OpenAI CEO Sam Altman says there's 'too much of an investor frenzy around AI in the short-term' in Silicon Valley
- Altman said there's too much short-term investor frenzy, and not enough long-term vision.
- "There's crazy stuff happening in Silicon Valley right now," the OpenAI CEO said.
OpenAI CEO Sam Altman thinks there's too much investor hype around artificial intelligence in Silicon Valley right now.
Altman has been on a world tour of late to meet with policymakers, developers and AI users, making appearances across Europe, in Israel and now India, where he recently sat down for an event hosted by the Indian newspaper, The Economic Times.
When asked about the investor AI frenzy, Altman didn't mince words.
"It's wildly overhyped in the short-term," Altman said. "There's crazy stuff happening in Silicon Valley right now."
But he added that the investor interest is "still underhyped in the long-term." That's because if the technology progresses as well as he and others think it could, there's no way to determine how valuable that technology will be.
"No one knows how to think about that, no one knows how to value that, but whatever they're thinking is probably too low," Altman said.
There's no doubt venture capitalists and other investors are closely looking at how to fund the next big thing in AI. OpenAI recently raised a round of funding via a share sale of $495 million, which valued the company at $27 billion to $29 billion.
AI startups are announcing new rounds of funding every week from VC firms large and small, like Andreessen Horowitz leading fundraises in startups like Pinecone and Character.AI and coleading investments in Hippocratic AI, Coactive, ElevenLabs, among others. Sequoia is also knee-deep in AI investing, backing companies like Harvey and Langchain, and issuing a rare call out to woo startup investors looking for funding.
Funding to generative AI startups alone has jumped 580% in the past three years, according to PitchBook data. In the first quarter of this year, those companies brought in about $1.7 billion of funding from investors, while that number was just $250 million in the same quarter in 2020.
There's so much AI startup funding activity that Y Combinator cofounder Paul Graham thinks that public stock market investors are missing out because there's so few options available there.
"Most of the good investments are still private," Graham wrote in a recent tweet.
Regarding OpenAI's training of the next version of ChatGPT, GPT-5, Altman said the company hasn't started working on it yet. That was in response to claims that the company had started work on the update in April, but stopped after those in the tech industry, including Elon Musk and AI experts, signed an open letter calling for a pause on training AI systems more powerful than GPT-4.
Altman said it takes a lot of time, people and resources to train these models and there wasn't a set timeframe for when OpenAI will release the next version of the chatbot.
"We have a lot of work to do before we're ready to go start that model," Altman said. "We're working on the new ideas that we think we need for it, but we're certainly not close to ready to start."