Tech Markets Quarterly – Beware! The panic merchants are out in force!

Three months ago, we wrote that we were not particularly concerned about stock market valuations collapsing anytime soon. We believed that, despite relatively high equity multiples, the increasingly intertwined fates of the American political and technological elites would sustain the current momentum for a while longer.That is indeed what we saw, but in the run-up to Christmas, panic merchants are out in force, trying to scare investors away with the almost apocalyptic tone of their bubble narrative.While we remain largely unconvinced by their dire predictions, we acknowledge that there are genuine concerns looming on the horizon. In 2026, we will closely monitor how Big Tech companies plan to finance their massive CAPEX programs. Additionally, we will pay attention to efficiency gains in data centers, as energy remains a critical chokepoint for AI. Speed-to-market will be crucial, but suppliers who can deliver ‘more with less’ will ultimately outperform their peers over the long run.Meanwhile in the world of private equity, fundraising is down in the case of most vertical segments (coming off 2021 peaks), except for AI, which, having already surpassed in 2024 its 2021 record ($121bn vs. $119bn), has set a new record in 2025, with $214bn raised YTD, despite growing concerns about a potential AI bubble. The year was marked by monumental deals, including a record $40bn funding round for OpenAI, $15bn for Anthropic in November and $14.8bn for Scale AI in June.