Emerging AI Investment Opportunities Beyond Big Tech
The ongoing artificial intelligence (AI) revolution, described as the “biggest platform shift since electricity,” is predicted to create lucrative opportunities for smaller tech firms, according to Clare Pleydell-Bouverie, co-lead fund manager at Liontrust Asset Management.
In an interview with CNBC, Pleydell-Bouverie emphasized that the dominant players of the last tech cycle—referred to as the “Magnificent Seven,” which includes Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla—may not necessarily lead in this new phase of technological transformation. Instead, emerging firms focused on AI applications and infrastructure are poised to become significant players.
“This year, we’ve concentrated on the AI infrastructure layer, which is essential for scaling this technology,” Pleydell-Bouverie stated. She highlighted sectors like silicon chip production, semiconductor equipment manufacturing, and network infrastructure as critical to enabling AI growth. Companies like Broadcom, Amphenol, and Arista Networks are vital in building the foundational layers of AI’s technological stack.
The “stack,” as described by Pleydell-Bouverie, includes several layers:
- AI Infrastructure: Firms providing hardware and connectivity, such as chips, cables, and networks.
- Foundation Model Providers: Companies creating large-scale machine-learning models, which she characterized as highly competitive and commoditized.
- AI Engineering Firms: Those enabling businesses to integrate AI into their operations and services.
While the infrastructure layer currently holds the most value, Pleydell-Bouverie foresees this shifting toward application and integration in the near future.
Nvidia’s Strategic Position in AI
Nvidia remains a standout in the AI space, which Pleydell-Bouverie compares to Apple’s dominance during the smartphone revolution. However, she argues that Nvidia is often misunderstood as merely a chip provider.
“Nvidia is positioning itself as the operating system for the next generation of AI-infused software,” she noted, pointing to the company’s strategic shift toward integrating software and hardware to power AI applications. Nvidia’s shares have surged by over 180% in 2024, fueled by demand for its advanced AI chips like Blackwell.
Pleydell-Bouverie sees Nvidia as the primary beneficiary of the AI boom in 2025, likening its current trajectory to Apple’s rise under Steve Jobs, who combined hardware innovation with software integration to dominate the tech landscape.
As AI continues to redefine industries, investors are encouraged to look beyond traditional Big Tech giants and explore opportunities in emerging firms that are reshaping the AI ecosystem.
