Capital, Compute, and the Fight for AI Dominance

February 20, 2026

Here’s something that really caught my attention — this AI investment boom isn’t like anything we’ve seen before. According to content+a16zpodcast@a16z.com, Martin Casado and Sarah Wang from a16z explain that the lines between venture and growth, apps and infrastructure are blurring fast. What’s wild is that frontier model companies are raising more money than all the companies built on top of them combined. Now, here’s where it gets fascinating — there’s a huge gap between how people perceive AI’s progress and what’s actually happening behind the scenes. As they point out, this industry-wide disconnect is wider than ever, and it’s shaping investment strategies in real time. So, what does this mean for you? The AI race is accelerating, and the winners will be those who understand not just the tech, but the money and perception game too. Honestly, it’s an exciting — if unpredictable — time, and these insights from a16z offer a clearer look at what’s coming next.

a16z's Martin Casado and Sarah Wang join Latent Space hosts Alessio Fanelli and Swyx to discuss what makes this AI investment cycle unlike anything in the history of venture capital. They cover why the lines between venture and growth, apps and infrastructure are blurring, how frontier model companies can raise more than the aggregate of everyone built on top of them, and why the industry-wide gap between perception and reality has never been wider.

Stay Updated:

Find a16z on YouTube: YouTube

Find a16z on X

Find a16z on LinkedIn

Listen to the a16z Show on Spotify

Listen to the a16z Show on Apple Podcasts

Follow our host: https://twitter.com/eriktorenberg

Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see a16z.com/disclosures.

Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Audio Transcript