As the debate around artificial intelligence (AI) shifts from possibility to positioning, investors are presented with a unique opportunity to identify and invest in emerging technologies that have the potential to revolutionize various industries. However, this adolescent phase of AI also brings volatility, exaggerated narratives, and uneven outcomes, which can make it challenging to navigate the landscape.

Dario Amodei’s essay “The Adolescence of Technology” provides a conceptual anchor for understanding the current state of AI. According to Amodei, AI is in an adolescent phase where capabilities are advancing rapidly, but institutions, business models, and governance lag behind. This creates a situation where long-term winners begin to emerge, but the impact of AI will not be linear, with second-order effects mattering most.

Matt Shumer’s widely shared VC essay captures the narrative inflection point, as a growing conviction among builders and investors suggests that something structurally significant is underway. AI is changing what small teams and software platforms can achieve, pulling capital and talent forward even as monetization remains uncertain.

The Polar Capital News & Views podcast brings the investor lens to the discussion, asking what’s already priced in, which parts of the AI stack are crowded, and where expectations still underestimate duration or quality. The message is familiar: early infrastructure re-rates first, but durable returns often come later through defensibility, integration, and real productivity gains.

Investors must be aware of these trends and navigate the landscape with a long-term perspective. Identifying emerging technologies and understanding their potential to disrupt various industries is crucial. However, it’s also important to recognize that the AI adolescence is characterized by volatility and uneven outcomes, which can lead to overhyping and overinvestment in certain areas.

To succeed in this landscape, investors must be selective and focus on identifying areas with strong fundamentals, such as early infrastructure re-rates, defensibility, integration, and real productivity gains. By taking a long-term view and navigating the challenges of AI’s adolescence, investors can uncover opportunities for growth and profitability in this rapidly evolving field.