Where AI Will Reshape the Physical World Over the Next Decade, According to Shaan Puri and Sam Parr

The conversation opens with Shaan Puri describing how AI often makes people feel obsolete. He says he has two conflicting reactions: one is wondering what he will do if AI can do everything, and the other is a feeling that he should be doing far more while others around him build impressive things.

Puri says it seems like a very competitive game and that he feels late to the race. When asked whether he has many ideas and sits at the computer wondering what to build if he can make anything, he says that is part of it, but the other question is how to use AI to make things.

Sam Parr cites Anthropic as an example of extraordinary business growth, saying it has created about $2 trillion of value in roughly five years and calling it the best business in the history of capitalism so far.

Parr also estimates that, across its seven co-founders, roughly $96 million of net worth has been created every day since founding, adding that each co-founder now owns only about 2 to 2.5% of the company.

The hosts describe the tension this creates: seeing many people profit from AI makes them want to participate, but the competition feels intense, and building something new may become obsolete quickly. Puri says they therefore began asking where they would go if they really wanted to make something happen now.

Puri uses a hockey analogy, 'skate to where the puck is going, not where it has been,' and says the goal is to identify what people will look back on in four or five years as the time they should have acted. He notes that five years ago the place to be was working at one of the model companies such as OpenAI or Anthropic.

Puri says that what people currently hear about AI is its use in coding, personal agents and large language models, but he points to a smaller area he calls 'AI in the world of things' as the more important one.

He argues that using AI in the world of bits, meaning digital work, has very low returns. He says anyone using AI to make content is in a race to the bottom, and that using AI to build software, SaaS products or tools is also largely a race to the bottom. He says those paths are fine if they match someone's interests, but that the opportunity lies elsewhere.

Puri says the first place he would look is drugs and miracles.

Puri describes a social media post listing people who said they were curing their own cancer. He gives the example of a GitLab figure who used AI to sequence his tumor, run possible drugs through analysis, synthesize and compound them, and eventually shrink the tumor. Sam Parr adds that a friend with cancer signed up for a service of this kind and is doing well, and Puri says there are about seven other people doing the same thing.

Puri says the broader idea is that AI will be applied to science, biology and new drug development. He notes that a drug typically took 10 years and $2 billion to develop with an 80 or 90% failure rate, and that because of these numbers only drug companies of a certain size played the game.

He says Eli Lilly is leaning hard into AI, buying compute in the way tech companies do, similar to Citadel and Jane Street building their own data centers for AI in finance. He also says Google has a company called Isomorphic, whose leader, a former DeepMind founder, is now fully focused on it with the goal of curing cancer and solving large health problems. Puri concludes that now is the perfect time to build a new type of drug company or health company.

Parr says he sees this firsthand through a friend named Ben, a former producer who had a very dire outlook and posted an update that he is doing much better after reaching people in the AI community who helped connect him to resources. Puri says he watched the update and was moved by how much better Ben looks and sounds, although Ben still has cancer.

Puri says most people walk past million-dollar ideas without noticing them. He says their friends at Starter Story compiled a list of 90 business ideas, each vetted against real problems and real market gaps after talking to hundreds of entrepreneurs. The list is available free through the QR code or link in the episode description.

Sam Parr says that when he pictures the American military he thinks of tanks, soldiers, boats and perhaps fighter jets, but he suspects that picture is outdated. He compares it to a wife's childhood wedding vision that did not match reality decades later.

Parr says he believes war will probably look like drones fighting drones: unmanned tiny aircraft that are super cheap to build. He points to Ukraine and other places where very expensive equipment can be sent but an inexpensive autonomously flying piece of metal can be made in high volume and still cause significant damage.

Parr says Anduril is obviously doing interesting work in this area and that Joe Lonsdale's company is an underwater version of Anduril, the navy version of that approach.

Parr then asks whether the other person had read about the operation that took the leader of Venezuela, and the discussion moves to descriptions of that incident. Puri recounts a reported weapon that caused security guards to bleed from the nose, vomit and collapse without being killed; he also says a former president called it a 'discombobulator.' Parr then describes meeting a hacker in San Francisco at a hardware co-working space that used to be an auto body shop, where a solo builder told him he was building lasers that can shoot drones from extremely high distances away.

Puri argues that lowering the cost of living would improve people's quality of life, since much of the stress many people feel comes from living costs and feeling constantly underwater. He says a home is the most expensive part of life for most people.

He cites mortgage rates of around 7.25% and says building a nice home in his area costs roughly $600 to $800 per square foot. He says some companies building prefab high-end homes claim costs about 20 times cheaper, and that construction is one of the world's biggest industries, so he expects a night-and-day difference in building costs within about 10 years.

Puri points to a company called Zuru Tech, run by brothers he describes as among the most unusual entrepreneurs, which has a factory in China that prints homes at a rate of about one per day. He says the company bought roughly $60 to $80 million of lots after the fires in Los Angeles, when owners who did not want to rebuild had to sell. He says it raised no external capital and put about a billion dollars of its own money into the project, and that it has spent 20 years building highly automated factories in China, starting in the toy business.

Puri says Elon Musk names Lego as the manufacturing model he most admires, because building blocks at scale with absolute precision requires that every piece fit perfectly with every other piece, with no error even at the smallest scale.

