As the AI industry continues to grow at an unprecedented pace, private markets are witnessing a surge in investments, with some companies reaching unbelievable heights. According to UBS S&T, OpenAI has generated $10 billion in quarterly revenue, while other players like Thinking Machines Lab, Mercor, and others are attracting billions of dollars in funding. However, as the numbers get bigger, the need for evidence to support these claims is also increasing.

In the aftermath of the midterms, the focus has shifted from the hype to the actual implementation of AI. As the infrastructure required to support AI continues to grow, challenges are emerging. Power queues are growing, permitting is getting harder, and financing is becoming more selective. UBS Karl Keirstead’s industry checks suggest that while the build-out continues, only companies with the necessary power, capital, customers, and credibility will be able to deliver on their promises.

Despite these challenges, applied AI is moving ahead at a rapid pace. Companies like Kalepa are diving deep into insurance underwriting, Otter is exploring workplace workflows, and Primordial Labs is developing technology to control military robots. The frontier of AI is expanding, and startups are finding new and innovative ways to make money from it.

In the healthcare sector, private markets seem to indicate that nothing is off-limits. UBS Raahul Ramakrishnan has mapped $61.8 billion across 1,107 companies working to reshape various aspects of healthcare, including drug discovery, programmable biology, diagnostics, medtech, and care delivery. While plenty of technology is being funded, the real question is which of it will produce better outcomes and economics worth owning.