Venture capital experts are warning that investors need to shift their focus toward productivity gains in artificial intelligence companies, as valuations in certain sectors begin showing signs of overheating.

Jakub Nitra, founding partner at venture capital firm Purple Ventures, said: "As investors become far more demanding about where technology is creating genuine value versus where it's merely packaging a feature as a business, we could see a major industry shakeout." He anticipates capital will become significantly more selective over the next six to 12 months.

The AI wave continues to reshape markets, with investors funneling money into semiconductor companies beyond Nvidia, betting that AI data center construction will benefit a broader range of chip makers and infrastructure firms. That said, bubble concerns persist as companies show no end in sight for capital expenditure, while ceiling-level high growth figures cast doubt on the sustainability of this expansion.

David Ng, co-founder and CEO of wealth management firm Arki Finance, noted: "The next question is whether application layers and end users can generate enough productivity, revenue, and cash flow to justify this investment."

Nitra pointed out that while AI has the capacity to transform the economy, not every company that writes "AI" into its business plan "deserves an extraordinarily high valuation." He added: "The real winners will be those using AI to solve high-cost, extremely complex problems." As an example, Nitra cited TASS Vision, a company in his portfolio that deploys edge AI and cameras to analyze customer movement patterns inside physical stores, providing retailers with actionable data to improve their operations.

Shane Chesson, founding partner at asset management firm Openspace Capital, believes that even if a bubble exists, it will ultimately yield some positive outcomes. "If the bubble does burst, it mainly hurts those who invested in inflated valuations driven by fear of missing out," he said. "But the infrastructure that has already been built will still be used and will prove transformative for many companies."