay lost its reason to exist as a stand-alone product. That is the core tension running through the entire AI graveyard list. A small company proves an idea works, and then a much bigger company with far more users and far more cash just builds the same feature into something customers already have open on their screen.

AI Slop In Hobbyist Software Is Quietly Wearing Out Online Communities

Character.ai shows that popularity does not guarantee survival

Character.ai looked like one of the biggest consumer AI success stories around. Founded in 2021 by former Google researchers Noam Shazeer and Daniel De Freitas, the app let users chat with customizable bots built around fictional characters, celebrities and fan creations. It raised $150 million in 2023 at a $1 billion valuation, a number that made it one of the hottest AI startups anywhere.

Then in 2024, Google reportedly paid $2.7 billion to license Character.ai's technology and bring Shazeer and De Freitas back in-house, while the startup kept running without its founders. Reporting now places a bankruptcy filing roughly five years after the company launched. The company's technology turned out to be worth billions to Google, even as the independent business it came from could not hold together on its own.

Notion Mail and Huxe fell to changing habits, not just competitors

Notion Mail launched in April 2025 as an AI tool meant to organize inboxes and handle routine email work automatically. It did not die because a bigger company copied it. Notion found that users were increasingly turning to separate AI agents to manage their email instead of relying on the built-in tool. The shutdown was scheduled for September 22, 2026, making it a rare case where shifting user behavior, not direct competition, sealed a product's fate.

Huxe, built by former developers of Google's NotebookLM, turned written content into podcast-style audio. It shut down in May 2026 after larger platforms rolled out similar audio features to audiences that already numbered in the millions. Figgs AI followed a different but related path. The character creation platform drew more than a million users between 2023 and 2024, yet its own developers said keeping the service free had simply become too expensive to sustain.

Humane's AI Pin turned hardware ambition into a cautionary tale

Humane raised $230 million to build the AI Pin, a wearable meant to replace parts of how people use smartphones. The device struggled with basic performance from early reviews onward, and the trouble did not stop there. Humane later warned customers to stop using its charging case entirely because of a possible battery-fire risk, a serious safety issue layered on top of an already shaky product.

Humane shut down the AI Pin business in February 2025. HP stepped in and acquired most of the company's assets for $116 million. The episode made clear that AI hardware carries every normal risk of electronics and manufacturing, on top of whatever risk comes from the AI model itself. Microsoft's Recall feature, announced at Build 2024 to capture screenshots as a kind of photographic memory for your PC, ran into its own wall of privacy and security criticism that forced major delays and kept the feature under scrutiny long after launch.

The pattern behind every entry in the AI graveyard

Look across the whole list and a few repeating problems show up again and again. Big platforms like OpenAI, Google and Microsoft can absorb a smaller company's best feature and ship it to millions of existing users overnight. Running AI models, especially for video, audio or constant background agents, costs real money, and free products built on that cost structure tend to collapse once investor subsidies run dry. Hardware adds its own layer of risk, since a wearable or device has to work as reliably as any other gadget on the market. And sometimes a founder's technology becomes valuable to a giant company even while the original startup falls apart financially, as Character.ai's story shows.

TechCrunch has said the graveyard list will keep growing as more AI products close, get sold or quietly change direction. The lesson emerging from every entry so far is that flashy demos and fast user growth do not guarantee a company survives. What matters longer term is distribution nobody can easily copy, costs that make sense without a subsidy, and habits users actually stick with once the novelty fades.

Follow StreakShot on Google. Get insightful explainers, sharp opinions, and in-depth latest news on everything from geopolitics and technology to World News. Stay informed with the latest perspectives only on StreakShot.

Tags
AI graveyard failed AI startups Humane AI Pin Character.ai bankruptcy AI startup shutdowns
StreakShot Editorial Transparency & Fact-Checking Standards

StreakShot adheres to strict journalistic standards against spam, automated unverified claims, and misleading clickbait. This report was curated from verified public disclosures and primary sources, cross-checked for factual consistency, and analyzed to provide original reporting context and public interest value.

Fact Check: Verified Editorial Review: StreakShot Desk Published: Oct 25, 2026 Updated: Oct 25, 2026
First Published: Oct 25, 2026, 07:41:55 IST
Home / Technology / Inside the AI Graveyard: Why Humane, Relay and Character.ai Fell Apart

🔥 Trending Stories

Hebron Home Demolitions Leave 1,200 Palestinians Homeless After Attack
Hebron Home Demolitions Leave 1,200 Palestinians Homeless After Attack

Israeli forces demolished homes and businesses across Hebron after a checkpoint attack killed two soldiers. Around 1,200 Palestinians have already been displaced, with more at risk.

Oct 25, 2026
IDFC FIRST Bank Q2 FY27 Results: Profit Nearly Triples to ₹1,045 Crore
IDFC FIRST Bank Q2 FY27 Results: Profit Nearly Triples to ₹1,045 Crore

IDFC FIRST Bank's Q2 FY27 profit soared 196.5% to ₹1,045 crore, marking its second straight quarter above ₹1,000 crore. Loan assets and deposits both grew sharply.

Oct 25, 2026
Lovell Beach House: Why This 1926 Home Has No Bedrooms At All
Lovell Beach House: Why This 1926 Home Has No Bedrooms At All

The Lovell Beach House in Newport Beach was built without bedrooms, using sleeping porches instead to reflect Philip Lovell's wellness beliefs. Architect Rudolph Schindler turned those ideas into a modernist landmark.

Oct 25, 2026