Physical AI

“In, in hardware now, for instance, which is like the new thing, right, that's consensus physical AI the time to get validation is just a lot longer, and so you have to invest early, hoping that those companies can get through those phases of experimentation an…”

“We've been doing this for a long time, ok? This is a continuation of a lot of the awesome things we did back in the Uber day.”

“These are not the tokens you're going to find online. Like you can't crawl Reddit and find out about what happened on a construction site, right? Nor can you do you know, test time reasoning about it. You can't just, you can simulate all kinds of environments,…”

“Our robotics business, autonomous vehicle business, basically physical AI business is probably almost, it's like ten billion dollars, so it's really, really big already.”

“Likely this will be one of the largest industries in the world, and it'll take longer than a couple, two, three years. It'll take less than 10, and so this will be our next hundred billion dollar business.”

“I like to say that the labs, they have it easy because they can make models that are trillions of parameters, and those models can be super slow, and that's fine, but we don't have that luxury in physical AI, right? We deal in real time, like the actual, actua…”

“So I think there'll be a whole industry that's built out where given the data sets that are available, a lot of it is visual data and the right world models that are built around it. You can train these machines and I'm using machine very broadly or robots muc…”

“Physical AI is our ability to take every physical asset in the world and give it a digital identity. And you go beyond just having recognition of what information from that asset is associated to a tag around it, but the condition that that asset is sitting in…”

“And it's beyond just knowing the location and the traceability of that item, but the condition that it's in. And that's where physical AI starts to pick up value beyond what historically was in place. So with condition, you know the temperature of that item. Y…”

“It creates a frictionless handshake between food processors and the folks that are receiving the items. So there's no finger pointing. You can actually go to the source of the truth where something went wrong and then fix the compliance between those two parti…”

“I think the physical world and AI going into that is, I think when we look back, I think that's going to be the bigger story. And then look back 25 years from now.”

“We are building multimodal visual models for content creation and for now physical AI.”

“I don't think physical AI will be as easy as having a generic frontier model because there's no consumer use case for physical AI, right? It's a depth use case only.”

“And right now, beside the agentic AI, now you're looking at physical AI, it's a mixed big frontier, and then you have to really look at a full stack. That's why I'm still involved with a lot of this frontier model that we very familiar, and some of the investm…”

“And the, and I think if you get an equivalence, I think physically AI is at the same point where Chad GBT was in around 2015, where it's just finding its roots.”

“We can have really good foundational models, but the customer could not care less. They really care about how does it hit their top line and bottom line performance, which is either how does it impact their labor or how does it impact their shipping rates? Or …”

“Once these models can use computers and understand the future state of computer extremely well, the robots might be Might be one of the tools a very powerful AI can use. So the powerful AI might just be able to control the physical embodiment naturally.”

“The other part is there's this lineage of technology going through VR and then AR and now in, I'm using the term robotics, physical AI, but you really have to step back and look at autonomous vehicles, drones, obviously robots autonomy period, manufacturing, l…”

“The big unlock honestly for physical AI as an industry is that these models are just Becoming much more reliable, right? Things like things actually work a lot better. It's like the number of nines you can get out of these systems are now good enough that it a…”

“In the physical AI world, we're not really constrained right now by like the intelligence of the models. It's actually what Peter's talking about is actually deploying them. ... On the hardware you give you. And so, and there's just a reality is of safety crit…”

“So the interesting thing is, I think probably everything in the world can actually be boiled down to like a next token prediction problem. And In any workflow, anything can be thought of almost as like there's this, the sequence of steps or the sequence of tra…”

“Without talking about any specific use case, I believe that a lot of it's going to have to be on device and dedicated to that use case.”

“One was transformers. That were originally successful for large language models, like you heard about Anthropic and OpenAI those started to have an impact on self-driving technology and robotics, and we thought that was really interesting, and then on top of t…”

“Physical AI is very different. The companies are different, the geographies and regulatory environments are different, the machines are different, the cultures are different, and so the diffusion is actually way, way slower, so time becomes a much more importa…”

“Physical AI as a large category. It's technology industry's first opportunity to address a 50 trillion dollar industry that has largely been, you know, void of technology until now.”

“It is a multi-billion dollar business for us. It's close to ten billion dollars a year now.”

“The, that is where I think this, you know, this kind of intelligence kind of revolution in the real world is really, I think is going to fill those gaps in rather than like an entire industry suddenly gone and it's just automated.”

“And so I think the natural kind of extension of what we see is kind of what happened in the compute markets where you really needed flexible capital, where it wasn't just equity, it was debt and, you know, a variety of project finance to really scale capex. Yo…”

“I think the products will support investment grade buyers who are going to have contracts that say, like, we want it, and you can raise debt against it.”

“I think simulation will actually be the larger market initially. So I think in simulation because you have very little constraints also from a safety perspective, simulation is much easier. So I think a lot of the takeoff initially sits in simulation.”

“Yeah, I think so because I think they're gonna, today, they largely use repurposed automotive chips, right? Things that have functional safety compliance around ADAS, but they're not specific for actuators or specific for smaller parts of the joint. So, physic…”

“So we, you know, we certainly see this broader category of moving AI from the laptop To the manufacturing floor, to the store as being one of the core themes for the next 12 to 24 to 36 months.”

“So rare earth magnets are really the feedstock to physical AI.”

“The future of warfare, Is physical AI, right? Robots and drones.”

“For physical AI, they're a kingmaker in parts because they're a sink for demand. So they'll just generate so much demand for robots.”

“To the extent that there's going to be a big impact of AI on the energy sector, on climate tech, apart from its obvious impact on energy consumption, which we've already talked about ad nauseum here This area, physical AI, is where I think the impact is going …”

“That level of simulation is, is not sufficient. For building physical AI that are gonna be the underpinnings or the fundamental components of a robot brain.”