Technology investor and Trump adviser Peter Thiel warns that Silicon Valley investors tend to depict start-ups into "deeply misleading" categories and trends.

Silicon Valley is now focused on self-driving cars and artificial intelligence, while a few years ago the buzz was around big data and cloud computing, CNBC.com reported Thiel as saying.

Once something is a "trend," it means others have already identified it, so it's unclear what is innovative about it, said Thiel, co-founder of PayPal and author of the start-up book "Zero to One."

When an investor gets a pitch with a lot of buzzwords, it's like a "tell" in poker that the company is not unique, Thiel said.

"If you hear these things, you should think fraud, and you should run away as fast as you can," Thiel said at the CERAWeek by IHS Markit conference in Houston.

• Peter Thiel: I Won't Take a Job With Trump's Administration
• Peter Thiel: Apple's Time as Innovator Has Come and Gone