AI industry leaders are increasingly vocal about their disdain for short sellers, with Palantir CEO Alex Karp and OpenAI founder Sam Altman leading the charge against investors betting against their companies. In a heated CNBC interview last month, Karp unleashed a passionate defense of Palantir, questioning why short sellers would target “one of the great businesses of the world” that supports warfighters and helps average investors make money. His comments reflect growing tension as AI companies face market skepticism despite their meteoric valuations.
Sam Altman expressed similar frustrations during an October appearance on the Bg2 Pod, stating he sometimes wishes OpenAI were public specifically so short sellers could bet against it. “I would love to tell them they could just short the stock, and I would love to see them get burned on that,” Altman said, responding to critics claiming OpenAI is “about to go out of business.” Meanwhile, Nvidia CEO Jensen Huang addressed AI bubble concerns during the company’s November earnings call, pushing back against skeptics by noting that from Nvidia’s perspective, the AI landscape looks very different from the bubble narrative.
These AI titans join a long tradition of executives battling short sellers, including Tesla’s Elon Musk and GameStop’s Ryan Cohen, who called the practice “un-American.” However, financial experts argue that short selling serves crucial market functions. Ryan Kelley, chief investment officer at Hennessy Funds managing $4 billion, explains that short interest naturally increases as companies grow larger and derivatives markets expand around their stocks.
Short sellers have historically exposed corporate fraud and malfeasance, including the 2015 Valeant pharmaceutical scandal. They also provide market liquidity and act as a counterbalance during periods of excessive euphoria. Maurits Pot, founder of Tema ETFs, emphasizes that “short selling is core to the market” and represents the natural functioning of capital markets, as long as it doesn’t become coordinated manipulation.
The article argues that attracting short interest is actually a badge of honor for companies like Palantir, which has surged 1,720% since its October 2020 IPO. As companies reach significant scale, diverse opinions about their valuation are inevitable and healthy. While executives understandably take short bets personally given their investment in building their companies, market experts suggest CEOs should recognize short selling as a sign their company has reached the big leagues rather than viewing it as a personal attack.
Key Quotes
They could pick on any company in the world. They have to pick on the one that actually helps people, that’s actually made money for the average person, that is actually supporting our war fighters. These people, they claim to be ethical, they’re actually shorting one of the great businesses of the world.
Palantir CEO Alex Karp said this during a CNBC interview when asked about short sellers betting against his AI data analytics company. His emotional response reflects the personal nature executives take when investors bet against their firms, despite Palantir’s controversial work in government surveillance.
There are not many times I want to be a public company, but one of the rare times that it’s appealing is when those people are writing these ridiculous, ‘OpenAI is about to go out of business.’ I would love to tell them they could just short the stock, and I would love to see them get burned on that.
OpenAI founder Sam Altman told the Bg2 Pod in October, expressing frustration with critics questioning his company’s valuation. This reveals Altman’s confidence in OpenAI’s business model despite ongoing questions about profitability and sustainability.
Short selling is core to the market, and I think as long as short selling doesn’t become a coordinated, speculative attack, I think it’s part of the regular functioning of capital markets.
Maurits Pot, founder of Tema ETFs managing $1 billion, provided this defense of short selling’s role in healthy markets. His perspective counters the narrative from AI CEOs by emphasizing that betting against companies serves important market functions.
It’s a possibility that people can be adamantly against the way you’re running a business, and it should be that they’re able to actually put their money where their mouth is — in other words, short the stock and be vocal about it.
Ryan Kelley, chief investment officer at Hennessy Funds managing $4 billion, explained why short selling represents legitimate market expression. This highlights how financial professionals view short interest as a necessary check on corporate behavior and valuation excesses.
Our Take
The defensive posture from AI industry leaders reveals an uncomfortable truth: these companies are now facing the same scrutiny that all high-flying stocks eventually encounter. Karp and Altman’s reactions suggest they may be unprepared for the natural skepticism that accompanies trillion-dollar valuations and transformative technology claims. What’s particularly interesting is the timing—these comments come as AI stocks trade at historically high multiples while questions about profitability and practical applications intensify.
The irony is that short interest in AI stocks could actually validate their importance rather than undermine it. When Michael Burry questioned GPU depreciation rates, he performed a valuable service by forcing investors to think critically about assumptions. As AI moves from hype cycle to business reality, having vocal skeptics with financial skin in the game will help separate genuinely transformative companies from those riding the wave. The CEOs protesting loudest may ultimately benefit from this market mechanism.
Why This Matters
This story highlights growing tensions as AI valuations reach unprecedented levels, with industry leaders becoming increasingly defensive about market skepticism. The pushback from executives like Altman and Karp signals that AI companies are entering a mature phase where they face the same scrutiny as established tech giants. This matters because it reflects broader questions about whether AI stocks are overvalued and whether we’re experiencing an AI bubble similar to previous tech manias.
The debate over short selling in AI stocks has significant implications for market efficiency and price discovery. As billions of dollars flow into AI investments, having mechanisms that allow skeptical voices to express their views through short positions helps ensure more accurate valuations. For businesses and investors, this story underscores the importance of understanding both the bullish and bearish cases for AI companies, rather than accepting hype uncritically. The fact that prominent AI CEOs feel compelled to publicly defend their valuations suggests the sector may be approaching an inflection point where fundamentals will matter more than growth narratives.
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Source: https://www.businessinsider.com/sam-altman-alex-karp-short-sellers-openai-palantir-elon-musk-2025-12