"Silicon Valley leaders have debated for months whether the AI boom is a bubble. Ben Horowitz says that debate misses what's really happening. In a wide-ranging discussion on "The A16z Show" on Tuesday, the cofounder of the VC firm Andreessen Horowitz said AI represents something larger than past tech waves - including the internet - and that the eye-popping valuations can't be understood without looking at what's actually happening underneath the surface."
"Bubble fears Skeptics, including OpenAI CEO Sam Altman, Microsoft cofounder Bill Gates, and hedge fund billionaire Ray Dalio, often point to how fast valuations have risen to predict a looming bubble. But Horowitz said that focusing on prices alone ignores a more important signal: demand. "One of the reasons why people are so worried about it being a bubble is, you know, the valuations have gone up so fast," he said. "But if you look at what's going on underneath in terms of the customer adoption, the revenue growth rates - we've never seen demand like this.""
AI is presented as a new computing platform larger than past technology waves, including the internet. Valuations have surged rapidly, but customer adoption and revenue growth have also increased at unprecedented rates. Focusing solely on valuations risks misreading the market because underlying demand metrics show strong and accelerating adoption. The expansive AI design space enables the creation of many new successful companies rather than concentrating success among only a few dominant winners. The simultaneous rapid rise in both valuations and demand creates unease even among experienced investors, reflecting a transformative market shift.
Read at Business Insider
Unable to calculate read time
Collection
[
|
...
]