Joe Lonsdale, the founder of venture firm 8VC, says that top executives in artificial intelligence are underselling the resources they need to meet their ambitious goals.

These companies are ” afraid to scare their investors, and so they are telling them they need a lot less capital, a lot less energy than they know they actually do,” Lonsdale, who previously co-founded Palantir, told CNBC’s “Squawk Box” on Thursday.

This dynamic will create a continuous cycle where executives look for more capital and energy every three to six months to power their initiatives, Lonsdale said.

Tech giants have ramped up spending on AI in recent months to build out infrastructure and lure top talent. Some skeptics worry that a bubble is forming and that companies are overspending with no clear path to a return on investment.

“If anything I think we’re underestimating how much investment is going to go into this space and how much we’re going to need,” Lonsdale said.

Meta, Alphabet and Microsoft all bumped up their capital expenditures guidance on Wednesday in their quarterly earnings reports. OpenAI, which is valued at $500 billion on the private market, has been on a historic spending spree of late.

Executives have said they’re responding to soaring demand for AI tools and services. Alphabet CEO Sundar Pichai chalked up the boost in spending to elevated cloud demand, while Meta CEO Mark Zuckerberg said his company is “aggressively” ramping up in the race to superintelligence.

Lonsdale said he is focusing on companies creating apps and services that are “very economic” and “profitable.”

“I’m building a lot of companies in the real economy that are increasing productivity,” he said.

WATCH: Meta’s capex may not be producing returns