AS 10 startups hit US$1 trillion in value, Econet founder and chairperson Strive Masiyiwa raises red flags about AI ethics and Zimbabwe joins Africa’s AI strategy race.
Fear of an AI bubble rises
On Thursday, October 16th, the Financial Times led with an article titled Of Course It’s a Bubble.
The opening sentence sums up the theory: “Ten loss-making artificial intelligence start-ups have gained close to US$1 trillion in valuation over the past 12 months, an unprecedented increase that adds to fears about an inflating bubble in private markets that could spill over into the wider economy”.
Bubble is a period during which the prices of assets rise far above their intrinsic value, driven largely by excessive investor enthusiasm, speculation, and herd behaviour rather than fundamental economic factors.
Now, why is this a concern, and what does it have to do with you?
Well, Citigroup estimates that nearly half of the S&P 500 has medium-to-high AI exposure. In other words, if AI is a bubble and it bursts, your investments are likely to take a hit.
But here is one thing I have found about bubbles: they have a remarkable way of lasting longer than you anticipate. Below is a chart based on data from risk concern showing how long bubbles typically last?
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So perhaps, we are already in a bubble, but there is still some time to go, especially in Africa, where AI is just getting started.
Speaking of AI and Africa, Masiyiwa comes to mind and he made some really interesting comments last week.
Masiyiwa on Altman’s OpenAI
Masiyiwa questions the ethics of Sam Altman’s OpenAI? In a Facebook post on Thursday, Masiyiwa appeared to take aim at Sam Altman’s OpenAI.
Here are a few direct quotes from the post: “Being able to do something does not mean you should do it. Do the right thing, even whilst no one is watching.
“Some people think it is okay to proceed, provided it’s not against the law. But what if the law lags behind (has not yet caught up to new products), and no one but you knows the potential harm?
“Then what? I found myself reflecting on this many times recently. For example, a major model released a video generating platform that can be used to make video clips using image inputs of [real] people without their permission.
“Now the Internet is flooded with the stuff. Whilst high-profile people like me will be allowed to intervene and get them removed, or to ‘opt out’ … what about ordinary people?”
Now, he does not directly call out OpenAI in this post, but all the clues point to OpenAI’s new Sora platform, which was released recently and has faced similar criticism.
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