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Well, let's get back to the transit lanting tech route that we saw yesterday, one trillion dollars worth of course over Deep seeks dark horse entry to the AI race. The question is it a turning point for the industry and its investors. Joining us now to discuss is one of the most prominent voices in this sphere. Kathy would found at CEO and CIO of ARC invest. Lovely to have you with us, Kathy, Thank you, Lucy, happy with you here. Big question you buying the dip.
Well, we're fully invested, and we're very comfortable being fully invested. I think our confident in the ballmarket broadening out has increased in the last few days. So sure the megacaps we think will continue to do well. Maybe in Vidia there are some questions about its exalted position in the training chip market. We think inference is going to become more important with these new reasoning models, and that is
a more competitive part of the market. But we think that what's happening here is the collapse in the cost of innovation.
Deep Seek is adding to it.
It has been happening though AI training costs have been dropping, led by Nvidia seventy five percent per year, and AI inference costs have been dropping eighty five to ninety percent per year. Deep seek is just putting those very rapid declines into a bit of overdrive here.
So I wonder, if you see in Vidia falling much further, is this an attractive price to be buying it?
Do you think, well, we we own it in some of our portfolios.
We are not buying the dip yet.
We do want to learn more about deep seek and more about how the market or the demands and for inference chips might outpace those for training chips.
We think the whole area is going to be vibrant.
We just think there might be a little bit more of an adjustment to this new reality.
Where you say that what deep seat shows is kind of that you can do more with less kap X. Who do you think that's going to motivate in the US most as Donald Trump is kind of saying, who's going to be best at doing more with less?
Well, anyone using AI.
We are focused on the productivity gains for knowledge workers, which are going to be massive. That's the biggest impact of AI. But if we're looking at sectors and spaces generally where this acceleration and innovation is going to be meaningful. We think autonomous mobility, so robotaxis. We think that's going to scale from essentially nothing now to an eight to
ten trillion dollar globe opportunity, including China. But the sleeper here is healthcare, and we're seeing the convergence of sequencing technologies, all kinds of sequencing technologies, artificial intelligence, and then gene editing technologies like Crisper CAST nine. That combination we believe is going to cure disease. It's already curing disease, sickle cell disease and beta thllosemia. That's Chrisper therapeutics. But we think they're aiming now for type one and type two diabetes.
That would be a category killer, you know, So think about that curing disease, AI helping us decode the secrets of life, death health.
Those are two areas where regulation plays a big part. You've spoken about your optimism about deregulation under Donald Trump. Do you think those are two areas we should expect to see big deregulation about what technology can get in.
Yes.
I think in both safety first and I think anyone moving into this market or these markets would agree with that, so sensible regulation. But in the US, the robotaxi field is regulated by fifty states. We think that will change to one regulator, the federal government. After all, transportation does cross states, so that makes sense. In the healthcare realm, that is where the thicket of regulations has really strangled
the industry. And even more than the outright regulations, it was the FTC, the Federal Trade Commission not allowing mergers and acquisitions and therefore not allowing strategic buyers big biotech companies, not allowing them to the smaller companies, so that we had price discovery. Now we're going to see price discovery. How much are these companies that are curing disease worth to these large strategic buyers now and saying that I
don't necessarily want our companies to be taken out. We think they have miles to go, but we do want price discovery back in the market.
Where you talk about your excitement about autonomous vehicles. Of course, your biggest holding is Tesla, I think, and we've call Elon Musk's first earnings call tomorrow since Trump's returned to the White house January. Typically a call that's a look ahead. What do you need to hear from muskue.
We need to hear a continuation of we're about to launch our autonomous driving system. I mean, in effect, they've launched it. I have a full self driving I know it's not allowed here in the UK or in Europe, but.
You feel safe.
