Cathie Wood: How to Invest in a World Moving This Fast

Equity Mates Investing Podcast

Cathie Wood, CEO of ARK Invest, discusses the accelerating pace of technological change driven by AI and its impact on various industries. S

Key takeaways

• Cathie Wood believes humanoid robots could be in homes within five years to drive down unit costs.
• Healthcare is a major AI opportunity, with companies like Freenome diagnosing colorectal cancer at stage one via blood tests.
• CRISPR Therapeutics is developing therapies for rare diseases and potentially common conditions like bad cholesterol.
• Wood remains bullish on Bitcoin, viewing it as a global monetary system and a new asset class despite recent market volatility.
• The 'big four' in crypto are identified as Bitcoin, Ethereum, Solana, and Hyperliquid.

Main topics

• AI Revolution
• Healthcare Innovation
• Cryptocurrency and Bitcoin

Notable quotes

Anything that's good for humanity is going to be highly valued.

Conclusion

The episode provides a forward-looking perspective on how converging t

Transcript preview

Speaker 3 (0:00) Everything you're about to hear is for education and entertainment purposes only. Whilst we are licensed, we're not aware of your personal financial circumstances. Any advice is general advice. Equitymates operates under Australian Financial Services License 540697. Speaker 1 (0:15) We're able to cure disease, and it's already happening. Closer to five years, I think, that we'll have humanoid robots in our homes. We believe we're in the early stages of the AI revolution. Anything that's good for humanity is going to be highly valued. Think about that. What I've just described is 25 years of the rubber band stretching. Speaker 4 (0:40) Welcome to another episode of Equity Mates, a podcast where we explore what's possible in the world of investing. If you've just joined us for the very first time, we have a huge episode for you today. And Speaker 3 (0:49) I'm Ren, and today we are speaking to Cathy Wood. She's the co-founder and CEO of ARK Invest. She's an investor well known for buying the forefront of innovation, and we're going to be talking all things technology, the pace of disruption. and where the world is going. Speaker 4 (1:07) Super excited for this one. We're Speaker 1 (1:08) going Speaker 4 (1:08) to get her thoughts on not only AI, which is where we're Speaker 1 (1:11) going Speaker 4 (1:11) to start the conversation, but she's been very bullish on Bitcoin. So we'll get an update on that. Bullish on Elon Musk. Elon Musk, yeah. Robo taxis, humanoid robots, Tesla. She is certainly not one to shy away from making high conviction calls on where the future of technology takes us. Or Speaker 3 (1:28) the future Bitcoin price, if you ask. And Cathie Wood shot to prominence in 2020 and 2021 in that. COVID period when the market was ripping and her funds were ripping as well. And then the funds fell in 2022 and 2023. We ask what she learned from that experience, how she manages risk across her portfolios and what's changed as we enter another technology boom in 2026. Fascinating interview. ARK have funds that invest in both the listed market and venture funds that invest in the unlisted market. So we get a good cross section of companies. at different stages in their life cycle. But to summarize it, Kathy's bullish. Kathy's bullish. Yes. All right. Well, nothing more to say. Let's get to our interview with Kathy Wood. Speaker 4 (2:16) Well, Cathy, welcome to Equity Mates. Speaker 1 (2:18) Thank you, Bryce. Happy to be here. Speaker 4 (2:20) We want to start with a theme from ARC's Big Ideas 2026 report, which is the great acceleration. Speaker 1 (2:26) People Speaker 4 (2:27) obviously intuitively feel the pace of change is accelerating. You just look at what's happened with AI over the last couple of years. But can you give us a sense of just how quickly technology is actually moving? Speaker 1 (2:37) We have even been surprised, and it takes a lot to surprise us because we're doing deep first principles research. And to see AI taking off as quickly as it is, well, we have some great leaders out there who are, you know, moving very aggressively. Then we've got China, who's really focused on the space. And I think there's nothing like competition to get us both going and accelerate the pace. I think the reason it's feeling so quickly is it's impacting every industry. So there are three. Well, many opportunities, but we think every company can harness AI and there are huge productivity gains. And what's happening is CEOs know, okay, we have to do this because we could be left out in the competition. So it's coming from the top down, but it's also coming from the bottom up because people, especially in or near entry-level jobs are saying, wait a minute, AI could take. my job. And so I better, I better use it to become more productive. And I always say, make your boss look brilliant and make sure I guarantee myself a place in this revolution. So top down, bottom up, buy company. That's the first thing that's happening. But then the other thing that's happening is something called embodied AI. And what that means is really the physical and the digital worlds coming together, that is also