Are We Pricing Tech Ambition or Inflating a Bubble?
Yesterday I read an excellent opinion piece by the great Richard Waters, the FT’s West Coast editor, who set out how the potential listings of SpaceX, OpenAI and Anthropic could trigger not only a record-breaking IPO cycle but a deeper shift in how markets value ambition, with investors increasingly backing companies whose narratives, missions and sense of inevitability outweigh traditional financial metrics
These three companies now dominate expectations for a new wave of technology. Each is raising capital at valuations that would have been unthinkable even two years ago. According to the Financial Times, SpaceX has explored private secondary sales that imply a valuation of around eight hundred billion dollars. OpenAI’s most recent share sale priced the company at roughly five hundred billion dollars, while Anthropic is reportedly seeking a valuation of approximately three hundred and fifty billion dollars.
These figures dwarf the previous record for a technology IPO. Over ten years ago, in 2014, Alibaba's IPO was the world's biggest at $25 billion, which now looks modest by comparison.
If all three companies were to go public within a similar window, they would reshape market expectations of how frontier technology firms are valued. They would also force boards, investors and policymakers to reconsider how narrative, reputation and strategic influence shape the economics of high-growth companies.
This is not just a financial story, but a story about perception. It is about how a small number of companies have mastered the art of framing their work in ways that attract vast capital, maintain investor confidence despite heavy losses and position themselves as critical infrastructure for the future global economy.
This raises a question that Europe, the UK and even some institutional investors in the United States have yet to answer. How can such valuations be sustained when profitability is distant, business models are evolving and regulatory scrutiny is intensifying?
Look at the valuations that AI companies are getting and which are generating concerns about a possible bubble.The rapid surge in AI investment has raised concerns that valuations are running ahead of reality. Private funding for generative AI reached more than 25 billion dollars in 2023, almost nine times the previous year, while Nvidia’s market value jumped from about 300 billion dollars in late 2022 to over 3 trillion dollars in 2024 on expectations alone.The IMF has cautioned that such concentrated capital flows could create structural vulnerabilities if revenue models fail to mature. These signals point to a growing risk that the pace of valuation inflation may be unsustainable
The answer lies less in the balance sheet and more in the construction of reputation, control of the narrative, and deliberate engagement with the people who influence capital allocation.
Rewriting valuation logic
Traditional measures of corporate health do not explain these valuations. Instead, companies such as OpenAI, Anthropic and SpaceX have reframed investor expectations by positioning themselves not as providers of products but as architects of the infrastructure that will underpin future industries. Equally, the move towards a more fragmented world is nudging countries to invest heavily in the necessary hardware, chips, data centres, and associated energy industries for AI and other technologies.
OpenAI’s revenue trajectory illustrates how the narrative has shifted to scale, not profit. Reporting by the Financial Times showed that the company is ending 2024 with an annualised revenue rate of around twenty billion dollars, supported by close to two gigawatts of compute capacity. It also plans to triple this capacity to between six and 6.5 gigawatts by the end of 2025. The company suggests revenue growth will follow this compute expansion, creating the expectation that scale itself guarantees long-term value. The exact monetisation timeline remains unclear, but the perception of inevitability has been successfully established.
Anthropic has followed a similar path. The company raised more than seven billion dollars from Amazon, Google and major venture funds across 2023 and 2024. Here too, the valuation rests not on near term profit but on an argument that the company is building a core component of the global intelligence layer.
SpaceX illustrates the same dynamic but in a different sector. The Space Report 2024 Q4 shows that global launch attempts hit a record 259 in 2024, driven largely by SpaceX, which carried out 152 launches and deployed almost 2,000 Starlink satellites. Starlink’s expanding footprint has become strategically significant for defence, humanitarian operations, telecommunications and the emerging AI ecosystem, which increasingly relies on satellite connectivity. Investors are not being asked to value a launch business. They are being asked to value an organisation with an expanding monopoly in a strategically essential sector.
These examples reveal the underlying logic. Each company positions itself as an infrastructure company, which, as a result, attracts a premium valuation because its relevance expands as the global economy evolves.
This is perception engineered into valuation.
Controlling the narrative and limiting scrutiny
A consistent pattern across these and other companies in these sectors is the extent of control they exert over both public and private narratives. Unlike publicly listed firms, they release selective data that amplifies their growth story while limiting exposure to information that might raise questions about sustainability.
This is particularly visible in OpenAI’s financial disclosures. Microsoft reported its share of OpenAI’s losses in a recent quarter as 4.1 billion dollars, which implied that OpenAI’s total losses may have reached approximately 12 billion dollars. In almost any other context, such losses would be reputationally damaging. In this case, the narrative reframes losses as investments in global infrastructure, much as telecom companies were valued during the early phases of broadband deployment.
This narrative control also insulates these companies from critique. Losses become a symbol of ambition. Large capital requirements become a sign of inevitability. Investors rarely challenge this because the companies anchor the conversation in the scale of their vision rather than the detail of their current financials.
This is not misinformation. It is a narrative discipline.
Trust, perception and elite influence
The most powerful perception strategy these firms use is their focus on elite stakeholder engagement. Their audiences are not consumers or journalists. Their audiences are sovereign wealth funds, pension funds, institutional investors, global allocators, national security agencies, regulators, and a small number of corporate investors or family offices with deep capital reserves.
