Insurance capital could help finance AI infrastructure

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 24:47

   And you have to, I think maybe the motto of this episode should be follow the money. If you follow the money to your earlier question, Peter, where is the capital going to come from? Many of the obvious capital pools are being. exhausted in the process of financing this build out. I think insurance is probably next. And you have to ask, how is the money going to be routed? There are trillions. The number that I've seen is in the U.S. approximately $6 trillion of life insurance capital and about $3 trillion of property casualty insurance. And so I suspect this is not investment advice, but someone out there is going to make quite a bit of money finding a clever way to financially engineer capital flows from these huge pools of premia and insurance cash and investable assets from insurance to the AI or SI infra build out, because there are just so many trillions of dollars that

2. 25:44

   are sitting on the sidelines. Very timely, actually, Alex, because we had our quarterly earnings call at EverQuote yesterday. And that's basically all we talk about now is how is AI going to tap into that massive insurance? It's completely untapped capital. They've been very slow to act. And they also haven't reserved a lot of compute. And so even for their own internal uses. So the ultimate business case is, hey, uncork all your money, use it to invest in this category, but then in return for the investment, ask for capacity of compute back because you know you're going to need it. And that's the win-win. And someone's got to unlock that. I think Kush has already been talking to the teams about that. There's a big elephant in the room, though. We're building the planetary level nervous system with all this build-out before we've got global

3. 26:35

   institutions that can navigate this in any way, shape, or form. This is going to cause huge structural imbalances. AI will be that navigating system. I mean, ultimately, I don't see any future You know, talking about this on Election Day, I don't see any future in which governments are not being run by sovereign AI systems. Period. It'll have to be, but you'll take a while. The singularity probably does want to regulate itself, but I also think that there may be a historic irony here.

4. 27:05

   Do you guys remember when Elon and Warren Buffett were trading jabs about who was running a better business? And at one point, Warren said to Elon something on the order of, well, I bet you wouldn't want to or wouldn't be able to run a chocolate business as well as Berkshire Hathaway is operating See's Candies. And Elon, I think at the time, fired back, well, sure, like I'll just launch a chocolate business.

5. 27:30

   candy business, far easier than everything else I'm doing. But ultimately, Elon and his ecosystem of companies never launched a Seize Candy's competitor. I do think it would be ironic if ultimately Elon, as one of the avatars of the AI infra build-out, ultimately got into the, indirectly at least, the insurance business that via its float is powering Berkshire Hathaway and basically siphoned a lot of the insurance float away from whatever Berkshire is funneling toward apparently seized candy type ventures and instead toward the singularity in for a build out.

6. 28:07

   I think that would be a hilarious plot twist to that Elon Warren seized candies chocolate saga. Only you, Alex. Only you. I love it.