Alchemy is all you need
NVIDIA’s market capitalization crosses the $2T mark. Sam Altman begins laying plans for a $7T global chip empire. The largest sovereign wealth funds compete to buy FTX’s Anthropic stake.
But in the last few months, we’ve heard of multiple generative AI and infrastructure companies stockpiling expensive GPUs, before struggling to find a use for them. Start-ups we know have been removing powerful frontier models from their tech stacks, in favor of small, open-source alternatives. And, of course, there are the fresh reports of frontier model providers that are struggling with revenue growth and margins.
This isn’t because ‘deep learning has hit a wall’ or that the technology is anything other than incredibly impressive. Instead, we believe that the following features can all be true:
There are also specific dynamics at play in the frontier model space that will likely prevent the market from correcting in the near future. These have the potential to impact the entire AI value chain, from the chipmakers through to investors and founders.
