Twenty-five percent of CEOs believe AI is a bubble, yet they're continuing to pour money into it anyway. It's the Emperor's New Clothes of tech: everyone sees the problem, but nobody wants to be the one who stops spending.
A new survey reported by TechSpot perfectly captures where we are in the AI hype cycle. CEOs know the valuations don't make sense, but they're more afraid of being left behind than of wasting money. I've seen this movie before with blockchain, IoT, and the metaverse. Spoiler: it doesn't end well.
Here's what's actually happening: no CEO wants to be the one who tells their board they're not investing in AI. Even if they think it's a bubble. Even if the ROI is questionable. Because the risk of being wrong—of missing the next platform shift—is worse than the risk of wasting millions on something that doesn't pan out.
During my startup days, I watched enterprise SaaS companies add blockchain to everything in 2017 and 2018. Not because blockchain solved any problems they had. Not because customers asked for it. But because every investor pitch deck needed to have "blockchain" somewhere in it or you weren't a serious company. AI is the new blockchain, except the technology actually works.
That's what makes this bubble different and more dangerous. Blockchain mostly didn't work for the use cases people claimed. AI actually does useful things—it's just that the useful things might not be worth what companies are paying for them. The technology is real; the economics are suspect.
Let's talk numbers. Companies are spending millions integrating AI features that users don't want, solving problems that don't exist, and replacing workflows that already worked fine. The pressure is coming from VCs who need to justify pouring billions into AI startups, which creates demand from enterprise customers, which justifies more VC investment. It's circular and it can't last.
The survey finding is fascinating because it reveals the disconnect between what CEOs believe privately and what they do publicly. One in four think it's a bubble—but I'd bet if you asked them anonymously, that number would be higher. Nobody wants to admit doubt in public because doubt is punished in markets that reward confidence.
