The Truth About The AI Bubble
YC partners Diana, Jared, and Harj break down 2025’s AI surprises: Anthropic overtook OpenAI as the top model among YC founders, and the AI economy has structurally stabilized.
- Anthropic surpassed OpenAI as the #1 API choice among YC Winter 2026 applicants; OpenAI was 90%+ just two years ago.
- Gemini climbed from 2-3% to ~23% in YC batch model preference; Jared switched to Gemini as his primary daily tool.
- Series-B AI companies now arbitrage models by swapping providers per task, using proprietary evals to pick winners per agent job.
- AI 2027 doomer report quietly revised its timeline; YC partners cite log-linear scaling laws and organizational inertia as natural brakes on fast takeoff.
- First-wave AI vertical companies like Harvey may have wasted double-digit % of capital on fine-tuning that conferred no durable moat.
- Post-Series A AI companies still hire full teams — rising customer expectations absorb all efficiency gains, keeping headcount roughly flat vs pre-AI.
- Gamma reached $100M ARR with 50 employees, cited as the new benchmark flex: revenue-per-employee over headcount.
- YC sees data center energy and land constraints driving serious investment in space-based compute and fusion energy startups like Zephyr Fusion.
2025-12-22 · Watch on YouTube
