00:00When you think about AI, you think about the AI models, but it's really important to understand industrially, AI is actually essentially a five-layer cake.
00:10At the bottom is energy. AI, because it's processed in real time and it generates intelligence in real time, it needs energy to do so.
00:20Energy is the first layer. The second layer is the layer that I live in. It's chips. Chips and computing infrastructure.
00:27The next layer above it is the cloud infrastructure, the cloud services. The layer above that is the AI models.
00:35This is where most people think AI is. But don't forget that in order for those models to happen, you have to have all of the layers underneath it.
00:45But the most important layer, and this is the layer that's happening right now, the reason why last year was an incredible year, frankly, for AI,
00:52is that the AI models made so much progress that the layer above it, which is ultimately the layer that we all need to succeed, the application layer above that.
01:04And so this application layer could be in financial services, it could be in health care, it could be in manufacturing.
01:09This layer on top, ultimately, is where economic benefit will happen.
01:15But the important thing, though, because this computing platform requires all of the layers underneath it, it has started, and you guys are, everybody's seeing it right now,
01:27it has started the largest infrastructure buildout in human history.
01:32We're now a few hundred billion dollars into it. Larry and I, we get the opportunity to work on many projects together.
01:42There are trillions of dollars of infrastructure that needs to be built out, and it's sensible.
01:48It's sensible because all of these contexts have to be processed so that the AI, so that the models can generate the intelligence necessary to power the applications that ultimately sit on top.
02:03And so when you go back and when you reason about it layer by layer by layer, and you realize that the energy sector is now seeing extraordinary growth.
02:13The chip sector, TSMC just announced they're going to build 20 new chip plants, Foxconn working with us, and Wishtron and Quanta building 30 new computer plants, which then go into these AI factories.
02:29So we have chip factories, computer factories, and AI factories all being built around the world.
02:36And memory.
02:37And memory, right, exactly. Those chip fabs, Micron has started investing $200 billion in the United States.
02:44SK Hynix is doing incredibly. Samsung is doing incredibly. You could see that entire chip layer growing incredibly today.
02:51And now, of course, we pay a lot of attention to the model layer, but it's really exciting that the layer above them is really doing fantastically.
03:01And now, one indicator is where the VC funding going into. Last year, 2025, was one of the largest years in VC funding ever.
03:12And last year, most of the funding went to what is called AI native companies.
03:18These are companies in healthcare, the company in robotics, the company in manufacturing, financial services, all of the large industries in the world.
03:25You're seeing huge investments going in to those AI natives, because for the first time, the models are good enough to build on top of.
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