But oh yes, yes, yes, yes, Weymo really has broken through a lot of barriers. I feel even though a Waymo vehicle is not safer than a human driven vehicle, it knows its roads. It's narrow roads, meaning there are narrow territories. I think Tesla is going to go national. That's going to be and we'll be able to do so because it has effectively seven million robots roaming the roads. Right now, I have two of them, a Y and A three, and they're learning all about Connecticut and Florida
worlds roads. So it has a huge competitive advantage in terms of proprietary data that nobody else has about the roads, not only in the US, but in many places around the world.
Do you worry that Elon Musk is taking on too much? If he's got his new job in the US government, he's got you know, sharp developments coming in Tesla, lots going on with those other businesses as well. Is he spreading himself too thin?
If you look at the way Elon Musk behaves as a CEO, he's a sharpshooter. He looks for pain points and he solves those right. And he's for example, right now, where was in twenty eighteen, where was the biggest pain point? It was manufacturing the Model three, scaling the Model three. He slept famously on the factory floor. He's not doing that anymore. He's not on the factory floor now. It's
all about autonomous. He is the first what we would call CEO who really understands the convergence among technologies taking place right now, really catalyzed by artificial intelligence each one of his businesses. And he also understands how critically important proprietary data is. And think about this, Each of those companies is generating proprietary data that no one else has.
Well, maybe you should out to his plate. Should he buy us TikTok ah?
Yes?
I mean, I know there have been rumors about that and about the government sharing half, and that's kind of anathema to the United States, you know, the government getting.
Involved like this. I'd be surprised if that happens.
But I will also say the Trump administration is full of surprises.
It certainly is, and we're only a weekend to it. You're here with us in London and we're delighted to see you. What has you in London? What opportunities are you excited about when you come to the UK. Is this a good place to put your money?
Well, we have launched three funds. Our Europe has launched three funds here. One is our flagship that is focused on all five innovation platforms, so robotics, energy storage, artificial intelligence, multiomic sequencing and blockchain technology. So that's the flagship AARKK a special one for Europe which we do not have in the US because of overlaps with other funds, But we have an AI and robotics fund and that is ARKI.
We think this convergence of robotics and AI is going to lead to humanoid robots and you know, not just millions of them, but perhaps billions of them longer term, which is going to be a key productivity driver in both the home. You know, right now we're not paid for house cleaning let's get a robot. Let's pay a robot to do it, and in the manufacturing plants around the world.
Kathy, the Prime Minister was in the building earlier. Kara Starmer, you're exactly the sort of person that he wants to meet because he wants investments going into those sorts of businesses in this country. Have you spoken to what sort of advice would you be giving him if he's trying to grow the economy.
Well, half the solution is understanding the problem. And just making that statement suggests to me that he's saying, why hasn't this happened? And I also over the weekend heard one of the finance ministers or maybe the Finance Minister say the same thing. This is a mantra, and I think it has been catalyzed by artificial intelligence as well.
If you think about the UK, you produced two of the most important AI companies in the world, Deep Mind, which Alphabet now owns, an arm which SoftBank primarily owns. By all rights, you should be developing a deep venture capital pool here, feeding startups and nourishing them and deepening your listed equity markets. And so I think that's what they're going to do, which is fantastic, fantastic for the UK.
Absolutely, they talk very ambitiously the UK leadership, but so too do the European government's leadership. And Donald Trump, as you say, is very passionate about deregulation. So yes, everybody's on the same page. But it is a race. Is the UK keeping up enough with the EU and the US when it comes to deregulation for you to be really confident, Kathy putting your money here.
I think that Europe is more tied up in regulatory nuts than the UK is. And in fact, some of our companies, Pallenteer has been very vocal, for example, and we think that's one of the most important AI platform
companies out there. Alex Krp, the CEO, has said, I am pulling employees out of Europe because you know, we're running into all of these obstacles that could really harm us, you know, being hit by a four percent fine, four percent of revenue or and that's global revenue or seven percent of revenue I heard recently.
That's crazy.
So I think Europe is going to be held back until it gets its regulatory act together. I think the UK is more progressive from a regulatory point of view, and as I said, I really believe that half the solution. The fact that your Prime Minister, your Finance Minister in the same week are saying, you know, we've got to figure this out. I think that's a very good thing for the UK.