By Tycho Ferrigni · June 30, 2025 · 3 min read
Every now and again you read something and it just resonates with you to your core. The author, Paul Hlivko, does an excellent job of describing what many of us see in the AI space. In some respects he’s of describing how AI FOMO that has seeped into the psyche of just about every tech reliant business. https://hbr.org/2025/06/the-ai-revolution-wont-happen-overnight
The desire to chase the AI “innovation” and leverage it to change/transform business has not been slowed down by the scope, breadth and risk associated with the undertaking. The fear of being left behind is forcing the collective technology industry to drift away from its roots of creating tangible value in an agile/incremental way. When AI prototypes fail to impress, today’s playbook mandates you simply invest more…knowing that success is right around the proverbial corner. These increased investments, coupled with the sizzle associated with the technology, has created a set of financial incentives that have seemingly (dangerously?) morphed into business financial commitments. The teams responsible for delivery are on hamster wheel being told to go ever faster in the hopes of automating roles and reducing costs… We’ve been here before. It does not end well.
There are absolutely things to be excited about the in the AI space. That said, excitement is not in and of itself something that merits billions of dollars of investment…there must be value. It can take years to transform excitement into value. Sometimes it takes decades. And sometimes it never happens. For reference, here is an article reposted by Yann LeCun on LinkedIn that spoke to the excitement of AI (LinkedIn) from 1988.
While I am almost certain that the AI space will generate value, I am not as sure as to when or where the benefits will be captured. I tend to believe that given the number of competitors and the nature of the innovations (lots of open source math), the solution space will ultimately be crowded with choices. Assuming there are choices and variations in quality, there will be variations in price…and a crowded field of products makes it harder to price to value as opposed to cost.
And if this does turn out to be a bit of a technology bubble, there will be a size-able over investment that will ultimately make these capabilities ubiquitous…helping consumers at the expense of investors.
So what does all of this mean? Chasing AI should probably not be priority number one for most companies. The risk of generating Clippy 2.0 is too high. Creating tangible incremental benefit for your customers is a much better use of your investment dollars in the near term.
