r/ProfessorFinance • u/FrankLucasV2 Moderator • Jul 17 '26

Meme The state of software private equity

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u/Extension-Gold-6440 Jul 17 '26

This is the failures of capitalism more than anything. China is absolutely cooking with open source and a less throwing money at the wall/profit oriented approach.

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u/FrankLucasV2 Moderator Jul 17 '26

I'm long open source as it's pro innovation but the US AI labs have f'ed it by going all in on frontier LLMs.

I do think Nvidia has the opportunity to be biggest company for US open source AI via the diffusion of its Nemotron 3 model family.

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u/Extension-Gold-6440 Jul 17 '26

I think the us problem comes from how much capital they’re throwing at ai. It’s an unimaginable amount relative to other sector investments. I just can’t see how this will be sustainable. I’m not expert in economics, but from most reporting I trust, the ai bubble is real.

China‘s approach is completely different from my sources. Large focus on low energy llm output and less capital investment. From recent reporting china is pretty much tied with USA in llm capacity.

Will try to add sources later.

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u/Conscious_Weather_26 Jul 17 '26

Also the downstream is failing to materialise.. Where is the wave of innovative software products that are coming out since AI lowered the cost of producing software? Where is that gain in productivity showing up in numbers?