The Exchanges

Q Given those categories across energy, ships, and manufacturing, what are some of the portfolio companies that American Dynamism has?

A Yeah, so I mean, look, we, we today are investing very actively, obviously defense, space, public safety, energy, and now we're increasingly looking at mining, manufacturing, um, and of course we make like the one-off investments in other areas too when we find an iconic great founder. Some of those companies in energy, um, I think of energy as like generation, transmission, and storage as like the three big buckets of energy. And so for energy generation, we have an investment in Radiant Nuclear. Um, I'm very excited about that company. Uh, it's been a long time since this country's had a new nuclear power company. I think Radiant is going to turn on the first fueled nuclear reactor of a new design in like 50 plus years. I think they're going to do it next year. I'm very excited about them. Um, amazing team. Amazing pace of execution. Their productivity is out, is just extraordinary. And they're building a reactor that fits in a shipping container and can be transportable. Um, so that's awesome for natural disasters. It's awesome for remote locations. Um, it's basically a diesel generator anywhere that gives you five years of clean energy when you flip it on. Um, in terms of resiliency and storage, we have an investment in base energy. So base energy is, they're starting in Texas, but they'll expand from there. This was started by Zach Dell and Justin Lopez. Zach Dell worked a…

AI assessment note: “we have an investment in Radiant Nuclear... we have an investment in base energy”

Q of these marketing campaigns? This is something I talked to Eric Christman from Altimeter about, because they're also investors in Anderle, but it's like, you have a defense company primarily selling to the government. It's enterprise. Why are you creating like this brand halo around it? And it's almost become like a consumer brand, which is, it, by the way, it's like entirely effective and very, very good. Like why?

A Yeah, I think it's important. Like, look, Andrel never loses sight of who their customer is, and they have a ton, like, you know, there's tons of, like, collateral and white papers and documentation for their customers, but at the same time, they're hugely dependent on support from Washington for the work they're doing, and if you want people to believe in transforming the way defense production works in this country, you need the public to come along with you. You need the policy makers to come along with you, and that requires basically a full-fledged, um, you know, marketing effort. And people, also it gets people fired up. It like makes people feel patriotic. And so I think what they do it for a bunch of reasons. One is they're unashamed of who they are. They want to make it very clear to their own employees and the public who they are. They are a defense company that includes making weapons and making systems, um, like that. They want to make sure that policymakers know who they are. They want to attract the best talent. So they create a magnet for talent. And so I think for all of those reasons, it's important that they have this public face. And not just be, like, a shadowy defense company. Um, and I think one of the things that they get away with is, like, you know, people might say, like, I don't want to work at a defense company. That's fine. They can opt out. But, li…

AI assessment note: “if you want people to believe in transforming the way defense production works in this country”

Q How did the capital commitments from the government then bleed into this or like collaborate with these kinds of investments? Because there have been really big Commitments

A Yeah, so I think, you know, people, so the government wants to create a set, like a, uh, a culture of accountability, and that comes with a lot of challenges, actually, and those challenges are better solved with private capital. So an example is, if the government gives you fifty million dollars for an R&D project to go try to create a prototype of something, they want to make sure you're spending the money wisely. So that fifty million dollars comes with a ton of overhead of auditing, accounting, tons of oversight, and as a taxpayer, that Feels totally appropriate, but it's so burdensome for a small company. It's almost impossible for these small companies to cope with that level of oversight. And so that's why most of the time these big contracts just go to the primes and the primes have all this structural, um, kind of systems built up to deal with that. So they love the system. They love the oversight. They love, and by the way, they just charge more for the contracts because they have all this overhead and over in accounting and auditing that happens. And then ultimately results in a poor experience for the taxpayer because We don't get the best products. We don't get them quickly, and we don't get them on budget. Where private capital instead is, I think, a much better alternative is we say, look, if you don't pay for the R&D, you just buy the finished product. All you h…

AI assessment note: “All you have to do is commit to buying the finished product. We'll fund the R&D”

Q What's the most investable wedge for US founders against this China situation?

