pavlov
2 days ago
Evidence that large VC rounds are getting very concentrated on AI (specifically the kind where you need to buy lots of NVIDIA gear).
Is this leaving good companies unfunded because they're not sufficiently "AI"?
goalieca
2 days ago
That’s my main concern with the bubble as well. The economy functions better with diversity. There are so many industries that could use funding outside of tech and some that could use funding with some new tech approaches.
Just the sheer size of investment into a single idea should worry people. Diversity is very important.
epistasis
2 days ago
I think it's crowding out investment in things like housing. And lack of housing is economically killing the entire next generation of workers.
andsoitis
2 days ago
> I think it's crowding out investment in things like housing.
In what way is building homes competing for the same dollars as investing in startups or in listed companies?
epistasis
2 days ago
In the same way that bonds compete for investment dollars that would go into the stock market. The stock market has been going up only for AI companies, meaning all the money is flowing there.
If AI didn't have the hype, those marginal investment dollars driving up AI stock prices, they'd be flowing in to other uses of the capital, some of which I believe would be far more productive.
andsoitis
2 days ago
That presupposes we want home building to be driven by investors who are looking to make the highest ROI.
Isn't the healthier option that people who want homes get them built? You don't need a general investor in that loop, except if we're talking bout "mass housing" but even then, those are generally property developers and they are unlikely to use those dollars for non-property development.
epistasis
2 days ago
That's an is/ought fallacy.
Most people don't want to be their own builder. All of society is set up in the US to prevent people who want a home from building their own, from the permitting to the financing to the actual contracting. Except for the very wealthy.
A good chunk of people, perhaps most, want a house close to jobs and shops and schools and parks and museums and all those sorts of amenities.
Specialization into the very difficulty job of designing, permitting, and constructing housing makes sense. Not only is it a difficult job requiring tons of knowledge that a random person neither cares about nor needs to know about, specialized builders are far far far more efficient at building housing, and getting more housing completed for less money.
I didn't presuppose that housing should be built based on ROI, it just is that way, due to the realities of housing construction. I do think we need a public builder, modeled specifically after Finland's housing builder, as they have figured out some really great ways. Such a public builder has several economic advantages: provides a competitive floor for the private for-profit builders, and perhaps just as importantly a public builder can operate during the bottom of the economic cycle, employing construction workers through the downturn and providing much needed housing through the downturn thereby shortening the economic downturn.
mistrial9
2 days ago
the US state of Texas does break the mold of that unfortunately accurate overview, I am told..
epistasis
2 days ago
I think Texas bucked the trend, because they did not try to remove profit from home building and in fact made it cheaper to build housing.
Homeowners and landlords profit from high housing prices, and in most economically productive metro areas local politics is controlled by homeowners and landlords. They therefore try to stop housing production, using sneaky and deceptive language like "taking the profits away from developers" which in turns mean that the landlords make even higher profits from unproductive scarcity.
That's just one of many factors of housing production, and in many places, high interest rates on loans, and high construction costs, are also barriers equivalent in cost to local permitting problems.
Subsidized construction loans, or lower interest rate mortgage loans only for the first owner of a new building might be one way to break out of the current environment. At least it's one of the very few levers that a government could have here, after fixing permitting to be fast, efficient, and cheap. Building a larger and more efficient construction workforce is hard and not easy for a government to stimulate, except through increasing the size of the construction market through other means, and then ensuring that there's a true market of builders rather than a monopoly.
jstanley
2 days ago
The only way people who want homes get them built without an ROI to an investor is if they pay for it themselves.
Providing ROI to investors is a good thing if you want people to invest in something, because it means common self-interest will ensure it gets done.
andsoitis
2 days ago
Do you have a solution that would steer people who would build homes but who are investing in AI?
And to zoom out, aren't there other things that are EVEN MORE important to invest in than building homes?
jstanley
2 days ago
People who want houses have to be willing to either pay more for them or pay higher mortgage rates, I don't know what else you want me to suggest?
