Yes, startups can compete in the enterprise AI market. Recent developments from companies like Appian and Neeva indicate that there is a healthy number of participants aiming to build AI tools for large enterprises. While larger companies dominate the landscape, startups can carve out niches by focusing on specific needs and offering tailored solutions.

Appian is focusing on integrating new AI technologies into its software, emphasizing a private AI model that appeals to clients who prefer not to share their data. Their data fabric feature allows them to manage and analyze data across the enterprise without relocating it, which is a significant advantage in building AI services tailored to corporate needs.

Startups like Neeva face challenges such as user acquisition and competition from established players. Neeva initially struggled to attract users to its consumer search engine and had to pivot towards enterprise solutions that leverage LLMs. The rapid evolution of AI technology means that startups must continuously adapt to meet the changing demands of the market.