Will ChatGPT repeat dot-com and crypto crashes?

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RAIN CEO Nithya Thadani joined “The Big Money Show” to discuss the rise of new AI technology ChatGPT and the various ways it can be used to benefit consumers.

The hype around ChatGPT has led some industry watchers to warn that artificial intelligence (AI) will bubble up and crash like the 2000 dot-com meltdown or the crypto meltdown.

Will the thirst for “the next big thing” drive investment in ChatGPT and other AI applications to unsustainable heights and a rapid collapse?

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The OpenAI and ChatGPT logos are seen in this illustration taken February 3, 2023. (Reuters/Dado Ruvic/Illustration / Reuters Photos)

Two experts say no.

Venture capitalist Jai Das told FOX Business that there is likely a mini bubble around AI language applications, but no bubble around AI.

Das is co-founder of Sapphire Ventures, a venture capital firm specializing in growth and expansion stage companies. He thinks public markets are more rational about AI than they were about cryptocurrency or electric vehicle startups.

Bill Haskell agrees. Innventure’s CEO was managing director of Internet Capital Group, a dot-com venture capital firm worth $60 billion at its peak. At the time, Haskell told FOX Business that “the money was free.”

“The market was in this frenzy. Everyone was jumping into everything they could. [initial public offerings] were a dime a dozen at the time.”

Haskell’s Innventure aims to build billion-dollar companies by acquiring and commercializing overlooked technologies from multinational corporations. He says institutional investors are cautious when investing in artificial intelligence.

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Large-scale hegemony

Chicago, Illinois – September 7. 2019: View of the new Google building in the West Loop, Fulton Market in downtown Chicago.

The involvement of hyperscalers such as Microsoft, Google and Chinese Baidu will influence investment decisions. Microsoft recently announced a new investment in OpenAI, the maker of ChatGPT, while Google rolled out its Bard AI service and Baidu unveiled a ChatGPT-style “Ernie Bot”.

“These guys have been working on this for a long, long time,” Haskell told FOX Business. “It won’t be long before there are 10 ChatGPTs all vying for the same users and space and who knows which one will rise to the top.”

Additionally, many AI applications will be built around or integrate with existing applications owned by hyperscalers, mitigating the demand for new productivity applications. Das cites Google Docs as an example. Integrating AI into Google Docs eliminates the need for a new AI-only document app.

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Haskell thinks the AI ​​market will grow in spurts until something clicks.

“What will make it work will be some sort of frivolous, consumer, social media thing,” he speculates.

Experts cite the Internet as an example. The Internet was primarily a messaging tool until browsers literally opened up the World Wide Web. “Once the browser entered, everyone’s eyes opened,” says Das.

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ChatGPT IPO?

A ChatGPT logo seen on a cellphone. (CFOTO/Future Publishing via Getty Images/Getty Images)

Das sees a strong pipeline of investment opportunities, primarily in middleware, the software that will drive AI to become better. He expects to see “hockey stick” growth in Series A and B funding in about a year, adding that it may be another 6-8 years before either of these companies becomes public.

Haskell, who has led several IPOs, says he wouldn’t be surprised if an AI software platform goes public this year. He notes that Chat GPT was recently valued at $29 billion on $80 million in revenue.

“I wouldn’t be surprised if you have a few that jump out, including ChatGPT. If they can get that kind of rating [$29 billion] in the public market, you might see that because they’re going to have to keep raising capital to scale the technology and that’s one way to do that.”

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Where is ChatGPT going?

Michael Burton-Straub, left, and Declan Lewis attempt to “find the bot” in Donnie Piercey’s classroom at Stonewall Elementary in Lexington, Ky., Monday, Feb. 6, 2023. (AP Photo/Timothy D. Easley/AP Images)

Haskell and Das believe ChatGPT’s long-term future lies in integrating it into other applications. However, ChatGPT will not replace humans.

“ChatGPT will live on, but will be integrated into many apps,” Das told FOX Business. “It’s very difficult for AI to replace human beings. It’s like a digital photograph.”

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Haskell uses the example of a self-driving car.

“There can definitely be an audible component to that. As you ride in an autonomous vehicle – giving it context about where you want to go and what you want to see – it will start to take decisions on your behalf based on an equitable approach limited input from you.

“It’s not going to be a fad. There are real meaningful applications for it. It’s hard to predict which ones will come out and dominate first.”

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Just two months after its launch, ChatGPT – which can generate articles, essays, jokes and even poetry in response to prompts – has been ranked as the fastest growing consumer app in history. . This prompted Google owner Alphabet Inc to plan its own chatbot service and use more artificial intelligence for its search engine.

Reuters contributed to this article.

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