Tech guru Igor Pejic says an AI bust wouldn't rival the dot-com crash — but there'd be almost 'no place to hide'

Igor Pejic is the author of "Tech Money." Igor Pejic 2026-03-22T10:40:01.240Z Share Copy link Email Facebook WhatsApp X LinkedIn Bluesky Threads lighning bolt icon An icon in the shape of a lightning bolt.

Impact Link Save Saved Read in app This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in. If the AI boom ends up a bust, it won't be nearly as brutal as the dot-com crash, Igor Pejic says. The "Tech Money" author said Big Tech's self-reliance, varied businesses, and deep pockets help. However, he said the rise of index funds means a market slump would have widespread impacts. AI-generated summary Summaries are generated by an AI model trained on Business Insider's articles. AI may make mistakes or provide inaccurate/incomplete information. We're unable to load that answer right now. Please try again. What factors limit AI market collapse impact? Why are index funds key in market slumps? How has Big Tech adapted to tech shifts? How does Big Tech's dominance affect markets? What are the risks of AI giants going public? If the AI boom collapses, it won't be as catastrophic as the dot-com crash — but the shockwave will be felt far and wide, Igor Pejic says. Loading audio narration... The banker and author of a new guide for tech investors titled "Tech Money" told Business Insider this week that Big Tech's unprecedented dominance will limit the magnitude of any market decline.Pejic underscored the greater "stickiness" of companies like Alphabet and Microsoft compared to the leading companies of the past, such as Exxon Mobil, General Motors, and IBM. Big Tech companies have remained dominant for decades partly because of their platform models, which give them "almost limitless pricing power" and make them "almost impossible to dislodge," he said.In other words, they've become powerfully entrenched by attracting so many users, app developers, hardware suppliers, advertisers, and other parties to their ecosystems over time. Now they can easily hike their fees, and new market entrants struggle to capture any market share from them. Every time Theron publishes a story, you'll get an alert straight to your inbox! Stay connected to Theron and get more of their work as it publishes. Sign up By clicking "Sign up", you agree to receive emails from Business Insider. In addition, you accept Insider's Terms of Service and Privacy Policy. Pejic also pointed out that Apple, Meta, and their peers have successfully navigated multiple technological shifts, such as moving from desktop computers to mobile devices and from on-premises IT equipment to cloud hosting.Big Tech companies also throw off gobs of cash, enabling them to place several big bets at once, and fund their investments instead of relying on costly external financing. Pejic described that as a "moat" against rivals, especially in an AI race characterized by "tremendous infrastructure costs." Shades of the pastPejic drew several parallels between the AI boom and the dot-com bubble. The similarities include a game-changing technology, partnerships and financing deals between key players, the buildout of network infrastructure, and "extreme" valuations, he said.Yet Pejic said an AI crash would "not be as devastating as the dot-com bubble when it burst." Any market sell-off will be briefer and less severe because today's tech giants have highly profitable core businesses, he said, meaning their stock prices won't collapse completely if their AI bets flop.They're also less likely to suffer a cash crunch or trigger a financial crisis given their limited reliance on bank funding, and investors have been more discerning about which AI stocks they buy versus rushing to own any business with ".com" in its name, he said. Pejic did raise some concerns, including the fact that so many companies are spending huge amounts to build the best AI model possible, but the market can probably only support a few of them in the end.He also flagged the immense amount of investor cash riding on a handful of tech stocks, given the rise of index funds that own indexes such as the S&P 500, which is weighted by market capitalization and thus intensely concentrated in the Magnificent Seven. "It's very difficult to find a place to hide if this really goes down," Pejic said. "If you're keeping your money in the stock market and AI goes down, it will affect everything."He noted that risk will only become greater as AI giants such as OpenAI, xAI, and Anthropic go public and join the index, increasing everyday investors' exposure to AI. Pejic said owning Big Tech stocks was "perhaps the safest way" to profit from AI, given their self-reliance, vast resources, and diversified businesses, which should limit their downside and insulate them from industry shocks such as the emergence of DeepSeek.For example, he praised Apple's approach of refraining from spending hundreds of billions on microchips and data centers, in favor of seeing how the AI race plays out, and partnering with peers or buying in capabilities to harness the tech. Apple might not be the "most exciting company," but for investors, owning it is a "clever and quite safe strategy without burning too much cash," he said.