Fortune
Artificial Intelligence (AI) is undoubtedly a significant technological advancement, but after 25 years of navigating various technological revolutions, the current discourse surrounding AI has reached a point of exhaustion.
The dialogue around AI, particularly in executive meetings, investor presentations, and venture capital circles, has transitioned from being analytical to increasingly frantic. In my experience managing a fintech company, the prevailing hysteria diverges notably from the practical realities we face.
Having witnessed the rise of the internet, mobile technology, cryptocurrencies, blockchain technology, and cloud computing, I can attest that each shift held its own importance. However, the distinctions in how these technologies impact businesses are often overlooked in today’s conversations regarding AI.
A key question to consider is: "For any specific company or industry, is AI similar to the transformative nature of the internet or more akin to the operational efficiencies introduced by cloud computing?"
The internet fundamentally altered our lifestyles, communication methods, and business practices, necessitating a complete reinvention of many companies. Conversely, while cloud computing constituted a massive technological advancement that generated trillions of dollars in market value for its providers, it predominantly enhanced the existing efficiencies of operations without drastically altering underlying business models.
I've led organizations throughout both paradigms. Prior to adopting cloud technology, we incurred expenses related to data hosting, hardware acquisition, and continuous network management. It was operationally viable. By the time I founded Capitolis, cloud technology was established and instrumental in scaling our operations more effectively, yet the foundational business model remained unchanged. Decisions regarding this technological transition often reside with engineering leaders collaborating with CFOs and COOs, evaluating returns and trade-offs.
This same approach should be employed by businesses regarding AI.
The AI Reality Check
Certain businesses may experience a profound transformation or face significant risk due to AI advancements. For instance, I recently interacted with DoorDash's customer service, which appeared to utilize AI. The speed and accuracy of the service exceeded that typically provided by human agents. For such companies, the current excitement around AI may actually be understated. However, this scenario is not universal.
At Capitolis, we function as a tightly integrated B2B network within institutional finance. We do not anticipate being disrupted by AI in the near future. We are committed to investing substantial resources — hundreds of thousands of dollars annually — into AI integration throughout our organization. While we identify areas of operational efficiency, the returns on these investments remain unrealized.
In engineering, we are observing AI agents that facilitate code development, with the potential for a 25% increase in productivity over time. Given our team of approximately 100 developers, this improvement is significant. Yet, the critical inquiries persist: How does this compare with our other priorities? What is the timeline and associated costs? What projects might be postponed?
When one examines the actual return on investment (ROI), the outlook can be disheartening. A considerable portion of current AI expenditures for many companies is exploratory rather than transformative. This is acceptable, provided there is an acknowledgment of this reality.
The Noise Is the Problem
Listening to the most vocal proponents, one might believe that every organization teeters on the brink of disaster unless it rapidly repositions itself to embrace AI. This narrative dominates conferences, presentations, and discussions, overshadowing critical perspectives. Such framing can be misleading and counterproductive.
While AI-native enterprises demonstrate concrete potential and promise to deliver returns for their investors, not all established businesses are required to react as if AI poses an overwhelming threat. For a multitude of healthy, rapidly growing, and profitable enterprises, AI will resemble cloud computing more closely — a robust efficiency tool rather than an impetus for radical business restructuring.
It is essential to make strategic, ROI-driven decisions, free from external noise. Engaging with AI as if it is a pervasive existential threat is not a viable strategy. Instead, we need to cultivate a mindset characterized by realism and discipline. AI warrants serious consideration; however, the surrounding hysteria does not.
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