Eight years ago, Warren Buffett and Jamie Dimon published a joint op-ed in a major financial newspaper, warning that short-termism was threatening American businesses. They wrote, "In our experience, issuing quarterly earnings guidance often drives companies to obsess over short-term profits at the expense of long-term strategy, growth, and sustainability." The landscape has since shifted, with corporations facing entirely new challenges. Broadly speaking, executives are no longer prioritizing risk avoidance. According to a report released last Monday by a leadership research institute, Gartner forecasts that global IT spending will surge by 14.2% this year, driven by artificial intelligence. This figure provides a clear reflection of companies' willingness to invest in growth and place strategic bets.

When OpenAI launched ChatGPT in November 2022, it reshaped the business landscape in many ways, altering how CEOs and their organizations perceive risk. It's not that companies have become reckless, even though some market overinvestment is inevitable. The core change, I believe, is that corporate leaders today think more like venture capitalists than ever before. Focusing on the long term, businesses across various industries are not just adopting the algorithms and platforms of the tech sector but also absorbing its logic. The underlying principle of venture capital is this: accepting longer investment cycles and higher risks in pursuit of outsized returns from major technological breakthroughs. Many CEOs are now operating with this mindset.

In an interview with me last Friday, ServiceNow CEO Bill McDermott stated, "If a CEO can't continuously push the company to lead the market, what's the point of the role?" Leading the market often requires short-term sacrifices. Last Friday, ServiceNow shares were trading around $111, down nearly 43% from their 52-week high of $194.72. McDermott remarked, "Pursuing a bold strategy sometimes means enduring short-term performance pressure." He argued that the market's reassessment of SaaS companies due to fears of AI disruption has unfairly impacted ServiceNow. He firmly believes the company has unique fundamentals: as a platform business, it acts as a central control hub, interfacing with various legacy systems to enable safe AI model interactions across enterprise workflows. The company is also consistently expanding into areas like cybersecurity. "We never make acquisitions just to boost revenue. The company has maintained high growth for a long time, and we are pursuing more valuable opportunities," McDermott said, citing the 2020 acquisition of Element AI, co-founded by Turing Award winner Yoshua Bengio, and recent purchases of cybersecurity firms Armis and Veza.

"This doesn't mean the market shouldn't influence corporate strategy. On the contrary, the market has the final say," McDermott noted. "But it's clear now that sticking to old models only yields the same results. A great CEO is never satisfied with the status quo; vision must overcome fear." However, there is a key difference between CEOs and VCs in executing long-term visions: VCs can diversify risk across a portfolio of investments, while a CEO is fully committed to a single company. When they make major strategic decisions, the risk is highly concentrated, leaving very little room for error.