Just Like The Dot-Com Era, Are We Seeing An AI Era Based More On Hype Than Substance When It Comes To Massive AI Startup Investment Rounds?

Something’s not sitting right with me lately when it comes to the recent gargantuan AI startup investment rounds and valuations.

Over the past few months, we’ve seen a string of headline-grabbing investments into AI startups — startups that, in many cases, don’t yet have a product or service, a clear value proposition, or even a go-to-market strategy. However, what they do have is well-known and highly regarded founders and for some reason, increasingly, that seems to be enough.

It’s starting to feel like we’ve seen this movie before.

Let’s start with Mira Murati.

In February 2025, the former CTO of OpenAI quietly launched a new venture called Thinking Machines Lab. By June 2025, just six months later, it closed a US$2 billion seed round at a staggering US$10 billion valuation.

No product or service. No customers. No roadmap that we’ve seen. Just a big idea — and an even bigger reputation as far as all things AI are concerned.

Murati, to be fair, helped steer some of OpenAI’s most visible breakthroughs. But this wasn’t a bet on a business. It was a bet on her.

Then there’s Ilya Sutskever, another OpenAI co-founder who left the company last year to launch Safe Superintelligence Inc. (SSI). Within months, SSI raised $1 billion at a $5 billion valuation. And by early this year, its valuation had reportedly ballooned to as much as $30 billion.

The company is still in stealth mode. No product or service. No users. Just a team of extremely credible minds and a mission to build safe, aligned superintelligence.

It’s telling that Meta tried to buy SSI and when that didn’t work, they tried to hire its CEO, Daniel Gross.

More recently, there’s the move that really made me stop and take notice: OpenAI’s $6.5 billion all-stock acquisition of io, the barely year-old hardware startup founded by legendary Apple designer Jony Ive.

At the time of acquisition, io had no product in market. It was operating with a small team spun out of LoveFrom, Jony Ive’s design firm, and was rumoured to be exploring AI-powered consumer hardware. The acquistion wasn’t about hardware. It wasn’t about customers. It was about reputation. The OpenAI–Ive combination is headline gold, whether or not anything ships. Jony Ive is after all the design genius behind some of Apple’s most iconic products such as the iPhone, the iPad and the Apple Watch so he knows a thing or two of what it takes to create the next big thing for consumers when it comes to technology offerings that disrupt the status quo.

Then, just over a week or so ago came Meta’s $14.3 billion investment in Scale AI, and acquiring a 49% of the data-labeling company and bringing its 28-year-old founder Alexandr Wang into Meta’s fold to help lead its superintelligence efforts. For all intents and purposes, this feels like an ‘acquihire’ which basically means buying a business so that you can absorb key team members into your core business. All this being said, Scale has a real business and is makig decent revenues.

So, all of this leads me to a question I can’t stop asking: are we watching the next wave of transformational AI platforms take shape — or are we simply reliving the dot-com bubble, dressed in the language of AI promise that we may as well call dot-AI. Its certainly starting to feel that way!

Back in 1999, all internet statups needed to raise millions was a pitch deck and a domain name. Business models came later — if they came at all. Many who remember this era convinced themselves it was the dawn of a new era or, ‘the new economy’ as they called it, and in many ways, it was. But then came the inevitable dot-com bust and finally business sanity prevailed.

However, after all the pain for of that period, what followed was the inexorable rise of Google, Facebook, Amazon, and others who are today’s ‘Big Tech’ market leaders and also major enablers of the AI era — built on hard lessons and real businesses. Not just the promise of a new digital economy.

That’s what feels familiar now.

We’re seeing billion-dollar companies formed around visionaries and researchers with undeniable track records. But vision or potential alone doesn’t scale. Talent doesn’t ship. At some point, even in AI, the product or service has to matter. The user has to matter. The economics have to make business sense.

So, are these AI startups building the future — or are they inflating an AI bubble around the promise of the yet to be seen future of all things digital as we know them?

Time will tell. But if history is any guide, the gap between hype and value has a way of correcting itself — often quite painfully.

What do you think?