Hitting it big betting on startups in the AI era will be a lot harder, but Silicon Valley might not feel the worst of it
The article discusses the increasing difficulty of identifying successful AI startups despite the current investment boom. It highlights that while AI lowers the barrier to entry for founders, the market is becoming saturated, making high-return investments like Anthropic increasingly rare.
Why it matters
It provides a realistic perspective on the AI investment bubble, warning investors that the ease of building AI products does not guarantee financial success.
Anthropic cofounder and CEO Dario Amodei with Menlo Ventures partner Matt Murphy in 2024. Menlo Ventures This post originally appeared in the Business Insider Today newsletter. You can sign up for Business Insider's daily newsletter here . I wish I could have gotten in early on that company. With AI company valuations acting like rocketships, it's easy to play the "what if" game. The reality is the process isn't as simple as writing a check and watching your money multiply many times over. (Even if it might seem that way.) Take Anthropic. The AI giant, valued at $1.2 trillion in secondary markets , looks like a no-brainer investment now, but that wasn't always the case. Back in 2023, it wasn't generating revenue, didn't have a public model, and was far behind the behemoth that is OpenAI. The asking price? A $4.1 billion valuation.
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