How to spot non-infrastructure AI plays worth investing in

Lopez Research founder Maribel Lopez joins Market Catalysts host Julie Hyman to discuss Big Tech valuation concerns and to explain how investors can distinguish companies that are leveraging artificial intelligence (AI) and are worth investing in.

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Video Transcript

00:00 Speaker A

there is this need to prove that ROI and prove that success at the same time that you have these frothy valuations. So, at a time when there are these concerns about about the valuations, where should investors sort of be looking for um, fault lines if you will? Like what what should we be examining?

00:23 Speaker B

So I think the thing, this gets back to what we were talking about. If you're not going to be the person providing the infrastructure, then it's do you actually have a foothold in the organization where you can take AI, put it into your product and basically create a new category of services. So if you look at companies like Salesforce, they've done a good job of discussing how they can leverage AI to deliver into new markets, not just into the CRM category, but they're talking about in the HR category, right? Uh if you look at someone like SAP, they're actually defending ground, but they're using AI to defend that ground. So those fault lines are basically when you look at somebody building in AI, can you see their customer base actually adding additional money to say a subscription service for that. And if you can't, then you can say, well, that's a nice to have, but it's not going to be it's just going to be a cost for them. It's not going to be something that's going to drive future revenue growth for them.

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