Part 5/14:
Having experienced three major bubbles—biotech, housing, and the dot-com crash—the interviewer reflects on historical valuation dynamics. During the biotech bubble, hedge funds were aggressively funding university projects to jump ahead in drug development, exhibiting classic bubble behavior. Similarly, the housing bubble involved irrational lending and speculation.
In contrast, current AI valuations feel more measured. Market behavior is cautious, and widespread irrational exuberance is less apparent. AI companies are demonstrating real substance, which, during previous bubbles, was often missing or inflated beyond rational bounds.