The past couple of years have really driven home the fact that a company is worth what someone will pay for it

Could be if they are pre-revenue.

AMD grew their revenue 50% last quarter from the year prior, for 11.5B in revenue. If this team can help continue that or grow that then yes - the amount of money involved here is insane.

Honestly, I think this 'billion' number is also just the ball park for companies you need to pay if you want to buy them.

OpenRouter was sold for 7.5 Billion.

Lets just accept, that these people don't evaluate a company by value but by magic market "what is a sum someone needs to pay for buying a company and what company is somehow worth it to actually buy for this type of money but more in a sense of adding this to your portfolio"

A name like Fei-Fei Li is probably worth a chunk of that (I'm not saying I agree, but that's probably the thinking).

It's a public bet, not a valuation based on product economics. Billion dollar bets follow different rules (and I'm not saying it's sane).