AI Is a Tool Designed to Outpace Institutional Investors & Accelerate VC-Scale Growth— Says OpenTI CEO

Jibril Mohamed Ahmed, Founder & CEO of OpenTI

In a detailed industry commentary published today, Jibril Mohamed Ahmed, CEO of OpenTI, wrote that artificial intelligence (AI) has emerged as a tool engineered to outpace traditional institutional investors — from private credit to private equity — while accelerating venture capital (VC)-scale growth across global markets.

“AI today is no longer primarily a productivity tool — it has become a strategic instrument that attracts capital and moves faster than risk-disciplined institutional capital,” Ahmed wrote.

Global venture capital data supports this observation. In 2025, AI startups secured approximately $192.7 billion in funding — representing over half of total global venture capital investment for the year 1.

Quarterly venture deployment remained consistently strong, often exceeding $100 billion per quarter, largely driven by AI deals and megadeals 2. According to Ahmed, “this reflects a structural reallocation of capital toward technologies optimized for rapid scaling.”

In contrast, institutional private credit — a core asset class for pensions, insurers, and sovereign funds — has grown steadily but more gradually. India’s private credit market reached about $9 billion in H1 2025, a 53% year-over-year increase, yet still modest compared with AI venture flows 3. Globally, private credit assets under management were estimated at roughly $1.5 trillion in 2024, with projections toward $3.5 trillion by 2028 — meaningful growth, but slower in velocity than AI venture deployment 4.

Ahmed noted that “private credit is structured around cash flow predictability and collateral, while AI venture capital flows are driven by growth potential and network effects.”

Institutional venture debt providers are also being outpaced. Many AI firms are choosing equity-heavy financing rather than structured debt. A notable example occurred in 2026, when AI lab Humans& raised $480 million at a $4.5 billion valuation in a seed round — an unusually large early-stage equity raise 5. Ahmed wrote that this reduces opportunities for institutional lenders and accelerates equity-led growth models.

Private equity is facing similar pressure. AI-driven valuation expectations have pushed deal pricing beyond traditional earnings-based benchmarks, leading some PE firms to slow or recalibrate tech investments 6. “Valuation discipline and AI growth narratives are increasingly in tension,” Ahmed wrote.

Despite record funding, enterprise AI adoption remains comparatively modest. Global enterprise AI spending reached approximately $19 billion in 2025, far below the scale of venture capital flowing into AI startups 7. Ahmed said this highlights the divergence between capital markets enthusiasm and measurable enterprise integration.

He also emphasized governance risks. A recent IBM study found 43% of organizations cite poor data quality as a major challenge, with around 25% reporting annual losses exceeding $5 million due to data issues — a material concern for AI systems reliant on data integrity8. Meanwhile, industry analysts have warned about “model collapse,” where AI systems trained on their own outputs degrade over time 9.

“These are not fringe issues,” Ahmed wrote. “They directly influence portfolio risk and long-term valuation integrity.”

Ahmed concluded that institutional investors — including pension funds, sovereign wealth funds, private credit managers, and PE firms — must evaluate AI not only as a technology but as a competitive force in capital allocation. Institutions, he wrote, should integrate AI dynamics into valuation models, risk analysis, and governance frameworks.

“AI is redefining how capital is scaled and captured,” Ahmed wrote. “Institutions that recognize AI’s role in capital allocation — not only operations — will lead the next era of markets.”