This is a political economy of reputation. Investors place trust not only in the company but in the network of institutions that surround it.
SpaceX benefits from partnerships with NASA, the US Department of Defence and multiple intelligence agencies. OpenAI and Anthropic benefit from close alignment with Microsoft, Amazon and Google, whose reputational and disciplined financial weight and management reduces perceived investment risk.
From a strategic communications perspective, these companies apply a highly selective engagement model. They rarely participate in broad public conversations except where doing so supports their mission narrative. Instead, they invest in private briefings, secure roundtables, controlled investor communications and founder-led storytelling that positions them as irreplaceable.
The result is a reputational halo that few European companies are currently able to achieve.
Why this approach works in the United States but not in Europe
The gulf between the US and Europe is not only about capital. It is cultural. It is a case of US Hyper-Capitalism vs. European Prudence. I've been told this face-to-face by a senior person working within a Silicon Valley company. Someone who wants to see UK technology companies grow with confidence and secure the returns that US companies secure.
American markets accept and reward scale-first economics. Losses are tolerated when the potential gains appear transformational. Dual class shares and concentrated founder control are expected. The US regulatory environment creates a wide runway for experimentation and narrative-driven growth.
Europe and the UK do not operate this way. Institutional investors have capital, but are more conservative. They seek predictable cash flow, clearer business models and earlier visibility of profitability. Regulatory regimes are also more prescriptive and cautious. Founders are not routinely granted the autonomy or control that US markets accept. Equally, American companies grow because their government influences their global partners worldwide. American soft power sells well.
As a result, European companies struggle to construct the same type of perception architecture. Their valuations are constrained by caution, governance expectations, regulatory oversight and a culture of risk aversion that limits ambition and holds back growth. Again, somebody that I respect here in the UK said that, “we need to be more mercenary!” That is a statement that has stuck with me.
This helps explain why sovereign wealth funds in the Gulf direct far more capital to American tech companies than European ones. These funds are attracted to large, high-visibility, narrative-driven bets that signal participation in the next global technological wave. The US ecosystem consistently delivers that narrative. Europe does not.
At the same time, Sovereign Wealth Funds from the Gulf, Abu Dhabi, Qatar, Saudi Arabia and others, are mandated to diversify their national economies away from oil revenue by investing in global, future-facing technology. They are patient, strategic capital seeking exposure to frontier technologies like AI and space, aligning with their own national visions (e.g., Saudi Arabia's Vision 2030 and its AI build-out). Again, back in 2011, during one of my first visits to the region, I remember learning about the work being done at KAUST that now looks like a precursor to what has become a focus of a planned move away from carbon revenue dependency.
The strategic risks of narrative-driven valuations
The strategies used by SpaceX, OpenAI, Anthropic and others are powerful, but they also carry material risks.
One is over-reliance on founder identity. Elon Musk’s influence over SpaceX, Sam Altman’s central role at OpenAI and the culture surrounding Anthropic’s founders mean these companies are vulnerable to reputational shocks that stem from leadership behaviour. The governance crisis at OpenAI in 2023 demonstrated how quickly confidence can be tested when internal control structures are unclear.
Another risk lies in the gap between ambition and financial reality. None of these companies has proven a long-term revenue model that fully supports its valuation. Investors are betting on possibility, not certainty. If revenue fails to scale at the expected rate or if regulatory pressures delay deployment, the gap between narrative and performance may widen.
Revenue run-rate projections for these companies are dependent on a massive, perfectly executed infrastructure deployment and a sustained, perfect conversion of consumer/enterprise users into high-margin clients. Any delay in capacity deployment, a slowdown in market adoption, or a major technical misstep could cause the stock price to violently revert to traditional valuation metrics, triggering an immediate correction. These companies are at the edge of perception.
Regulation is also becoming unavoidable. The EU AI Act, US AI-related executive orders, export controls on advanced chips and present geopolitical tensions create uncertainty for AI firms. Space technology is equally exposed to national security regulations and shifting defence priorities.
The final risk is narrative overshoot. Uber’s experience is instructive here. The company repeatedly faced pressure to prove that scale could translate into sustainable profitability. It took until 2023 for Uber to report its first quarterly operating profit, nearly four years after its IPO and following prolonged share price volatility.
And we cannot ignore that the US is the only player and the only strategy in the world. China is using an open source model that is securing buying and admiration.
Narrative creates momentum, but if it outpaces financial evidence for too long, valuation corrections become inevitable.
Strategic lessons for leaders and investors
The story here is not about hype. It is about intentional narrative construction supported by strategic engagement and an ambitious, long-term framing of value creation.
There are lessons here for governments, start-ups, investors and incumbents.
Companies must take control of their story before the market defines it for them. They must understand which stakeholders truly shape their valuation and build trust with those people, not the entire public. They must articulate the mission in a way that strengthens credibility and attracts world-class talent. They must demonstrate progress through evidence. Above all, they must prepare for governance scrutiny that intensifies once they enter public markets.
As I have said many times before and share privately with clients, perception and reputation are no longer soft assets. They are an intangible source of capital. Perception, when constructed with discipline, can shape the trajectory of entire industries.
What these companies have shown is that valuation is now as much about narrative architecture as it is about financial results. The companies that master this will define the next decade of global growth.
