“It Looked Like a Sweatshop Skit”: AI Startup Optifye Faces Backlash for Tone-Deaf Launch Video

When Optifye.ai, a young San Francisco-based startup, released a demo of its AI-driven factory analytics tool in early March 2025, it probably wasn’t expecting to get ratio’d into PR crisis mode. But that's exactly what happened when its Y Combinator Demo Day video went viral for all the wrong reasons.

The video, which has since been taken down, featured two young founders casually standing on a factory floor while the software flagged a real worker—by name—for being “too slow.” The awkward attempt at showing off performance optimization immediately drew fire online. Critics slammed it as dystopian, tone-deaf, and exploitative. “It looked like a bad SNL sweatshop skit,” wrote one user on X (formerly Twitter). Others questioned why no one on the team thought twice before uploading a clip that felt more like worker surveillance than industrial innovation.

The blowback was swift. Y Combinator pulled the video from its platform, and Optifye quietly edited its product messaging, shifting the focus away from worker monitoring toward more general “shop floor inefficiencies.” In a statement, the company apologized, saying it “regretted the framing” of the demo and that it did not reflect its values.

Founded with the goal of making manufacturing more efficient, Optifye’s tech isn’t fundamentally problematic. Plenty of retail and manufacturing companies already use AI for productivity insights. But this misstep shows how framing, tone, and context matter—especially when your product touches on people’s livelihoods. The backlash has also reignited concerns over how AI tools are marketed and used in labor settings. The idea that software can monitor and potentially penalize workers in real-time raises alarm bells for advocates and labor watchdogs alike. As AI tools become more common in warehouses and supply chains, the line between efficiency and exploitation is increasingly blurred.

To their credit, Optifye hasn’t doubled down. The company has reportedly begun working with external advisors to better align its messaging with ethical AI practices. Still, the incident offers a clear reminder: in today’s climate, startups can't afford to treat workers as data points—even if that’s what the tech does under the hood. For a company still in its early days, the stumble wasn’t fatal. But it was loud. And in the AI-for-retail space, where trust is increasingly part of the product, being seen as the villain—however unintentionally—is a hard look to shake.