Meeker, an early investor in companies like Meta, Spotify, and Airbnb, told the Financial Times that AI will create “multiple companies worth $10 trillion” — and not all of them will be based in North America. “The wealth creation will be extraordinary. We’ve never had a five-billion-user market that was this easy to reach,” she added.
In a recent report, Meeker and others point out that US companies, such as OpenAI’s GPT and Google’s Gemini, leading the development of large language models (LLMs) are now facing rising training costs. At the same time, competition from players like DeepSeek has intensified.
“The business model is in flux,” Meeker wrote. “Smaller, cheaper models tailored for specific tasks are emerging, challenging the idea that one large, general-purpose LLM can do it all.”
While AI companies have enjoyed rise in revenues and stock prices, they face growing threats. New, more powerful chips and improved algorithms are lowering the cost of running AI models. This is helping competitors like DeepSeek launch models that are more affordable and efficient.
She goes on to underscore that, in the short term, these AI businesses are starting to look like commodity operations that burn through venture capital at a rapid pace. Despite the advances in the space, training the most advanced AI models is still extremely expensive. Costs have increased 2,400 times in the past eight years, making it nearly impossible for smaller players to compete. Only a few companies can afford to keep up, and even those lack a clear path to profitability.
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While lower prices and more model options benefit consumers, they create a tough environment for startups. To survive, these companies need deep funding and patient investors. Meeker compares their situation to companies like Uber, Amazon, and Tesla, which all spent heavily for years before turning a profit.ET reported earlier this week how several Indian startups may have to tap external funding to scale up their GenAI-based applications as AI companies such as OpenAI and Anthropic pause steep price cuts of their generative AI models.
Meeker rose to fame during her time at Morgan Stanley with bets like Google and Apple, earning the moniker “queen of the internet”. She joined venture capital firm Kleiner Perkins in 2010 and later co-founded her own firm, Bond, in 2019.