Based on recent developments I’m increasingly convinced we might be getting close to a peak in valuations of AI-related companies. Notable signals include
* OpenAI missing its 2025 revenue expectations which suggests demand or monetization is lagging the narrative a bit
* increasingly aggressive monetization across chatbots which probably won’t land as expected since willingness to pay for low quality AI output is still questionable
* ongoing tensions between OpenAI and Elon Musk adding noise and uncertainty around the space
* comments from Nvidia execs that in some cases AI is still more expensive than human labor
core setup:
* GTLB -if the AI hype cools off, coding may move back toward more normal development processes instead of constant AI augmentation
* TEAM - collaboration tools should still matter, but if companies move away from chatbot-heavy workflows and back to working with people directly, the AI upside may be less dramatic than expected
Some others, not my favourites:
* FVRR - the thesis here is that for many freelance tasks the cost of a human is still lower than AI, so the market may be pricing in too much disruption too early
* UPWK -similar story, although the platform may keep more relevance if companies keep hiring people for work that AI still cannot do cheaply or well enough
If you’re willing to take more risk:
* CHGG this is more of a damaged asset / restructuring type of idea, but if the AI disruption trade gets overextended there could still be some optionality around the business or the data side
What is your opinion?
Not financial advice.