Authored by Satyajit Das via NewIndiaExpress.com,
The sky-high valuations of space and AI firms today are similar to that of internet ventures before 2000. Herd instinct is leading promoters and investors, not financial and technological reality
Burning cash rapidly, with large unfunded commitments, space and AI businesses are all dependent on uncertain funding access (Express illustrations | Mandar Pardikar)
The listing of SpaceX and forthcoming artificial intelligence floats bear similarities to the lead-up to the 2000 dot-com crash, which resulted in losses of over $5 trillion.
Even survivors like Amazon, Microsoft, Cisco, Dell and eBay, which had sufficient cash to ride out the turmoil, suffered massive falls in share price that took years to recover.
Today, familiar mistakes around technology, investment approach, business models, valuation and oversight are being repeated. Like the actress Tallulah Bankhead, investors believe that if they have to live life again, they want to make the same mistakes—only sooner.
The dot-com boom was built around the internet, its enabling infrastructure and retail commercialisation as applications developed. Investors with little technical knowledge piled in, hoping for huge returns. Today’s focus is space and AI.
Take SpaceX, an unwieldy conglomeration of Starlink satellite operations, a space launch business, a controversial social media service, a struggling AI venture as well as plans for orbital dat
