Jeffrey Funk

Jeffrey Funk is the winner of the NTT DoCoMo Mobile Science Award and the author of six books including his most recent one: Unicorns, Hype and Bubbles: A Guide to Spotting, Avoiding and Exploiting Investment Bubbles In Tech.

Archives

Is Microsoft’s New AI System Better Than Doctors? Probably Not.

_{A critic notes that Microsoft’s AI system didn’t solve the problems, but merely repeated the solutions that it was trained on}_{Jeffrey Funk
July 3, 2025}

Trying to understand the rationale of big monopolists such as Microsoft and Google is often a fool’s errand.

The Job Market is Telling Us Something About AI and Jobs…

_{But it’s not telling us the same things as the AI hypesters are telling us}_{Jeffrey Funk and Gary Smith
July 1, 2025}

The job market for recent college grads may be warning us that participation trophies for college and ChatGPT use have long-run costs.

AI Productivity Hype: The New “Cargo Cult Science”?

_{Physicist Richard Feynman coined the term to describe imaginary scenarios for success based on simple misunderstanding of realities}_{Jeffrey Funk
June 18, 2025}

The tech sector can push AI hype that resembles cargo cult science to its investors because of changes in media resulting from 30 years of the internet.

AI’s Contradictory Impact on Productivity: Squeezing a Balloon

_{AI appears to give support workers a big revolution in productivity. But it is somewhat like a child squeezing a balloon; the air pushes out someplace else}_{Jeffrey Funk
May 26, 2025}

Individual workers may claim huge productivity gains for their work, ignoring the impact of AI on the work of downstream employees within the same process.

University Science War: Ideas vs “Dollars per Net Square Footage”

_{Katalin Karikó, obscure and mistreated at the University of Pennsylvania, won the Nobel Prize. Shouldn’t we have some questions?}_{Jeffrey Funk
April 11, 2025}

Karikó’s story, as outlined in her book, highlights a big problem with universities: ideas matter less than sheer numbers of papers published.

Today’s Startups Are Doing Much Worse Than Those of the Past

_{The percentage of startups profitable at IPO time has steadily declined since the 1980s and most valuable ones take longer to become profitable}_{Jeffrey Funk
March 17, 2025}

We should certainly stop making overly optimistic claims about America’s system of startups, science, and technology.

Why LLMs Are Not Boosting Productivity

_{If LLMs were as reliably useful as economist Tyler Cowen alleges, businesses would be using them to generate profits faster than LLMs generate text. They aren’t.}_{Jeffrey Funk and Gary Smith
March 6, 2025}

So far, AI is dragging down economic growth by diverting so much human talent and natural resources away from more productive uses.

Does Everyone Think We Should Exaggerate Scientific Advances?

_{Many “breakthroughs” reported breathlessly in media are nowhere close to resulting in usable products or services}_{Jeffrey Funk
February 24, 2025}

Companies, universities and almost everyone else hypes the latest advances while those who question the hype are told that they are the problem.

Unequal Profits: Why AI Needs Successful Applications

_{Readers may be surprised to learn that these widely touted AI advances are not making their developers much money}_{Jeffrey Funk
February 11, 2025}

In the short run this system is being propped up by the big tech players but for a stable future, it needs to be self-sustaining.

Do High AI Startup Valuations Mean Great Success, or Desperation?

_{The answer is important but is not as clear as we might think. First, let's look at the background}_{Jeffrey Funk
January 13, 2025}

Consider a recent news report: “Anthropic is in advanced talks to raise $2 billion in a deal that would value it at $60 billion, more than triple its valuation from a year ago” says the Wall Street Journal. Anthropic’s last venture capital (VC) funding round, less than two months ago, raised $2 billion, bringing its total funding to $9.6 billion. OpenAI had raised $6.6 billion, last October just a year after it raised $10 billion from Microsoft the previous year and just months after it also raised funds on the debt and secondary markets. So that $6.6 billion round was the largest VC funding round ever, a little larger than the $6 billion that Elon Musk’s generative AI startup, xAI, raised in 2023. It nearly doubled OpenAI’s valuation to $157 billion, and brought its …

The Promise of Artificial General Intelligence is Evaporating

_{Revenue from corporate adoption of AI continues to disappoint and, so far, pales in comparison to the revenue that sustained the dot-com bubble — until it didn’t}_{Jeffrey Funk and Gary Smith
December 5, 2024}

Recognition is growing that fundamental challenges make LLMs unreliable. Increasingly expensive scaling will likely hasten the popping of the AI bubble.

