On this episode I breakdown whether we're experiencing an AI bubble by examining arguments on both sides. I discuss how AI startups are receiving unprecedented funding despite potential economic weaknesses, while also acknowledging the genuine utility and adoption of AI technologies. I also share practical advice for founders navigating this landscape, emphasizing that fundamentals like user engagement and profitable pricing remain essential regardless of market conditions.

Timestamps:

00:00 - Intro

00:33 - Yes it's a bubble

07:06 - No it's not a bubble

10:31 How to play the AI Wave

14:26 - What happens in a bubble

15:07 - The benefits of a bubble

Key Points:

• The case for an AI bubble includes excessive hype around startups, inflated valuations (seed rounds of $20-30M), similar base models across companies, and questionable unit economics

• Arguments against a bubble include demonstrable utility in workflows, falling training and inference costs, increasing adoption rates, and development of new competitive moats

• Different strategies are recommended for founders depending on whether they believe it's a bubble or not

• Historical patterns show that even in bubbles, truly valuable companies emerge and thrive long-term

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