Dan Niles, founder of Niles Investment Management, warned that not every AI‑related company will secure funding this year. He told Romaine Bostick and Katie Greifeld on “The Close” that Google‑linked stocks have surged about 20% since late October, while parts of the open‑AI ecosystem have slipped roughly 20%.

The divergence reflects shifting investor appetite. Companies tied to Google’s massive infrastructure enjoy a safety net, whereas newer open‑AI ventures face higher valuation expectations and tighter capital markets. As venture funding tightens, only the most compelling use cases will attract fresh capital.

For investors, the split signals a need to reassess exposure. A concentrated bet on Google‑linked AI could yield upside, but the broader sector remains volatile. Diversifying across proven incumbents and select high‑growth challengers may balance risk and reward.

Watch for upcoming funding announcements from major AI players and regulatory updates that could reshape the capital flow. Earnings reports will test whether the 20% swings translate into sustainable growth or merely speculative momentum.