what's surprising because there's a lot of inertia in certain spaces. There's an accelerated pace of change in certainly transportation, for example, autonomous mobility. It feels very fast, but the first commercialization of a robo-taxi was in 2018. It was Waymo in the U.S. And so as we were doing our research, we thought it... Tesla would get there before last year, June of last year. Now we're seeing it is moving faster than Waymo. And it helps us explain or illustrate slowly, slowly, then all at once. It's not as though this happened overnight. The data collection, so Tesla has about 6 million, 7 million robots collecting data. I have two. Model Y and Model 3, collecting data. I have had my first one since 2018. It's been collecting data, sending it back every day to Tesla so Tesla could learn our roads through real-world driving as opposed to just simulation. So that's been a long time. That was 2018 for me. It was really 2015, so 11 years. So slowly, slowly, and then people say, yeah, yeah, yeah, this will never happen. And then, whew, all at once. And I think that's going to happen with robo-taxis. You may not feel it here as much in Australia because you need to build out your charging system for electric vehicles. And it took us a long time. We had a lot of range anxiety, too, when it came to electric vehicles. Now robo-taxis are going to be electric. So we needed that charging, that charging ecosystem so that they could be ubiquitous and Speaker 3 (6:03) not Speaker 1 (6:04) have to go down. So that's one manifestation of embodied AI. It seems like it might be happening fast now, but it took a lot of years to make it happen. Another one, humanoid robots. Again, Tesla, SpaceX will be, and they'll probably combine, will be at the bleeding edge of that. This is one where... Wouldn't we all love a humanoid robot at home to do all of our housework? Yes. Right? It's a dream. And many people, including Elon, are saying it'll be here in a couple of years. That's Elon time. It's probably going to be here in three to five years. And when I say that, for all of us to be able to afford a humanoid robot, we need the unit growth to pick up. in order to drive the cost down. Speaker 3 (6:55) And Speaker 1 (6:56) that's probably closer to five years, I think, that we'll have humanoid robots in our homes. That's going to be exciting. Again, slowly, slowly. What's going to be the holdup? Data. There's a company in our venture capital fund called Figure AI, and it has just given people cameras to wear and other sensors while they're doing their housework. And why is it doing this? Because there is no data on it. And for AI to really take off, you have to have a big body of data. And so I went out to visit a company called Physical Intelligence in San Francisco. The CEO will not allow any fund into its rounds unless someone from the IC committee, the investment committee, actually visits the CEO in person. which I did. Speaker 3 (7:49) And Speaker 1 (7:50) what was so interesting, I walked in and physical intelligence, humanoid robots and so forth, same thing. All of these people were there doing things physically so that the robot could learn from computer vision. But the data were in such early days there. And then in healthcare, it's all so slowly, slowly and all at once. I think healthcare is the most profound application of AI. We are now diagnosing cancer in stage one. And soon, thanks to the convergence of sequencing technologies and AI, we'll be able to diagnose cancer, we think, and other diseases before stage one. And just to give you an example, Freenome in our Venture Capital Fund actually was co-founded by one of the leaders of the Venture Capital Fund, who was an oncologist surgeon. and said, this is ridiculous. We need to get more data about cancer so that we can diagnose it so much earlier. So he became an expert in AI, and his company, Freenome, is now diagnosing colorectal cancer in stage one. But he believes, and this is just with blood tests, you don't have to get a colonoscopy. You're too young to have colonoscopies. I will be very happy not to have colonoscopy. But with blood tests, we're now able increasingly, this is in trials, to diagnose even the earliest stage of cancer or pre-cancer with polyps, which also shed into the blood if they are becoming cancerous. So think about that. Without AI, it would be impossible. sequencing technologies impossible. Those two coming together, diagnosing disease, curing disease, add another thing to the mix. Sequencing technologies, do you know how many cells you have in each of your bodies? Speaker 3 (9:54) No, unfortunately not. Oh, just Speaker 1 (9:56) take a guess. We normally ask Speaker 3 (9:57) the question. Trillions. Yeah, trillions. Speaker 1 (10:00) That's very good. Very well informed. The answer is you're very close. 35 to 40 trillion dollars, I mean cells, in each of our bodies. And so what are we? We are walking data factories because there's something called single cell sequencing now. Think about that. We're going to be able scientifically to know what's going wrong in our bodies. We could not do that before. But now, thanks to sequencing, AI, and CRISPR gene editing, we're able to cure disease, and