Dear Readers,
Elon Musk started production of his Optimus robots this week.
And he made something very clear.
Tesla's future is in robotics, not cars.
That's a direct quote.
So I went and looked at the data.
And what I found confirms something we've been talking about here for a long time.
The Numbers
Robotics and physical AI startups raised a record $18.6 billion across 450 deals in the second quarter of 2026 alone.
That's from PitchBook, the institutional research firm.
Historic. Record. Gangbusters.
And it's happening in both the US and China simultaneously as both countries race toward the same finish line.
Jensen Huang, the CEO of Nvidia, said it a few months back.
Robotics has had its ChatGPT moment.
He was talking about the kind of big bang that AI had in late 2022 when ChatGPT launched and changed everything overnight.
Jensen is saying robotics is undergoing that same inflection right now.
The data proves he's right.
Where the Money Is Going
Defense and security remains the largest robotics segment by far.
And that shouldn't surprise anyone who's been following this channel.
Think about what we've watched unfold in Ukraine and Iran.
Iranian drones — the guys who used to make roadside bombs figured out how to stick them on a little flying machine.
That's primitive robotics.
But it's robotics.
And it's changing warfare.
The world is entering a new cycle of geopolitical competition.
China is trying to push America out of the center the same way Germany tried to topple the existing world order in 1914.
The country that masters robotics first is going to have a seriously large military and economic advantage.
Let's hope that's the good guys.
The EI Era Is Here
The other shift worth understanding is where the momentum is moving within robotics.
AI and autonomy platforms — the software and intelligence that makes robots actually work — attracted $7.7 billion in funding last quarter.
And actuators, motion systems, end effectors, and tooling are also seeing sharp growth.
That's the physical side — the technologies that let robots actually interact with the real world.
Here's why that matters.
Right now, robots tend to do well in controlled environments for about 90 minutes before they start running into trouble.
The billions being poured into actuators and motion systems are specifically aimed at solving that problem.
Getting robots to function reliably in the messy, unpredictable physical world.
This is what we've been calling the “EI era” — embodied intelligence.
AI jumping off the screen and into the physical world.
We even wrote a report about the top EI stocks you can invest in today.
If you haven’t read it yet, make sure to check it out now.
For better and for worse, the world is going to look very different in 10 to 20 years.
I personally will not have a robot running around my house doing my laundry.
I saw The Terminator.
I'm not that stupid.
But my kids and their kids?
They're crazy enough to do it.
The Wayne Gretzky Rule
VCs are at the party first.
That's always how it works.
They're in Silicon Valley and New York, talking to young founders at MIT and Stanford who have technologies that might solve the next big problem.
And right now, they're pouring money into robotics because they know where the puck is going.
Wayne Gretzky didn't skate to where the puck was.
He skated to where the puck was going to be.
That's what the smartest money in the world is doing with robotics right now.
Jensen Huang is seeing things behind the curtain that we can't see yet.
But I believe the public big bang moment is coming very soon.
And when it gets here, things are going to go crazy.
We're going to make sure we're positioned before that happens.
And I would start with these stocks right here.
Have a wonderful day.
I'll see you tomorrow.
“The Buck Stops Here,”
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Written by Dylan Jovine