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- 🧠 Alphabet stock downgraded over AI fears
🧠 Alphabet stock downgraded over AI fears
PLUS: Are AI VCs all talk?
Alan Buxbaum & Alex Valaitis
May 16, 2023
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Happy Tuesday Big Brain Fam,
Lots to get to today, so I’ll keep this intro short & sweet. Just a reminder to make sure you scroll to bottom of email daily to see new AI jobs and tools!
Today's AI spotlights:
Alphabet stock downgraded over AI fears 📉
Are AI VCs all talk? 🗣
AI and university admissions…what could go wrong? 📚
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📉 ALPHABET STOCK DOWNGRADED OVER AI FEARS
Look out stock investors, Alphabet just got a downgrade from Loop Capital. Why? Apparently, AI chatbots might have people forgetting about traditional search engines.
Loop analysts Rob Sanderson and Alan Gould have put a $118 target on Alphabet shares. That's a hair above its current price and quite a bit south of the $130 average analyst target. Cue sad trombone sound.
This is the first Alphabet downgrade since March 3rd, and it's not just about Microsoft's AI gains. No, they're worried about chatbots like ChatGPT stealing Google's thunder as the web's top doorman.
Even with the AI concerns, Alphabet is still one of the big boys, trailing only Apple, Microsoft, and Saudi Aramco in market cap. That's like being the fourth richest dude at a billionaires party.
Sanderson and Gould aren't completely bearish on Google. They acknowledge Google’s unmatched AI skills and potential to benefit from AI adoption. This sentiment aligns with a chorus of bullish analysts from Wall Street's finest.
And in another twist, these Loop guys upgraded Meta from hold to buy with a target of $320. That's like betting on the underdog at the last minute. Meta shares rallied more than 2% in Monday trading. So, let's grab the popcorn and see how this show unfolds.
🗣 ARE AI VCS ALL TALK?
VCs are all about AI these days, right? According some metrics, apparently not.
Despite the hype, AI investment has slipped into a coma, according to CB Insights.
AI startups raised a measly $5.4 billion in Q1 2023, a 66% drop from last year. And deal numbers? They're as flat as ever, dropping 37% to 554.
Matthew Marwick from CB Insights thinks some of this trend can be attributed to a hangover from 2021's investment binge.
But here's the twist. Marwick thinks the party isn't over, and what we're seeing right now is just the calm before the storm.
Economic conditions are making investors as skittish as a cat in a room full of rocking chairs. Generative AI might lure some back, but others are wary of getting caught in a gold rush.
Still, there's a silver lining. Regardless of Q1 data, valuations and round sizes are still looking juicy for AI startups.
This means that we can count on founders to continue chasing the AI rainbow for a pot of gold.
📚 AI AND UNIVERSITY ADMISSIONS…WHAT COULD GO WRONG?
Admissions offices are now dabbling in AI. There's no way this can get political, right?
Those paperwork-ridden, coffee-stained desks are now home to futuristic robots... sorta. They're using AI to review transcripts.
Why? Automating certain tasks can help speed up unnecessary backlogs.
Maryville University, for one, is exploring this new territory. Their new buddy, Sia (not the singer, sadly) from OneOrigin, is helping them out.
"It's not just about automation," says Phil Komarny, the university's chief innovation officer. "It's about shifting the IT philosophy from 'control' to 'community'."
Luckily, the experts are exercising caution. They're embracing AI, but they're not ready to let it run the show... yet.
As Melanie Gottlieb, executive director of AACRAO, puts it, "We're hearing about using it in very functional ways." So, AI in admissions: functional, but not yet revolutionary. Watch this space.
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