A I think we're seeing now that there's a huge opportunity to drive manufacturing transformation in this country. I think we're on the precipice of a robotics revolution. Um, and robotics doesn't have to be like the humanoid robots we see in like videos on X. Um, although I think those are coming, that would be cool. But even just like, um, automation and robotics that are general purpose robotics that can do assembling. Um, I think we're gonna have lights out factories the way they do in China. Um, So I think manufacturing is one, and that's everything from like motors, um, to metal work, um, to all kinds of production capabilities. Uh, and then I think if you look even left of that, you're gonna see minerals and mining, whether it's lithium, whether it's copper, whether it's steel, like we don't have very many steel smelters in this country anymore. We used to have a lot. We have almost none now. That's a huge opportunity. Lumber and wood is another one. There's a company called I'm gonna mess it up, the lumber manufacturing. Um, it's transforming the way we produce wood in this country, and the way we produce lumber in this country is really important. We can't just have it all come from Canada, we can't have it come from other places, and we need to have much more lumber in this country than we currently have, because we want to build much more, we want to build much more hou…

AI assessment note: “huge opportunity to drive manufacturing transformation in this country. I think we're on the precipice”

Q But how does this impact this category since that's, like, such a large driver of, let's say, investments and then also, like, new teams?

A So I think you can look from any dimension and recognize that AI is transforming all of these categories as it should. So if you start at the most fundamental level, like energy, we just have an insatiable thirst for energy in this country, and AI compute is driving a huge amount of it. Part of the shift to electric vehicles, obviously we have EVs today, but as we shift to more autonomous vehicles, all those vehicles are going to be electric as well. Um, and so that drives it as well. People now recognize, you see that natural disasters are getting worse and people want more resilience in the grid. So they want to have home battery systems so that when the grid is either too expensive or offline, their home can stay online. And so you see more and more people deploying batteries. So like energy need, like, like AI is driving this massive energy boom in this country. And I think I've seen a chart where commercial real estate, um, construction is like petered off and dropping, but like data center construction, It's like just asymptoting, you know, and going through the roof, um, and that's all being driven by AI compute, and that AI compute will then power lots of, lots of things. It's not just going to power chat GPT, but it's going to power autonomy systems, all kinds of other language models, and all other kinds of use cases. Then if you look at defense, computer vision, tran…

AI assessment note: “AI is transforming all of these categories as it should. So if you start at”

Q close it is to regulatory environment and all the different kinds of policies and going closer to DC. We've seen in the last years, uh, last couple of years, especially with the new administration, this like really great connectivity between Silicon Valley and DC. But I'm curious from more of a structural standpoint, like how did you set up the fund and how do you help these companies with policy?

A Yeah. I mean, look, we, I love working with entrepreneurs. Catherine loves working with entrepreneurs. Having a fund that is sized appropriately for the size of the opportunity has always been important to us. We think our opportunity set is actually just getting better, bigger, um, and there's more categories that we want to make sure we can make investments in, but a part of that is also making sure that we have the resources to support our companies, and Washington is a really important place to do that. The firm has always been founded on this practice of how do we build the firm that we wish we had when we were entrepreneurs, and most of the leadership at Andreessen Horowitz were either founders of companies, ran companies, have technical backgrounds, um, from Ben and Mark all the, all the way across the board, uh, and so we know, and like, I raised money for my own company, Ben and Mark raised money a couple different times, uh, Martin Cassata raised money, Alex, you know, et cetera, and so we know what it's like to have a venture firm That's just treated, like, treats you like a financier. Like, they just give you the money, and then you're off on your own. We think there's a better way, and so one of the things we've done in the American Dynamism Fund, without, you know, being too much of a shill, but obviously I want to sell my own book, because it's, I think it's a ve…

AI assessment note: “we've built out a policy team in DC, and there's work that we're”