AI Adoption is Slowing Amidst the “Biggest Gamble in Business History”

_{Workers and companies aren't buying the AI hype}_{Jeffrey Funk
December 2, 2024}

In the case of AI, knowledge workers are trying to tell us something. They don’t like AI as much the top managers do, and their excitement is falling.

AI Pessimists vs True Believers: A Deepening Divide

_{There is a growing divide about AI even among AI experts but many of them like polarizing content, just as the consumers of political information do}_{Jeffrey Funk
November 4, 2024}

True believers don’t focus on short-term trends because they aren’t very positive. But short-term trends should be consistent with a long-term forecast.

No, the AI Bubble is Nothing Like the Dotcom Bubble

_{Don't listen to the tech bros on this one}_{Jeffrey Funk
September 17, 2024}

Michael Dell, founder of Dell Computers, said recently on LinkedIn: “The skepticism around AI’s ROI today feels a lot like the doubts people had about the internet in its early days. Back then, no one could fully grasp how much the web would transform our lives, and now AI is on the same path. Yes, it might be tough to measure immediate returns, but if history teaches us anything, it’s that game-changing technologies take time to show their true impact. By embracing AI, we’re not just adopting a tool — we’re investing in a future where human potential gets a major boost, and new opportunities are unlocked. Just like the internet became the foundation of our digital world, AI has the potential to do the same, when we approach it with the same optimism and …

A Sloppy “AI Scientist” Could Make the Science Crisis Much Worse

_{A research team claims to have developed the AI Scientist that “generates novel research ideas, writes code, executes experiments ...” Really?}_{Jeffrey Funk and Gary Smith
August 29, 2024}

It continues to astonish us how easily people can be persuaded that LLMs (chatbots) can do our thinking for us

AI Increased the Market Cap of the Magnificent Seven by $10 Trillion. Will it last?

_{AI is here to stay, just not in these insanely high share prices}_{Jeffrey Funk
August 22, 2024}

Are the benefits from generative AI really hundreds of times higher than those from Microsoft Office?

Are We Close to Peak AI Hype?

_{Outrageous statements are proliferating.}_{Jeffrey Funk
July 12, 2024}

Sanity might be about ready to return to the market. Just maybe, we have reached peak hype.

Musk and LeCun Have a Superficial Debate About Science

_{What would have been a better debate?}_{Jeffrey Funk
June 24, 2024}

Elon Musk tweeted the following: “Join xAI if you believe in our mission of understanding the universe, which requires maximally rigorous pursuit of the truth, without regard to popularity or political correctness.” Yann LeCun, chief scientist at tech giant Meta, could not resist responding. Musk claims to “want a maximally rigorous pursuit of the truth but spews crazy-ass conspiracy theories on his own social platform.” It escalated quickly, with Musk questioning what science LeCun had done in the past five years, and LeCun replying: “Over 80 technical papers published since January 2022. What about you?” LeCun then said: “If you do research and don’t publish, it’s not science”. So the most successful engineer over the last ten years criticizes academic …

Hype Distracts AI Engineers from Real Work

_{Who is going to solve AI's actual problems?}_{Jeffrey Funk
May 22, 2024}

One reason there wasn’t an emphasis on reducing hallucinations is because the problem is hard. Some argue that hallucinations are “baked into" AI chatbots.

Universities Should Prioritize Critical Thinking Over Large Language Models

_{It is doubtful that LLMs can generate novel ways to boost productivity}_{Jeffrey Funk and Gary Smith
April 23, 2024}

No matter how many words they train on and no matter how many human trainers correct their mistakes, they will continue to lack the critical thinking skills.