What happened
BIS Bulletin No. 137 (published 1 October 2026) provides novel quantitative evidence that the AI sector is heavily self-investing: 'Between 2021 and 2025, 28.7% of artificial intelligence (AI) firms' investment deals (by deal value) involved a target company that was also an AI firm, while 55.2% of incoming investments in AI firms came from other AI firms.' Of all AI-to-AI deals in that period, '16.1% (by deal count) and 46.4% (by deal value) also involved commercial supply chain relationships between the investor and target firms.' The bulletin argues these circular relationships reflect legitimate economic drivers (securing critical inputs, information asymmetries) but 'entail macroeconomic risks and increase opacity' for the financial system.
Why it matters
Executives and financial-risk leads assessing AI-sector exposure get a hard quantification of how intertwined AI capital and supply chains are — a concentration and opacity signal relevant to lending, investment, and counterparty risk thinking.
Action needed
Ask your risk and credit teams to weigh AI-to-AI circular investment and supply-chain concentration when modelling AI-sector counterparty exposure.