The development firm behind the AI companion app Dot recently revealed that the service will officially shut down on October 5, with a grace period allowed for users to download their data. Introduced in 2024, Dot was designed to serve as an AI 'friend and confidant,' offering personalized guidance and emotional assistance to its users. Yet, the AI companion industry represents a considerable investment risk for small startups. As AI technology becomes increasingly prevalent, the issue of 'AI-induced psychosis' has surfaced, and AI chat applications are now subject to rigorous safety evaluations, with OpenAI currently embroiled in related legal battles. The founders of Dot did not directly confirm whether safety issues played a role in the decision to close, merely noting that divergent shared philosophies prompted their separation. Users have until October 5 to retrieve their personal data. Despite Dot's claim of having 'hundreds of thousands' of users, its iOS platform has only amassed 24,500 downloads, and no Android version exists. This shutdown underscores the numerous hurdles confronting the AI companion app market, such as safety regulations, viable business models, and mental health implications, necessitating a delicate equilibrium between innovation and accountability for companies.