Answer extracted from the How I Invest with David Weisburd podcast — listen to the full episode below.
Why is the private technology market actually undervalued right now?
The private technology market has grown from $15–80 billion in 2008 to approximately $5 trillion today, yet artificial intelligence has only realistically disrupted one sector: coding. With the vast majority of AI revenue still concentrated in that single vertical, medicine, engineering, and physical automation remain largely untapped—creating enormous degrees of possibility for value creation ahead.
In 2008 and 2009, when Dr. V started his first company in the aftermath of the global financial crisis, the entire private technology market was worth roughly $15 to $80 billion. Facebook, the largest company at the time, commanded a market cap of only $15 to $20 billion. Fast forward to today and the picture is radically different: a private market now valued at approximately $5 trillion in aggregate.
Yet this remarkable expansion hasn't been matched by an equivalent broadening of AI's real-world impact. As Dr. V explains in the episode, most of the revenue generated by leading AI companies like Anthropic and OpenAI is derived from coding applications. The penetration of AI into medicine, engineering, or physical automation—sectors where the potential impact is arguably greater—remains minimal.
"The question is less whether AI can disrupt labor. The question is what kinds of labor get disrupted first."
V — Founder of a new venture fund and former Partner at Lightspeed Venture Partners, where he spent nearly a decade investing across technology and deep tech. Dr. V has been investing in venture capital for over a decade and maintains a disciplined approach to capital allocation, believing it is difficult to deliver consistent returns across multiple investment vehicles simultaneously.
This concentration of AI disruption in a single labor category—and the untapped potential in adjacent sectors—suggests the market is pricing in far less value than the data warrants. If AI eventually disrupts coding, medicine, engineering, and physical automation with the same force it has already shown in software development, the gap between today's $5 trillion private market valuation and actual value creation could be enormous.
The capital landscape reinforces this view. In 2008 and 2009, the top Silicon Valley venture funds were raising $500 million to $1 billion—sums that seemed extraordinary at the time. There was no mega-fund phenomenon, no SoftBank $100 billion Vision Fund. Today, major investment firms like Lightspeed, Andreessen Horowitz, Sequoia Capital, and Benchmark collectively command excess capital in the range of $50 to $70 billion. As discussed at length in this podcast, the entire market structure has reset in terms of capital scale and expected value creation.
The tools themselves provide concrete proof of AI's nascent state in labor disruption. Cursor and Claw, AI coding assistants, have demonstrated the ability to scale from highly sophisticated research-level code to basic systems implementation—a remarkable range of labor displacement. Yet analogous tools for medical diagnosis, structural engineering, or manufacturing automation remain far less mature or economically proven.
Understanding why the market appears undervalued requires separating hype from trajectory. A $5 trillion private market is larger than any market in history at this stage of technological disruption. But if even a fraction of the unmet potential in medicine, engineering, and automation is realized, the full scope of this opportunity is explored in the episode, where Dr. V details the capital efficiency metrics that support this thesis.
See also
How did Warren Buffett evolve his investment principles while maintaining discipline?
Warren Buffett said in 1986 he wouldn't invest in Europe because he didn't know the accounting, language, or laws, and the market was fragmented compared to the United States—showing how successful investors maintain geographic and thematic discipline over decades.
What investment discipline has allowed a boutique firm to maintain focus and consistently outperform for 30+ years?
Maintaining a clear screen about what you're good at and where your right to win is most important. For American Securities, this has always been U.S. small-cap value investing, enabling consistent outperformance by staying within their circle of competence.
How can triangulation improve hiring decisions and reduce bias?
Most people rely only on resumes and interviews, which contain implicit and real biases. Triangulation using standardized personality tests and third-party assessments provides a more objective, multi-angle view of candidate fit.