Artificial intelligence will no doubt change much about our world in the long run. But for now, we may be living through an AI bubble.

Those seeking evidence of this might cite news of Cognition Labs seeking a $2 billion valuation, as reported by the Wall Street Journal on Saturday.

Founded in November, Cognition Labs makes Devin, which it describes as the “first fully autonomous AI software engineer.” It’s generated no real revenue. It launched Devin this month.

Earlier this year, the startup raised $21 million in a deal valuing it at $350 million. It then turned down offers valuing it at $1 billion. Now, according to the Journal, it’s in talks with investors for a deal that would value it at up to $2 billion.

That’s a staggering figure for a new venture. But it’s not all that shocking in today’s AI space. Perplexity, an AI search startup challenging Google, secured funding a few weeks ago valuing it at $1 billion, up from $520 million a few months prior, with Amazon founder Jeff Bezos among the backers. Mistral, a French AI startup founded just over a year ago, hit a $2 billion valuation in December.

‘Every bubble has a compelling narrative’

Each of these startups might well justify their lofty valuations. But as more and more AI ventures snag improbably large sums from investors spreading their bets, the sense of a bubble increases among some observers.

Albert Edwards, chief global strategist at Société Générale, is among the skeptics.

“Every bubble has a compelling narrative,” he wrote in a note this week. “The current narrative centers on the anticipation of an AI-driven surge in corporate profits to fully justify the current stratospheric valuations. Those of us who lived through the late 1990s [tech] bubble have heard it all before and roll our eyes skyward.”

As for Devin, “a lot of companies are working on some variation of this idea,” venture capitalist David Sacks noted on a recent episode of the All-In Podcast. While he likes the venture’s “agent-first approach” for generating new software projects, “where I think this gets much trickier and is much more difficult is when you’re working in existing code bases,” a challenge other AI startups are addressing.

One advantage with Devin, he added, is that it’s “gonna demo really well.”

Whether cool demos that wow investors today translate into thriving companies years down the road, of course, remains to be seen. Either way, today’s eye-popping valuations for unproven startups will likely be remembered.