AI takes center stage in investment risk assessments
Jonathan Gray, president of investment giant Blackstone, warned that Wall Street investors “underestimate AI’s potential to make entire industries obsolete.” According to Financial Times, Gray said that understanding AI-related risks is now “number one” when assessing deals.
“I’ve told our credit and equity teams: put AI on the front pages of investment memos,” said Gray. While he acknowledged speculative enthusiasm reminiscent of the dot-com bubble, he added that “the scale of AI’s impact” is far greater.
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“People say, ‘This smells like a bubble,’ but they’re not asking, ‘What happens to traditional businesses that could be deeply disrupted?’ Think of rule-based industries — law, accounting, transaction processing — the impact will be profound,” Gray noted.
Balancing AI risks with transformative opportunities
Gray compared the coming disruption to the collapse in New York taxi medallion values after Uber and Lyft entered the market. Blackstone has been assessing AI’s risks for years, avoiding vulnerable software and call-center acquisitions while repositioning industrial firms like Copeland and Legence to supply AI data center infrastructure.
Despite these precautions, Gray believes AI could unlock massive productivity gains: “We’re forcing the conversation. We don’t pretend to know exactly how it will unfold. But if every deal team has to analyze AI’s impact, then it’s the number one topic in the room. Acting as if it’s business as usual would be a mistake.”
Photo: The Daily Courier
