Billion-dollar valuations just turned AI companies into performance art
When AI startups get valued like unicorns before they've solved basic engineering problems, we're not investing in technology anymore.
The AI funding circus has officially lost the plot. We’re watching companies get billion-dollar valuations for what amounts to expensive wrappers around foundation models, whilst actual hard problems remain unsolved. This isn’t venture capital anymore, it’s just gambling with extra steps.
The performance gets more elaborate each round
Every funding announcement reads like the same mad lib. Revolutionary AI breakthrough. Transforming industries. Series B at astronomical valuations. Meanwhile, half these companies are burning cash on compute costs they can’t control, building on APIs they don’t own, solving problems that might disappear with the next model release.
The investors know this. The founders know this. Everyone’s pretending these valuations make sense whilst frantically hoping they can exit before the music stops.
Real engineering gets priced out
Here’s what actually happens when AI funding goes bananas. The companies doing serious infrastructure work, the ones building better training frameworks or solving distributed inference problems, get overlooked. Boring engineering doesn’t make TechCrunch headlines.
We end up with a market where the flashiest demos get the biggest cheques, whilst the foundational work that might actually matter gets bootstrapped by teams who couldn’t afford the Silicon Valley marketing machine.
The bubble will pop eventually. When it does, we’ll discover which companies were building real technology and which were just very expensive magic tricks.