A 'shakeout' in early-stage AI may be coming as VC money gets pickier on valuations

A close-up view of a hand poised to touch a bright LED screen displaying purple hues. Interactive digital infrastructure in urban environments. Technology integrated into everyday city experiences.Oscar Wong | Moment | Getty ImagesInvestors should focus on productivity growth in artificial-intelligence companies as valuations in some areas start to look excessive, experts said. "We are likely to see a shakeout as investors become much more demanding about where the technology creates genuine value and where it is simply a feature dressed up as a business," said Jakub Nytra, founding partner at venture capital firm Purple Ventures. He expects capital to become much more selective over the next six to 12 months.The AI boom continues to reshape markets. Investors have poured money into semiconductor companies beyond Nvidia, betting that the buildout of AI data centers will benefit a broader universe of chipmakers and infrastructure companies. That said, worries of a bubble persist, as firms ramp up on capex spending with no end in sight, and sky-high growth figures create questions about sustainability of the expansion."The next question is whether applications and end users generate ...