The AI investment boom is accelerating, capital inflows are surging, valuations are climbing, and SPAC activity is resurfacing. In many ways, it resembles the exuberance of 2021, but the macroeconomic context is very different. With interest rates at 5% rather than zero, the environment demands more discipline, and success will depend on sustainable fundamentals rather than speculative hype.
The Big Tech Capex Continues to Surge
The launch of ChatGPT catalyzed a dramatic increase in capital expenditures by Big Tech. Consider the numbers:
Before 2023, firms such as Meta, Microsoft, Amazon, and Alphabet consistently expanded infrastructure, though at a measured pace.
After ChatGPT, capital expenditures soared to over $300 billion annually, with forecasts suggesting more than $500 billion by 2030.
This shift reflects more than cloud expansion. It is an AI-driven arms race where control over compute capacity—via data centers, GPUs, and custom silicon—defines competitive advantage.
The Return of The SPACs King
In financial markets, Chamath Palihapitiya—often referred to as the “SPAC King”—has reemerged withAmerican Exceptionalism Acquisition Corp., a $250 million vehicle targeting AI, defense, energy, and decentralized finance.
Chamath SPAC performance (% change from $10 NAV)
• $SOFI: +142% • $OPEN: –62% • $SPCE: –70% • $CLOV: –74% • $PROK: –75% • $AKLI: –96% (delisted)
Palihapitiya’s historical performance is uneven. SoFi (SOFI) has proven resilient, and OpenDoor (OPEN) has regained some traction, while other ventures have struggled. Nevertheless, SPACs tend to flourish when traditional IPO markets slow. They provide an alternate pathway to the public markets—often for firms with high burn rates in hardware, defense technology, or AI. While risky, these listings can establish important public comparables for valuation and provide liquidity to investors.
A Reality Check on AI Adoption
Despite the hype, evidence from MIT suggests that95% of corporate AI pilot projects are failing to achieve significant financial results. Many initiatives remain small-scale experiments that encounter organizational bottlenecks. Middle management struggles with integration, while executives continue to promote AI as a tool for cost reduction and revenue growth.
This is exactly why I’m so bullish on Vertical AI.
Large language models are powerful, but they can’t magically fix deep corporate problems. The challenges inside an enterprise are rarely just about missing technology. They’re about people, entrenched workflows, and messy, fragmented data that doesn’t neatly fit into an AI prompt.
That’s where Vertical AI shines. To succeed, you need more than a generalized model. You need a deep understanding of the industry, the nuance of its processes, and the ability to clean and structure data in a way that actually makes it usable. That combination of domain expertise plus tailored AI solutions is what will unlock real value.
We’re still so early in this wave. The companies that win in Vertical AI won’t just apply AI on top of existing problems—they’ll re-architect industries from the inside out, building systems that understand context, compliance, and complexity at a granular level. That’s the real opportunity ahead.
Between Speculation and Discipline
The current moment sits between the exuberance of 2021 and the retrenchment of 2022. As the Dark Knight observed:“The night is darkest just before the dawn.”
Several dynamics define this inflection point:
Capital expendituresare rising at historic levels.
SPACsare reappearing as financing vehicles.
Corporate AI adoptionremains uneven and immature.
https://x.com/PeterJ_Walker/status/1957142251232256383
The environment feels speculative, yet speculation can provide the liquidity and comparables needed to reignite capital formation. The critical reminder is that not every startup will succeed and not every experiment will scale. The path forward requires grounding in fundamentals and long-term vision. The exceptional outliers that endure will define the trajectory of the next decade.
This is why, even amid volatility and hype, committed investors continue to place capital—because within the noise lies the potential for transformative innovation.
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