Tulips and LLMs

Are we in an AI bubble? It depends on how you define it.

Author

Malcolm Frank, CEO
August 25, 2025

Tulips and LLMs

Lately, a lot of us have been reminded of “the time of great happiness” (better known as the dot-com bubble).

I had a front-row seat. From 1997 to 1999 it was a joyride; in 2000 the wheels came off. The parallels to today are hard to miss. And yet we shouldn’t be afraid. The dot-com bust, in hindsight, was less a graveyard than a nursery. Yes, Webvan, Pets.com, and Toys.com all ended in tears. But the internet matured and birthed trillion-dollar enterprises (e.g., Amazon, Google) and created entire new sectors (e.g., Netflix, Uber). And it rewired global services.

AI is bigger than the Internet, and far more important. But, like 1999, no one knows how. The bets today are outsized, concentrated, and mostly wrong. They’ll burst, just as Pets.com did, because people are grafting old models onto new technology instead of asking the only real question: what does the new technology actually want?

Five years from now, the answers will look obvious. Today, they’re anything but. So yes, I’m bullish on the AI trade. But in the short run? There will be blood.

Is the AI bubble about to burst – and send the stock market into freefall?

Sam Altman says private company valuations are “insane.”  Public valuations, such as Palantir’s PE of 500+, aren’t supported by traditional metrics. Are things about to burst? 

$30 billion down the drain? MIT says 95% of companies see no returns from GenAI

Most AI use to date has been limited to helping individuals work faster rather than improving overall company performance. 

Wait, what? Meta is hitting pause on AI hiring after its poaching spree

The hiring freeze follows weeks of poaching more than 50 AI researchers and engineers from competitors.

Getting a job at PwC out of college will be a lot tougher. It plans to recruit a third fewer grads by 2028

The firm said “the rapid pace of technological change is reshaping how we work.” Reduced entry-level hiring is a trend across the professional services industry.

Amazon is betting on agents to win the AI race

Why Amazon AGI Labs chief David Luan thinks solving agents is the next “S-curve” for AI.

Nearly half of young adults have changed their career paths because of AI

Young adults entering the workforce are facing a new challenge that is increasing the attractiveness of blue-collar jobs: the rapid development of AI.

AI, layoffs, productivity and The Klarna Effect

Promises about AI replacing employees often don’t work out — and may not be such a hot idea.

Coinbase CEO explains why he fired engineers who didn’t try AI immediately

Those who didn’t leverage enterprise licenses for GitHub Copilot and Cursor got promptly fired. 

Case study: Four big enterprise lessons from Walmart’s AI security

The new game of Spy vs. Spy.

The two-step comes to TikTok: Shifts to AI moderation with mass layoffs

The move was immediately met with criticism from unions and online safety advocates. 

Agent of the week: Xbow

Automate vulnerability discovery and enhance security testing.

AI now matches prediction markets in forecasting real events, study finds

University of Chicago pits AI models against live prediction markets. Early results suggest machines can match, and sometimes beat, the wisdom of crowds.

Keeping humans in the loop

The standard advice of guaranteeing AI safety and accuracy is ensuring human oversight.  But even humans have their limits, especially as companies scale up AI deployments. 

YouTube secretly used AI to edit people's videos. The results could bend reality

YouTube made AI enhancements to videos without telling users or asking permission. As AI quietly mediates our world, what happens to our shared connection with real life?

And one more thing…

Hollywood's biggest AI debut? Las Vegas Sphere's “Wizard of Oz”

When "The Wizard of Oz at Sphere" opens at The Sphere on August 28th, audiences will experience the 1939 film classic in a way its creators probably never thought possible.

Reply

or to participate.