When you think about the AI startup that is most likely to go bust if or when the AI bubble bursts, what is the first name that comes to mind? For attendees of a recent Silicon Valley conference, the answer was Perplexity.
The AI search startup led the list of companies most likely to fall amid the AI boom that many investors and stakeholders fear could be turning into a bubble. More surprisingly, OpenAI occupied the second position on that list that was compiled based on an informal survey conducted among attendees of the Cerebral Valley AI Summit in San Francisco, California, United States, last week.
The one-day founder-investor conference saw panels featuring executives from AI heavyweights such as Anthropic and xAI. As part of the survey conducted by organiser and independent journalist Eric Newcomer, more than 300 attendees at the conference were asked: Which billion-dollar AI startup would you bet against?
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This comes at a moment when many observers are scanning the market for signs of an AI bubble and trying to guess which major player might be the first to stumble. Earlier this month, Softbank said it has sold its $5.8 billion stake in Nvidia, considered to be a clear winner of the AI boom, a move which stirred fresh concerns about inflated valuations.Several critics have pointed out that stock prices of the tech giants have soared too high and too fast in the mania around AI, drawing comparisons to the 2000 dot-com bubble that ultimately burst.
Perplexity is one such startup that has raised back-to-back funding rounds with valuations touching $50 billion, as per Business Insider. In response to the survey at the Cerebral Valley Summit, Perplexity spokesman Jesse Dwyer was quoted as saying: “Geeze, it sounds more like the judgmental valley conference.”
OpenAI being second on the list of AI startups to bet against is also due to its ballooning valuation even as the ChatGPT-maker plans to spend trillions of dollars to build out data centres and AI infrastructure.
To be sure, both Perplexity and OpenAI also appeared in another survey carried out at the event that asked respondents which AI company they would bet on. Claude-maker Anthropic, who recently closed a new funding round at a $350 billion valuation, led that list.Story continues below this ad
Previously, OpenAI CEO Sam Altman said that he believes the AI market is real, but he also pointed out that it may still bring benefits. “When bubbles happen, smart people get overexcited about a kernel of truth,” Altman was quoted as saying by The Verge. “Are we in a phase where investors as a whole are overexcited about AI? My opinion is yes. Is AI the most important thing to happen in a very long time? My opinion is also yes,” he added.
However, Altman has strongly refuted that his company’s valuation is inflated. When asked on a recent podcast appearance about how OpenAI plans to pay for its massive spending commitments, Altman responded with some pushback.
“I just — enough. I think there are a lot of people who would love to buy OpenAI shares,” he said to Brad Gerstner, whose firm (Altimeter Capital) is an OpenAI investor.