The world's largest creator of billionaires today is an artificial intelligence (AI) company. “Looking back at the data for 100 years, I have never seen wealth created at this rate or scale,” said Andrew McAfee, MIT's lead researcher. “That's unprecedented.”
Similarly, Anysphere was valued at $9.9 billion in the June funding round, and a few weeks later, its valuation doubled to about $20 billion, becoming 25-year-old founder and CEO Michael Troel, a billionaire.
It is worth noting that much of the wealth created by AI remains bound by private companies, making it difficult for shareholders and founders to acquire cash at this stage, at least until the exit or public offering. Unlike the dot-com boom of the late 1990s, when corporate floods went public, today's AI startups can remain private for longer, thanks to stable funds from venture capital companies, sovereign wealth funds, family offices and other high-tech investors.
“People are in the same place who know how to find, fund and grow tech companies,” said McAfee, who is also co-director of MIT's initiative on the digital economy. “I've been hearing for 25 years that 'Silicon Valley is over' or elsewhere is 'New Silicon Valley'. However, Silicon Valley remains Silicon Valley. ”
The housing market reflects this continuing dominance. Last year, homes costing over $20 million were sold in San Francisco, according to Sotheby's International Realty. Rising urban rents, housing prices and demand are driven primarily by AI, indicating a sharp shift in cities that declined just a few years ago.
“This wave of AI is very geographically concentrated,” McAfee said. “All people are there who know how to build, fund and measure tech companies. Silicon Valley is still Silicon Valley.”
The enormous wealth created by AI can present challenges to traditional asset management companies. Simon Krinsky, a senior Pathstone executive and former managing director of Hall Capital Partners in San Francisco, said he is likely to follow a similar pattern to the newly wealthy Dot-Com Boom in the 1990s. Initially, DOT-COM billionaires and billionaires used liquidity and excess assets to invest in similar high-tech companies through networks, peers, or shared investors. Klinsky believes the same applies to AI billionaires. “Everyone was investing with friends in the same type of company that created wealth.”
However, ultra-rich AI founders will ultimately recognize the need for traditional, personalized services that only the asset management team can offer, such as tax planning, inheritance and real estate planning, philanthropic advice, or portfolio diversification. “After people were burning and hurting in the early 2000s, they began to realize the importance of diversification and often hired professional managers to protect them from themselves,” Klinsky said. “We are looking forward to similar trends as in the AI Group.”