He recounts a meeting at Tesla where Musk, holding a Hot Wheels car while listening to problems on the assembly line, suggested injecting the whole underbody as one mold instead of about 200 pieces. Engineers objected that the car was only a tiny toy, and Musk replied that they could just make it bigger. Tesla built its own custom molding for car undersides, which simplified assembly and put the company ahead of other automakers for about seven years because it owned the machines capable of that size.

Puri concludes that being great at toy manufacturing translates well to manufacturing other things.

Puri says he does not fully understand the new materials work he describes, but that people in San Francisco are trying to literally do alchemy, with claims of making gold from other materials or inventing new materials. He calls it actual material science and says it is above his pay grade.

On self-driving, Puri says he uses his Tesla daily and that it drives about 95% of his miles, with him taking over mainly in parking lots. He says the same self-driving technology is now being applied to forklifts in warehouses and machines that clean windows on skyscrapers, and to machines that could remove barnacles from ships or maintain aging bridges.

Puri says people are building machines that will automatically maintain the living world, such as weather and oceans, which today take a great deal of human effort. He mentions an earlier guest who discussed ocean tech and says that space tech has become very hot with SpaceX and others, while ocean tech is right around the corner for the same kind of growth.

The final example is human body hardware, which Puri says is AI in the world of things where 'the things are us.' He refers to Neuralink and to a friend named Tyler who has worked for years on a project called Adam limbs. Puri says a person who loses a limb in war may be given a stiff, poor prosthetic, while the technology now exists to attach a robotic arm controlled by the mind. He says it is a shame that engineering has not yet brought the cost down enough to make such limbs affordable for people who need them.

Parr says another group feels extremely pessimistic. He says that, boiled down, the most popular parts of America such as New York and California are trending toward socialism, with hostility toward billionaires, companies and AI, and negativity toward the drivers of progress such as capitalism.

He identifies a second source of negativity: America may have hollowed out its ability to build things by outsourcing manufacturing to China. He also notes skepticism about AI from two directions: some people worry about losing jobs, while others believe AI is overhyped and a bubble that will tank the market.

Parr says that if he could change one word, he would switch 'pessimism' for 'uncertainty and fear,' which he calls very understandable. He says what the country lacks are common-sense leaders who can say America is amazing and that it has problems it should fix.

Parr says it is insane to him that capitalism is considered an insult or a negative word. He says words need to be reclaimed, and cites the Democratic Socialists of America as an example of socialism being used in a loaded way. He says he considers himself very moderate rather than a total libertarian, and that he likes capitalism and immigrants.

Parr argues that someone is needed who has a fairly common-sense approach, can bridge both sides, and speaks in plain language charismatically without being fear-based or saying the other side will ruin everything.

Puri says there are many things a politician such as Donald Trump says with which he agrees on policy, but he does not like how he talks or how he is rude to people. He says this creates an emotional barrier, so he does not want to support him.

Puri also says that he dislikes what he calls 'free stuff' rhetoric from the left, so he does not want to agree with either side. He says a policy such as free preschool does not sound bad, but the broader rhetoric is a problem. He wishes for a charismatic, fairly moderate, common-sense figure who could say AI is good and can help, America is amazing but has things to fix, capitalism rocks, and housing could be made more affordable with a safety net.

Puri says he is curious how America ended up where it is and that everyone can attach their own reason. He cites Charlie Munger's idea of the Lollapalooza effect: an extreme outlier usually results from a rare combination of seven or eight tailwinds at once.

Puri lists possible tailwinds: natural resources at the right time, culture and values, and a capitalist incentive system that let high-agency people build valuable things in competition with others, producing the best products and winner-take-all dynamics. He also suggests America's newness may have let it leapfrog, comparing it to Africa skipping landlines and going straight to mobile.

Parr notes that the colonies had about 150 years of practice running themselves before deciding to put their rules on paper and break from England, so they had a fresh start. Puri adds that a network effect exists: the best economy attracts the best people, who make the economy better still.

Parr says America is uniquely set up to be the petri dish where many of these things grow very quickly, so long as the country does not get in its own way. He compares this to a 7-foot-tall eighth grader drafted first overall: the advantage is there, and the only risk is blowing it. He says he understands the fear and pessimism because of the uncertainty, but is bullish that AI will make life better in America and around the world.

Parr then describes a cousin who recently became a free agent after selling his company. He says the cousin was about to do what many people do, looking inside the peephole and asking what the best visible option is, when the real task is to expand one's field of vision. People often look only at a narrow, limited set of possibilities based on whom they know, what jobs are nearby, or what they did in the past, even when the industry they are in lacks a big tailwind.

Parr says he wants someone to build these things even if he will not do it himself, noting that he is in a different season of life than he was in his twenties. Puri says moving geographically matters, but so does moving where the puck is going, and that AI in the world of things is where the opportunity will go over the next 10 years.

Puri says the value of each area is not simply 'here's how you make money' but how the world is about to change for the better, so that someone can have impact while building interesting new things and making money. He also says that even though they have not researched each topic deeply, they know enough to see opportunity in each one and can dig in to find the exact angle.

Puri says O'Reilly Media once presented the internet of things as the next big thing, with smart fridges and appliances talking to each other, but it never took off. Parr says it was about 25 years too early. The hosts joke that they now have to download an app to use things that do not need one, and that Puri has to log in to use his vacuum.