Oct 19, 2026 · 24 min
Quantum advances meet the hard economics of moonshot investing
Investors Shoot for the Moon
The episode tests whether breakthroughs in quantum computing, energy, mobility, and AI can become investable businesses before economics catch up.
- 1Quantum progress is accelerating, but error correction and limited investment options keep the technology difficult to value.
- 2Fusion and nuclear power offer ambitious energy possibilities, yet falling renewable costs could undermine their commercial case.
- 3Open-source AI may benefit cloud infrastructure while weakening pricing power, creating valuation risk for seemingly cheap companies.
Don't miss
Matt explains how declining pricing power from open-source AI could make a company’s effective valuation much higher than it appears.
The brief
Jon Quast, Matt Frankel, and Tyler Crowe begin with quantum computing, where advances from Google and Quantinuum meet the stubborn problem of reducing errors.
The hosts weigh diversified exposure through IBM against a more concentrated bet on Quantinuum, framing a broader choice between established companies and pure-play moonshots.
Their moonshot survey spans fusion, small modular reactors, eVTOL aircraft, and autonomous driving, but excitement about the technology outpaces confidence in viable business models.
The mailbag turns to open-source AI, where Tyler points investors toward infrastructure and beneficiaries of the buildout rather than only major model developers.
Matt’s valuation warning is the episode’s sharpest point: if open-source models reduce pricing power, a company’s effective price-to-earnings ratio can rise even without a higher share price.
What was said on this episode
14 statements · 3 positive · 11 negative
Useful quantum computing remains years away.
“We're still years away.”
Listen at 8:09
Quantinuum’s valuation reflects sales expected in 2030.
“With plays like Quantenum, you're essentially paying for 2030 sales today.”
Listen at 8:21
Quantinuum has been developed within Honeywell’s ecosystem for decades.
“this is something that's been working on for decades”
Listen at 9:04
Everyday investors generally benefit from revenue businesses with moonshot exposure.
“the best setup honestly for everyday investors is usually a real revenue business that has a moonshot attached”
Listen at 13:40
Electricity is the biggest bottleneck for deep-tech areas discussed.
“Electricity is literally the biggest bottleneck for pretty much everything else that you mentioned”
Listen at 13:57
Solar may become more efficient before novel power technologies become commercially viable.
“renewable energy is still moving so rapidly down the cost curve that it's going to be, you know, maybe 10 years from now when these moonshot novel power generating techniques are commercially viable, we're even going to see greater efficiencies that solar.”
Listen at 14:56
Current eVTOL, airborne mobility, and autonomous-driving offerings lack viable economic models.
“I just, I don't think anyone's developed a viable economic model for it yet.”
Listen at 17:06
Tyler is not ready to invest substantial capital in these mobility areas.
“I'm not. really sure i'm ready to like throw a lot of capital at any of them as an investor”
Listen at 17:14
Open-source AI models could significantly harm some companies.
“these open source models could be a major headache for a lot of companies”
Listen at 20:03
Sufficiently capable, cheaper open-source models could disrupt AI providers.
“If they become the, you know, sufficiently good, but at much cheaper prices.”
Listen at 20:26
Closed AI models account for roughly 90% of enterprise AI production.
“It makes up roughly 90% of enterprise production in AI.”
Listen at 21:43
Open source threatens AI companies’ pricing power more than cloud providers.
“Where open source is the real threat, and it's not to these three companies, is pricing power.”
Listen at 21:52
Losing pricing power can reduce a company’s profits substantially.
“If the pricing power goes away, the profits go down to say 2 million.”
Listen at 22:30
Lower earnings can raise a stock’s price-to-earnings ratio to 50 times.
“Now it's trading at 50 times because the earnings went way down.”
Listen at 22:37
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.
Books & mentions
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