Show Notes
AI is still in the foothills of enterprise adoption, but the infrastructure buildout required to support it is already reshaping energy markets, capital allocation, and industrial policy. Data centers are driving demand for new generation and transmission, while billions of dollars flow into the hardware and software needed to train and run increasingly powerful models.
That makes energy infrastructure a big constraint in the AI buildout race. Data centers require more power generation, transmission, grid capacity, and additional physical infrastructure; all major investments. And those energy systems will have impacts on the cost of running potentially more power-hungry frontier AI models. That’s a lot of uncertainty even before considering the economic transformation still to come.
If AI moves beyond software and begins to fundamentally change how services like law, accounting, insurance, and finance are delivered, it could reshape a far larger part of the economy and create a new wave of demand for both digital and physical infrastructure.
In this episode of Critical Capital, Alfred Johnson sits down with Jake Saper, a partner at Emergence Capital and an early investor in enterprise software and AI infrastructure. Saper argues that the biggest transformation from AI may not happen inside software companies at all. Instead, it could reshape the much larger services economy, creating a new category he calls AI-native services (AINS).
Saper explains why he believes companies built from scratch around AI may have an advantage over traditional service-business roll-ups, and why the biggest challenge for these companies is delivering their services with AI rather than simply adding more human labor. The conversation also explores the increasingly blurry line between software and physical infrastructure.
Critical Capital is a co-production of Crux and Latitude Studios. Learn more about how Crux is financing the future of energy.
More from Critical Capital
Have feedback on Critical Capital? Fill out our listener survey to let us know what topics and guests you’d like to hear next!
If there’s one thing stakeholders in the energy sector can agree on, it’s that new infrastructure needs to get built faster and more reliably. A recent Crux study, for instance, found that federal permitting delays hamper clean energy projects for an average of six months; cancellations due to endless litigation are common.
The rush to build data centers has sparked an energy debate: will gas meet the growing demand or will clean firm power like nuclear step in? Nuclear has bipartisan support, new contracts from tech companies, and the capital to build. What it needs, according to Lara Pierpoint, is to be built on time and on budget with government support that lasts.
Home energy has spent most of a decade being sold as a premium product, priced at a margin homeowners would pay for something they wanted. Zach Dell says there’s a better way. He argues that electricity is a commodity, that the cheapest version is the best one, and that getting there means owning the supply chain that produces it.
American industry is building factories, mines, and grid hardware at a scale not attempted in decades, and the capital is there. But Erin Price-Wright says the cost of money no longer sets the return on an industrial project. It’s the time spent waiting on a regulator.