An interview with Rabbit CEO Jesse Lyu about the R1's design, collaborating with Teenage Engineering, why he didn't want to make a phone or an app, and more
Few people knew who Jesse Lyu was when he posted a video of himself to X, standing in front of a black backdrop in a black T-shirt, holding a bright orange gadget. X: @ctrlzee , @vkhosla , @altcap , @vkhosla , and @bharatvasan LinkedIn: Mark Wilson , JR Dawkins , Gregor Berkowitz , and Matthew Price, Ph.D. X: Mark Wilson / @ctrlzee : 50,000 presales later, the $200 Rabbit R1 has stolen the AI mindshare. Take a deep dive into its unconventional hardware in this interview with @rabbit_hmi's founder/CEO @jessechenglyu, who is eager to explain why it's not just an app https://www.fastcompany.com/ ... Vinod Khosla / @vkhosla : People view @rabbit_hmi as “hardware”. To me a new class of device will enable a new user experience & new model for how apps are used, making it “AI agent” based user centric, not app centric. A large change is coming in very low latency (not achievable for apps on an iPhone)... Brad Gerstner / @altcap : 100%. Speed. Speed. Speed. The elimination of latency will make the device disappear. When answers are whispered to u as fast as u think of the question - engagement will 💥. But latency makes devices feel like a chore. High performing models on the edge coming very soon... Vinod Khosla / @vkhosla : When Apple introduced the iPhone major criticism was it had no keyboard. As Steve Jobs said, the hardware enables the software. @rabbit_hmi is mostly software but the hardware enables user experiences like low latency conversations and the large action model allows one to... Bharat Vasan / @bharatvasan : I think @vkhosla is right on the low-latency voice ux. The 2 compelling use cases I see are real-time functional (search, translate) and augmented memory (what happened, what did i decide). Commerce (book a trip, buy tix at a concert) will prob take a while since the stakes are... LinkedIn: Mark Wilson : Apple is about to release its first headset, and yet, for the last two weeks, the internet's been abuzz about another product: the $200 Rabbit R1 by rabbit inc. A walkie talkie for AI. … JR Dawkins : This is a sleeper product for many outside of the tech world. When I saw this during CES week I thought, wow, someone was working on putting … Gregor Berkowitz : Rabit R1 is a cool product concept and an impressive video. The video is a clever hybrid of UI demo and CEO narration. … Matthew Price, Ph.D. : Great read Mark Wilson! I pre-ordered immediately. Teenage Engineering is a really interesting story. …
Context & Ripple Effects
Rabbit positioned the $200 R1 as a dedicated AI device rather than a phone or app, using its Teenage Engineering collaboration and reported 50,000 presales to make industrial design part of its market differentiation. The strategy sits squarely in the early launch of Rabbit’s standalone AI assistant, not a conventional smartphone refresh.
The product’s appeal depends on whether its specialized interface can deliver useful AI tasks more cleanly than software on an existing device. That question became more consequential as Rabbit paired the R1 with Perplexity-powered answers and a buyer subscription offer.
First-order effects
- Rabbit gains a clearer product narrative: the R1 is a purpose-built, design-led interface for AI interactions, with Teenage Engineering helping distinguish it from generic hardware.
- Buyers are being asked to adopt and carry a separate $200 device rather than download another app, raising the immediate bar for utility and reliability.
Second-order effects
- The R1’s positioning puts pressure on competing AI-device makers to demonstrate why dedicated hardware offers an advantage over a smartphone-based assistant.
- Its early demand signal makes the execution gap more visible: later hands-on coverage found the Rabbithole app unfinished, so the software experience becomes as important as the hardware’s visual identity.
Third-order effects
- AI hardware is likely to split between products that justify a new physical interface and products whose AI features remain distribution advantages for existing phones and apps.
- If standalone devices continue shipping before their software is mature, consumer trust may become a constraint on the category, as reflected in criticism of unfinished AI products sold at full price.
The trend: The R1 is an early test of the AI hardware strategy split: whether agent-like experiences create enough value to pull users beyond the smartphone.