Cells employ a myriad of signaling circuits to detect environmental signals and drive specific gene expression responses. A common motif in these circuits is inducible auto-activation: a transcription factor that activates its own transcription upon activation by a ligand or by post-transcriptional modification. Examples range from the two-component signaling systems in bacteria and plants to the genetic circuits of animal viruses such as HIV. We here present a theoretical study of such circuits, based on analytical calculations, numerical computations, and simulation. Our results reveal several surprising characteristics. They show that auto-activation can drastically enhance the sensitivity of the circuits response to input signals: even without molecular cooperativity, an ultra-sensitive threshold response can be obtained. However, the increased sensitivity comes at a cost: auto-activation tends to severely slow down the speed of induction, a stochastic effect that was strongly underestimated by earlier deterministic models. This slow-induction effect again requires no molecular cooperativity and is intimately related to the bimodality recently observed in non-cooperative auto-activation circuits. These phenomena pose strong constraints on the use of auto-activation in signaling networks. To achieve both a high sensitivity and a rapid induction, an inducible auto-activation circuit is predicted to acquire low cooperativity and low fold-induction. Examples from Escherichia colis two-component signaling systems support these predictions.