The next wave of AI will be for the physical world.
AI, sensing, robotics and control now make previously unautomatable work feasible.
Investment Thesis
The next AI wave will be measured in output.
As intelligence moves from screens into machines, factories and infrastructure, durable value accrues to the technologies that remove constraints on deployment and expand industrial output.
Three linked convictions
Bottlenecks decide where value accrues.
Every constraint removed from the physical stack creates a new strategic layer.
Critical-industry demand is durable.
Labor scarcity, fragile supply chains and uncertain geopolitics create persistant demand.
Why now
Reindustrialization
Production capacity is being rebuilt closer to end markets.
Labor scarcity
Automation must extend scarce skilled labor and lift every worker.
Technical convergence
Cheaper sensors, better actuators and software-defined hardware.
Sovereign urgency
Resilience and defense readiness are now procurement priorities.
Talent migration
The best engineers want work with physical consequence.
What we back
Enabling layers, not isolated products.
Our focus is not predicting the most visible end application. Rather, it is on identifying the indispensable enabling layer before the market recognizes the constraint.
Software-enabled Hardware + Physical Intelligence
Perception, planning, control and robotic machine systems that perform massively useful work.
Sensing + Perception
Inspection and feedback loops that make systems precise and trustworthy.
Connectivity + Communication
Data movement that keeps autonomous machines coordinated and responsive.
Advanced Manufacturing + Materials
Production methods, materials, and architectures that make the factory a strategic advantage.
Power Generation + Distribution
Energy supply chains, power electronics, thermal systems and distribution that enable performance.
Space Infrastructure + Performance
Next Gen space craft, propulsion, awareness and responsiveness to unlock capabilities and value from the final frontier.
Seven underwriting tests
Criticality
Does the problem constrain output, resilience or strategic capacity?
Urgency
Is there a customer with a real budget, timeline and cost of inaction?
Bottleneck leverage
Does solving it unlock disproportionate value downstream?
Durable advantage
Is the performance edge hard to reproduce and able to compound?
Deployability
Can it be manufactured, integrated, serviced and trusted in the field?
Platform path
Can the beachhead expand across customers, workflows or markets?
Venture return
Can entry price, ownership and scale create fund-returning outcomes?
Values
Guiding our decisions and building lasting value.
Build what matters.
We direct capital, time and relationships toward solving really hard problems that society is desperate for. We favor essential systems over novelty and substantial outcomes over narratives or short term results.
Remove critical constraints.
Industrial systems scale only as fast as their hardest bottleneck. We look for the enabling layer whose removal unlocks disproportionate output and value.
Bet on exceptionalism.
We do the work to identify teams that are exceptional all around - in their technical prowess, their business acumen, and in their resiliency.
Compound conviction.
We invest early, stay close and update our view with evidence and context. When technical achievement becomes a durable commercial advantage, we deepen exposure.
Earn trust over decades.
Candor, integrity and alignment are strategic assets. We seek to communicate clearly, and always protect confidences, honor commitments and treat founders, LPs and partners as long-term relationships.
Act with urgency. Think long term.
Critical markets move slowly—until they do not. We respond quickly and pursue milestones with intensity while maintaining the patience required for deep technology to compound.
What we are not interested in
- —Automation for automation's sake
- —Policy-dependent impact strategy
- —Technology in search of a customer
- —Commodity hardware without a proprietary layer
- —Project businesses without scalable economics
The internal decision rule
If this company succeeds, will a critical industry be able to generate greater output — operating faster, safer, more reliably and with greater strategic independence?
In our increasingly polarized world, everyone should be rooting for Output's portfolio companies.