Goldman Sachs CEO David Solomon has said that investors have shifted decisively into “greed” mode as markets are set to test a fundraising wave for giant artificial intelligence (AI) companies. When asked whether markets can support a string of massive equity offerings from the upcoming IPOs of OpenAI, Anthropic and SpaceX, Solomon said that there is ample capital available for the deals.“There’s plenty of liquidity in the system if the world continues to remain as optimistic,” Solomon said, adding, “I know when I say this, and I’m pausing for a second to say it, it will get quoted but I think its definitely true and something to reflect on that We are definitely in a moment where there’s more greed than there is fear.”
Wealth and liquidity support fundraising
Solomon acknowledged that the fundraising wave is unprecedented in size, but argued that record levels of wealth and liquidity across markets support the activity. He also said gains generated by AI companies may create a self-reinforcing cycle as employees and investors recycle profits into new ventures.Greed can “turn into fear very quickly, but that doesn’t mean it will,” Solomon said, explaining, “Exuberance can go on for big periods of time. …There’s a good chance that we’re earlier in the cycle than later.”Solomon’s comments come as investors prepare for what is said to be of the busiest periods for equity issuance in years. The two leading AI model providers, as well as SpaceX, which includes Elon Musk’s AI company, could go public at trillion dollar-valuations just as other firms are seeking vast sums to fund data centres, chips and infrastructure. There have been questions about whether markets can absorb the supply. Solomon, whose bank is playing a key role in several of the deals, downplayed concerns, saying that Google-parent Alphabet’s recent stock performance after announcing plans for an $80 billion equity raise was proof that markets are still receptive to AI, he said.“The stock is trading very well. This is the first actual concrete data point for bringing something of this scale, and it’s encouraging,” Solomon said.
Leave a Reply