The Next Big Investment Opportunity

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To investors, An investment has to have three components to present an attractive risk-reward of true asymmetry: A breakthrough technological innovation A small market with potential to grow into a mega market in the future An early cohort of missionary founders/investors hyper-focused on disproving the non-believers The most obvious example of these components coming together over the last decade was bitcoin and crypto. The results speak for themselves as the industry presented one of the best financial returns for investors. I am obviously a very big believer in bitcoin and continue to see a bright future for the asset. But I also understand that the significant asymmetry has dissipated as bitcoin has become bigger and received more adoption in the institutional world. So what is the next market where asymmetry exists? What type of opportunity has the three key components for an attractive risk-reward? Physical AI and robotics. This is a corner of the artificial intelligence industry that is often overlooked and under-discussed. A big reason is that almost every company is in the private market and still relatively small. In addition, reporters or market commentators can easily use Chat-GPT, Claude, or other software products, but it is much harder for robotics to stay top of mind when people are not using them on a daily basis (yet!). In order to understand the opportunity set better, I recently interviewed Andrew Kang, CEO of Robostrategy (Nasdaq: BOT), to get his take on what is happening in the industry. For those that don’t know, Andrew is one of the best investors in the world over the last decade, yet he is relatively unknown to the mainstream audience. His 400,000 followers on X are constantly looking to him for insights on the next investing themes and trends, which is why Andrew’s decision to launch a publicly-traded fund that gives exposure to the top private robotics companies is so interesting. After talking to Andrew, I made an investment in Robostrategy because I believe their portfolio contains many great assets and I have confidence that his team of robotic experts will continue to find the next great humanoid or robot-related companies. You can listen to the interview here or you can watch the interview on YouTube . You can check out Robostrategy’s website here . I asked Chat-GPT to summarize my conversation with Andrew. Here is the summary: Humanoid Robots Are Much Closer Than Most People Realize Kang argues that humanoid robots are no longer a distant sci-fi concept. He believes society will begin seeing robots integrated into everyday life within the next 3–5 years. These robots will work in factories, restaurants, warehouses, and eventually homes because they are adaptable to the same environments humans already operate in. The Total Market Opportunity Is Measured in Tens of Trillions of Dollars One of Kang’s core investment theses is that humanoid robots will replace a meaningful portion of human labor, which represents roughly half of global GDP. He walks through simple economics: if a robot costs ~$50,000 and can perform the work of multiple humans at a cost of roughly $2 per hour, the economic incentive for adoption becomes overwhelming. He believes leading robotics companies could eventually reach multi-trillion-dollar valuations. Artificial Intelligence Was the Missing Piece Historically, robotics struggled because machines lacked intelligence. Kang explains that advances in large language models and AI systems changed the equation. In his view, physical intelligence is now following digital intelligence. Once robots can understand their environment and adapt to changing conditions, many of the historical barriers to adoption disappear. Why He Made Massive Investments Into Figure AI Kang describes how most venture capitalists initially discouraged him from investing in Figure AI. He believed investors were anchored to decades of disappointing robotics outcomes and underestimated how AI would transform the industry. After extensive research, he increased his exposure dramatically because he became convinced Figure had assembled one of the strongest teams in the world and was executing faster than competitors. The United States vs. China Robotics Race A substantial portion of the conversation focuses on geopolitical competition. Kang acknowledges China’s dominance in manufacturing and hardware supply chains, but argues that the United States currently has an advantage in advanced AI and robot intelligence. He believes the winning robotics companies will need excellence in three areas: manufacturing, hardware design, and AI. His view is that China may produce many robots, but American firms could still create the most shareholder value. Robots Will Cause Massive Labor Displacement Unlike many technology executives who emphasize job creation, Kang is unusually direct about employment risks. He believes AI and robotics will eventually replace both physical labor and many cognitive jobs. Since robots may ultimately surpass humans in both domains, he argues that society will need entirely new economic safety nets. Universal Basic Income (UBI) is one solution he repeatedly mentions as a likely necessity. The Future Home Will Include Humanoid Assistants Kang expects humanoids to become common household products. He envisions robots cleaning homes, helping with chores, assisting elderly family members, and eventually serving as personal assistants. He compares future human-robot relationships to how people already interact with ChatGPT and other AI systems, suggesting that emotional attachment and trust in machines will become increasingly normal. Training Data Is Less of a Constraint Than People Think The conversation explores how robots learn. While some companies are collecting real-world training data through teleoperation and human demonstrations, Kang argues that advances in video models and world models have changed the landscape. Robots can learn from enormous amounts of internet video data, reducing the need to manually collect every piece of training information from scratch. Robotics Investing Could Mirror the AI Boom Kang believes robotics today resembles AI a few years ago. Just as a handful of AI companies like OpenAI and Anthropic generated extraordinary value, he expects a small number of robotics firms to emerge as dominant winners. This conviction led him to create Robo Strategy, a publicly traded investment vehicle designed to provide broad investor exposure to the sector. Robo Strategy’s Goal Is Bigger Than a Typical Venture Fund Kang explains that Robo Strategy is not simply a collection of robotics investments. His vision is to create one of the largest robotics-focused investment platforms in the world. By using public markets rather than traditional venture capital structures, he hopes to raise far more capital, provide retail investors access to private robotics companies, and potentially reshape how venture capital itself operates in the future. Key Takeaway The overarching message of the podcast is that humanoid robotics is the next major technological platform shift after AI . Andrew Kang believes most investors are dramatically underestimating both the speed of adoption and the scale of economic value creation. 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