Which Companies Can Build AI Moats

Everyone's feeling jumpy about AI right now—and for good reason.

The hype has been massive. The investment has been astronomical. But where's the actual return?

In this episode, Azeem Azhar, founder of Exponential View and advisor to tech leaders and governments, breaks down why the next 18 months are make-or-break for AI. Companies need to prove there's real ROI, not just prototypes launched and tokens spent.

We cover:

• What hard evidence would actually prove AI is working (hint: it's not usage metrics)
• Who can build a real moat with AI—and why the winners will likely come from unexpected places, as they have in previous tech transformations
• The physical constraints nobody wants to talk about: chips, data centers, power grids, and whether America's infrastructure is up to the task
• Why OpenAI's "ubiquity strategy" might be spreading too thin (and what Anthropic is doing differently)
• The "pragmatic addicts" problem: we're dependent on AI even though we don't trust it
• How Azeem and his team use AI to be more productive, how they automate whatever they can, and why individual contributors are acting more like managers (of AI)

Note: This interview was recorded months before the "SaaSpacolypse" (big market drop) of Feb 2026; the analysis is as relevant as ever. 

Chapters

• (01:51) - Why the next 18 months are the crucible for AI
• (04:09) - What hard evidence would actually prove AI ROI (not token counts!)
• (06:55) - Why it's so hard to measure AI's real impact
• (09:55) - Who can build a moat with AI? Winners will be in "odd places"
• (12:56) - Structural data advantages: why Waymo's edge is hard to replicate
• (14:34) - Coding agents and whether developers will become disillusioned with them
• (18:21) - Physical constraints: chips, data centers, power, and America's grid problem
• (21:25) - How the Gulf countries became an unexpected AI hub
• (28:32) - "Pragmatic addicts": why 75% of Americans distrust AI but use it anyway
• (32:15) - The narrative of AI can be very unappealing: heaven on Earth or dystopia
• (35:06) - How Azeem's team uses AI: augmentation vs. automation
• (40:36) - What should we be talking about besides AI?
• (44:16) - Sounds like science fiction: What Azeem can't believe is real and here today

Links & Resources:

• Exponential View: https://www.exponentialview.co/
• Azeem's Boom or Bubble dashboard: https://boomorbubble.ai/
• Azeem's New York Times piece on America's electric grid challenge: https://www.nytimes.com/2024/12/28/opinion/ai-electricity-power-plants.html
• More on the “MIT Study” claiming 95% of AI projects fail that Azeem and I both found to be really poorly done, but that is nonetheless is quoted by everyone: Here’s Azeem tearing the study apart with data: https://www.exponentialview.co/p/how-95-escaped-into-the-world
• And here's me riffing with Kwaku Aning on it. You know why Azeem liked my take? Because I actually read the thing, unlike ~95% of the writers out there who just quoted that 95% number: https://www.futurearound.com/p/did-anyone-actually-read-that-mit-ai-study-that-made-the-markets-swoon-i-did

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Music by Jonathan Zalben