Where else is investor ROI going to come from?
andsoitis
2 days ago
What I'm trying to say is what is your concrete plan to incentivize investment AWAY from AI and towards housing? You can't tell people they're not allowed to invest in the thing that they think is gonna make them the most money.
Put differently, it is easy to say "there should be more investment in X and more in Y" but it takes concrete incentives to change that behavior.
Fro example, if you have a 401(K) or some other investments, should YOU be forced to redirect that into housing?
jstanley
2 days ago
> what is your concrete plan to incentivize investment AWAY from AI and towards housing?
I don't have one and don't think trying to nudge people this way is a good thing to do.
> You can't tell people they're not allowed to invest in the thing that they think is gonna make them the most money.
Exactly.
> "there should be more investment in X and more in Y"
I'm not the one saying that, you are!
user
2 days ago
MisterMunchkin
2 days ago
Yeah when I see someone's slop project get a billion from YC for a product which clearly is going to flop, it sickens me. Imagine how much you could do with that kind of money. Everyone is funding total trash just to get on the AI bandwagon.
chippiewill
2 days ago
There's a reason why every pre-existing startup has been slapping AI all over their products - it's basically the only way to get funding at the moment.
I think this has been a phenomenon since VC became a thing, there's always been trends and fads - CEOs have had to chase them even when it doesn't make sense for the product.
I think this is the most wide-scale one I can personally recall (although I presume dotcom boom was similar), but I remember through the 2010s every database startup having to chase the same ball-game. Everyone was doing NoSQL, then everyone was doing analytics etc. Of course now all those companies have AI-native, vector-embedding, RAG, MPCs slapped all over their products.
sammorrowdrums
2 days ago
Anecdata but from my vantage this has been true for a decade, I imagine it is only more true today, but investors were nudging to add AI to products the entire time I’ve been in tech, and failure to do that was always flagged as a risk for funding rounds. Need to show “AI/ML in the pipeline” by the next funding round or x/y/z is out…
ChoGGi
2 days ago
I'm cancelling my blockchain toaster startup, anyone up for investing in my AI toaster (powered by Nvidia)?
aurareturn
2 days ago
Is this leaving good companies unfunded because they're not sufficiently "AI"?
I don't see how a pure SaaS company without any AI features can succeed in a big way in 2026.
talmr
2 days ago
Does everything need AI though?
I’m asking because I see so many products I am interested in using, but I have no interest in connecting my Gmail, Slack, or other tools to it.
I just want a software I can use for that purpose, and then move on.
Pre-AI most of the slack channel connectors turned into spam. We would relegate it to some alerts channel that nobody used or looked at and a systems manager would close it a year later.
If a piece of software is good at what it does, it will have a tab in my browser where it runs and I’ll check it occasionally.
I don’t know about you guys but I just like doing work that’s in front of me, and after completing it I like to move on to the next thing.
90% of integrations/connections just add noise, at least in my experience.
aurareturn
2 days ago
Does everything need AI though?
Take Asana for example. It raised a total of $453M. If the same idea tried to raise money in 2026, I don't think it would raise $1. You can clone Asana in a week with AI Agents.
talmr
2 days ago
That’s fair. I agree there.
I guess I meant more like apps for communication, or managing infrastructure.
I like having Slack like I said. I don’t like connecting 100s of things to Slack when 90% of them end up value-loss noise.
andsoitis
2 days ago
> Evidence that large VC rounds are getting very concentrated on AI (specifically the kind where you need to buy lots of NVIDIA gear).
The most recent $1B+ funding rounds:
Zipline - Nov 5 - $1.5B
HUMAIN - Nov 3 - $2.6B
Fal - Nov 3 - $1.3B
OpenAI - Oct 31 - $11B
Kalshi - Oct 29 - $1B
Legend2440
2 days ago
That's 3/5. Zipline is drone delivery and Kalshi is betting markets.
grey-area
2 days ago
Also evidence that Nvidia is funding its own customers and artificially boosting demand. What could possibly go wrong?
Ampersander
2 days ago
Do you have evidence that a non-AI company can be good?