The AI Label Has a Shelf Life, and the SEC Is Watching

WeWork peaked at $47 billion in 2019 and filed for bankruptcy in 2023. Apple agreed to a $250 million settlement over how it marketed delayed features. Those are the receipts, says Tyler Perry, co-CEO of communications firm Mission North, and they explain why a company's AI story carries an expiration date.

Perry's argument, laid out in a new essay, is blunt: biotech and SaaS companies want to be seen as AI companies, health companies want to be seen as tech companies, and many are chasing a valuation multiple rather than building the underlying business. "Knowing capital flows to whoever carries the tag," he writes, comparing the rush to the dot-com era, when adding ".com" to a corporate name could trigger a speculative surge, and the later wave of blockchain rebrands.

Can narrative outrun execution?

To a point, Perry concedes. Investors, employees and reporters buy stories about frontier technology because a company building something that won't exist for years cannot point to a finished product. His example: Jensen Huang positioned NVIDIA not as a graphics card maker for gamers but as an AI computing company, years before ChatGPT made AI a household word. NVIDIA's story ran years ahead of the market, and the company built fast enough to catch it.

The catch is time. "Your story can run ahead of your business. That is what vision is for. But it can't run ahead forever," Perry writes. A story sets expectations. When the business misses them, the market responds with a fall-from-grace headline, a disengaged investor or a stalled deal.

Perry calls the distance between vision and execution "the gap," and he says its shelf life depends on how many people are watching. A young company in stealth mode gets room to maneuver. A well-known brand gets very little, because reporters, analysts and competitors track every claim. Once a company is public, people read the receipts: partnerships that were one-off pilots, R&D spending that never became a product. Wins extend the runway. Big claims with no wins shorten it.

How much tolerance is left?

Less than usual, according to the sources Perry cites. Pew Research found in mid-2023 that 52% of Americans were more concerned than excited about AI, while only 10% felt genuinely excited. Fast Company reported during the spring AI backlash that public trust is wavering while regulatory scrutiny grows. The SEC chair warned against "AI washing" — the high-tech version of greenwashing — in late 2023, and the agency brought its first two AI-washing cases against investment firms in March 2024. A steady stream of related cases has followed, per DLA Piper.

When the gap gets too wide, external forces close it. WeWork pitched a community movement while making its money renting office space; Fast Company asked in 2018 whether it was worth $40 billion or $3 billion, before the bankruptcy filing five years later. Apple's $250 million settlement covered how it marketed delayed features. "The more attention you have, the faster someone else closes the gap for you," Perry writes.

Repositioning or costume?

Perry draws a hard line: repositioning grounded in proof is strategy; without proof, it's a costume. His checklist for executives before claiming a new category:

• Who on the leadership team or advisory board has built this kind of business before?
• Which customers use the product today, and will they say so on the record?
• What would a skeptical reporter find after 10 minutes of searching the company or its execs in Google or an LLM?
• Could someone see how the product works without a human guiding the demo behind the scenes?
• If the word "AI" came out of the pitch deck, would there still be a business worth writing about?
• What is the next proof point, and when does it land?

The answers form a paper trail: people who validate the company, customer data that backs it up, and a clear account of the problem being solved. A costume has none of that, Perry writes. He also notes the gap can invert, with technology ahead of the story — then the job is helping the narrative catch up.

His closing benchmark comes from Bill Walsh, the coach who won three Super Bowls with the San Francisco 49ers and wrote The Score Takes Care of Itself: focus maniacally on preparation, details and quality, and the result follows. Perry's version for CEOs and communications leads is simpler. Check your paper trail before a reporter or a regulator does it for you, ask your team for proof and verify it yourself. "Storytelling is my business, so I'm telling you the story only goes so far. Mind the gap."