We're back from the holidays, and we've got a doozy of an episode. The stock market is betting everything on AI, but many organizations are still struggling to turn it into real results. So what’s actually going on?

In this episode of Early Adopter, Jess and Kyle welcome back Rich Welsh (founder, tech advisor, and VC investor) to unpack one of the biggest questions in tech right now: Is AI an overinflated bubble waiting to burst, or is capital simply flowing toward the people who know how to use it well?

From Nvidia-driven market concentration to why startups are often outpacing large enterprises, Rich breaks down where AI is delivering genuine value, where hype is distorting reality, and how founders and investors should be thinking about the next phase of adoption.

We go beyond the surface level takes to explore what happens when AI becomes business-critical, and what the risks are if expectations and reality don’t line up.

What you’ll learn:

• Rich’s buzzword of the year (hint: it’s not agentic)
• Why the most boring problems often make the best businesses
• How founders can avoid the AI hype trap heading into 2026
• Why some teams are shipping faster than ever (while others are completely stuck)
• What an AI “bubble” would actually mean for startups, investors, and everyday people

If AI underpins your operations and the market corrects, the impact won’t stop at valuations. It could affect funding, hiring, productivity....and everyone downstream.

Whether you’re a founder, investor, or AI-curious operator, this episode will help you separate signal from noise and make more intentional decisions about where (and how) to to embrace AI.

Early Adoptr Book Club:

If Anyone Builds It, Everyone Dies - https://ifanyonebuildsit.com/

The Infinite Retina - https://www.amazon.com/Infinite-Retina-Computing-technologies-revolution/dp/1838824049

00:00 What We've Been Up To

05:34 Is There an AI Bubble? Separating Hype From Reality

08:25 Why AI ROI Is So Hard to Measure from an Investor's Perspective

11:14 Why Startups Are Winning With AI While Big Companies Struggle

13:56 What an AI Market Crash Would Mean

16:48 AI in Entertainment: Real ROI vs Studio-Scale Hype

27:33 The Next Phase of AI in Media, Gaming, and World-Building

35:48 From Large Language Models to World Models: What Comes Next

39:47 The Real AI Bubble: Where Expectations Break Down

51:35 How Founders Should Use AI in 2026 (Capital-Efficient Strategies)

57:37 AI News of the Week: CES Roundup

01:02:30 AI Gone Wrong: Bunnies on the Rampage

01:05:23 Wrapping Up for the Week

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