Veteran technology investor Paul Wick argued on Sunday that parallels between the AI boom and the dot-com era do not justify fears of an imminent crash or sudden employment shock. Wick is the chief investor at Seligman Investments within Columbia Threadneedle Investments. Wick said in an interview that newly established internet businesses and extensive telecommunications network construction fueled the early-2000s boom. Wick identified similarities today, including substantial spending on AI data centers, higher interest rates and higher energy costs.
Wick said today's market lacks the rush of initial public offerings and dramatic one-day stock gains associated with the late-1990s speculative boom. Wick said markets anticipated cuts to information technology budgets by late 2000. However, Wick said enterprise AI spending still appears resilient and recent technology earnings have remained solid.
Anthropic's revenue growth provides another indication of strong demand. Anthropic's third-quarter revenue increased 45% from the preceding quarter to $16.8 billion. Anthropic recorded $11.6 billion in the preceding quarter and $4.7 billion in the first quarter. Wick viewed Nvidia's efforts to support the wider AI ecosystem as less concerning because Wick described Nvidia as "extraordinarily profitable."
Wick said investors should monitor whether customers select older models or develop systems internally. Wick also warned investors to watch for pricing pressure as open-source alternatives become more widespread. Former Google CEO Eric Schmidt argued that free models from China could attract users in lower-income markets even if Western laboratories continue developing more advanced models. Debt concerns have already affected some AI infrastructure companies. CoreWeave Inc. recently reached a 52-week low amid concerns about AI-related debt.
Wick described fears that AI will rapidly eliminate human work as a "little premature." Wick acknowledged uncertainty about changes to entry-level jobs. Wick said career guidance is changing as skilled trades, including electricians and HVAC technicians, experience "booming demand." Wick argued that those trades can offer an "incredibly good living" without a four-year degree.
Schmidt has said AI is not a bubble, citing Anthropic's rapidly increasing sales as evidence that customers genuinely want AI products. Schmidt said Anthropic's growth pace was more than twice Google's historical growth rate during Schmidt's leadership. Bloomberg reported that Schmidt owns about 1% of Anthropic. Bloomberg reported that the holding could be worth roughly $15 billion to $20 billion, depending on Anthropic's eventual valuation in an initial public offering.
AI Boom Compared to Dot-Com Era, but Crash Fears Overblown, Says Veteran Investor
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Summary
Investor sentiment remains cautiously optimistic as Paul Wick, chief investor at Seligman Investments, compares the AI boom to the dot-com era but downplays fears of a crash. Enterprise AI spending holds strong, with Anthropic reporting $16.8 billion in Q3 revenue and Nvidia showing solid profitability. Altcoins to watch may include those tied to AI infrastructure, though Wick warns of pricing pressure from open-source tools and debt risks at firms like CoreWeave Inc.
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