Investment in artificial intelligence has become very frothy, but that doesn’t mean it’s just another tech fad like blockchain or the metaverse, veteran investors say.
Even if there’s a bubble forming, AI is still real, experts sayThe AI investment boom is “deja vu all over again” for veteran investors who lived through the dotcom, blockchain and metaverse bubbles, who say they are now seeing attempts from start-ups to cash in on artificial intelligence in ways that are “completely nuts”.The Australian Financial Review
Fears that there was a dotcom-style investment bubble forming around AI were amplified last week when French start-up Mistral AI reportedly received €105 million in seed funding, valuing the company at €240 million even though it has no products and only recently started hiring staff. Ironically, though, many of the start-ups cashing in on AI to inflate their value might actually see their long-term value undermined by AI, he warned.
“You might get a million users, but someone could start tomorrow and get a million users as well. There’s no differentiation so is differentiation going to be a pricing race to the bottom?” Mr Petre asked.“If, however, you have a scaled and differentiated data set that you’re training your algorithm on, then that’s where the Holy Grail is.”
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