Is your company AI-washing? Rippling founder Parker Conrad thinks it might.

Parker Conrad, founder of Rippling, a $13.5 billion HR startup, shared some interesting thoughts on AI during a recent appearance on our Found podcast.

“Nobody really wants to talk to their HR software other than something new, like, oh my god, this is working for me,” he said.

He also believes that too many software companies are adding unhelpful and uninventive AI features to their products.

“There’s just a lot of really irrelevant stuff in the AI ​​world,” Conrad said, adding that “that’s not to say AI won’t be transformative. There are a lot of opportunities that are really important. I’m just not impressed by a lot of the ones I’ve seen.”

He still understands why companies do AI wash—claiming their products are AI or use AI in significant ways when they aren’t. There’s such a crazy scramble to use AI right now that the entire tech industry wants to “sprinkle AI pixie dust” on all of its products, he said.

“They’ll say, ‘Heck, if I’m a SAAS company, my multiple is 7x, but if I change my name to whatever I had before (with) .ai, my multiple is 50x,’” he said, referring to how investors value startups as a multiple of their revenue.

His perception isn’t necessarily wrong. In the first half of this year alone, AI companies accounted for 41% of all deals in the U.S., according to Pitchbook. AI and machine learning companies specifically raised $38.6 billion of the $93.4 billion invested in U.S. startups in the half. What’s more, more than 40% of all new unicorns were AI startups. Last year, AI companies raised $27 billion, most of which came from big tech companies that spent big on Gen AI startups, the Financial Times reported.

“AI is touching almost every aspect of our lives,” says Nekeshia Woods, managing partner at Parkway Venture Capital, a firm that focuses on AI. Her approach is typical of Silicon Valley. She sees AI quickly becoming the way companies automate routine tasks; the near future will be AI assistants and general-purpose robots. “From a consumer perspective, engagement and demand will be focused on higher-quality products and services that can be hyper-personalized to make better use of their time, like with self-driving cars,” she continued.

All of this underscores how unusual it is that Conrad is a public skeptic. As Conrad has said before, while he’s still not convinced about the value of AI agents, he believes AI will be powerful not because it can write, but because it can read. That means it can absorb vast amounts of unstructured information that could help a company better understand its business, he said.

“This sort of solves the problem that these things are only probabilistically correct, not deterministically correct,” he said of current AI models. “And that’s fine in a world where systems flag anomalies for management to say, ‘Look, you don’t have time to look exhaustively at everything in your business this month. But if you’re only going to look at five things, these are the ones you should look at.’”

There’s no doubt that all the hype about AI — or, for some people, the doomsday talk — is getting tiresome, and a consequence of that is so-called AI fatigue, although Woods disputes that description.

“I see it as less fatigue and more of a question that’s starting to be asked about AI,” Woods said. She, like Conrad and others, wants to know: When will a large AI investment pay off?

“It’s hard to see anything from here,” Conrad said.