AI Investment Bubble Concerns from OpenAI CEO Sam Altman

AI investment has seen a dramatic upsurge, prompting OpenAI CEO Sam Altman to express concerns regarding a potential bubble reminiscent of the dot-com crash from the late 1990s to early 2000s. During various events and media interactions, Altman drew parallels between the current excitement around AI startups and the former irrational enthusiasm for internet companies.

Investment Enthusiasm and Risks

Altman voiced his opinion that investors are currently experiencing an overzealous phase regarding AI. He emphasised that while AI technology is indeed transformative, the excessive hype and inflated valuations could endanger many companies. He highlighted that several AI startups are securing funding in the hundreds of millions based on little more than a concept, stating that high valuations do not ensure long-term viability.

Data Shows AI Funding Surge

The magnitude of this investment boom is illustrated by data from PitchBook, which reports that AI startups in the United States raised $104.3 billion in the first half of 2025 alone. This figure nearly matches the total amount raised by all startups in 2024. This year, nearly two-thirds of venture capital has been allocated to AI firms, a noticeable increase from 49% last year.

Focus on Fundamentals

Altman urged both entrepreneurs and investors to concentrate on the fundamentals rather than the momentum of the market. He warned that businesses with unsustainable models are more likely to fail during market adjustments, reflecting on how intelligent individuals can become overly optimistic based on a kernel of truth.

OpenAI’s Rapid Expansion

In spite of apprehensions regarding market overheating, OpenAI is pursuing aggressive growth strategies. The company secured $40 billion in March, marking the largest funding round in private tech history, and achieving a valuation of $300 billion. Its flagship product, ChatGPT, now garners around 700 million weekly users, a fourfold increase from the previous year, making it the fifth most-visited site globally. Altman indicated that ChatGPT is on track to surpass Facebook and Instagram to claim the third position, following Google and YouTube.

Future Plans and Public Listing

To sustain this growth, OpenAI is set to invest trillions of dollars into computing infrastructure and the construction of datacentres over the upcoming years. While some economists may deem this strategy “crazy” or “reckless,” Altman asserted that the company is committed to moving forward. He also disclosed that OpenAI is crafting an innovative financial instrument to finance these ambitious projects.

Potential for Stock Market Listing

Looking towards the future, Altman suggested that an eventual public offering is likely. He acknowledged the need for OpenAI to go public someday while admitting he might not be the most suitable person to lead the company as a public entity.

The remarks highlight a prevailing tension within the AI sector: as technology advances at an unprecedented rate, there are growing concerns that the influx of capital may not be sustainable. For Altman, the difficulty lies in balancing swift growth with the discipline needed to avoid revisiting the miscalculations of prior technological booms.