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  • Ken Griffin on AI, the Golden Age of Entrepreneurs, and the Taiwan Chip Risk That Would Cut US GDP 8 Percent: Inside the Citadel Founder’s Goldman Sachs Great Investors Interview

    Ken Griffin, founder and CEO of Citadel, sat down with Goldman Sachs’ Raj Mahajan at the firm’s Apex Symposium (recorded June 2, 2026) for this episode of Goldman Sachs Exchanges: Great Investors. It is their third public conversation in seven years, and Griffin is unusually candid: about the Friday he went home “shocked and depressed” over AI, the agentic system inside Citadel that compresses six weeks of PhD-level work into two hours, why a Chinese move on Taiwan would throw the US into a depression within six months, and the one question every hedge fund investor should ask their GP.

    TLDW

    Griffin names his two proudest leadership calls: dragging Citadel back to the office five days a week before it was acceptable (citing Fed research that remote work has hurt young Americans’ employment more than AI has), and Citadel’s pandemic role, from getting the FDA to approve experimental COVID drug trials in 72 hours to shaping the incentive design behind Operation Warp Speed, which he credits with saving roughly half a million American lives. On markets, he explains why the S&P sits at all-time highs despite wars in the Middle East and Europe: US energy insulation, stunning Chinese oil demand destruction, and record corporate earnings. On AI, he distinguishes hype from reality (a dinner of multinational CEOs gave him five stories of “AI transformation,” none of which were actually AI), then describes the internal breakthrough that changed his mind: an agentic system that reads, reproduces, and out-of-sample-tests academic finance papers in 2 to 3 hours instead of 6 to 8 weeks. The consequences: no layoffs at Citadel, but competitive moats across the economy are being filled in at lightning speed, setting up a golden age of entrepreneurship. He covers the compute market (all available compute is utilized all the time; market makers now spend hundreds of millions a year), China’s lead in roughly 67 of 74 critical technologies, the Taiwan scenario in which losing TSMC chips cuts US GDP 8 percent in six months, an energy doctrine built on nuclear, natural gas, and building data centers (with their own generation) in America, his stress-test approach to tail risk (definable, tolerable, still in business), and hedge fund economics: the industry’s cost of capital is roughly risk-free plus 4 percent, which is why Citadel has returned $25 to 30 billion to its LPs.

    Thoughts

    The most useful thing in this conversation is Griffin’s two-sided read on AI, because he refuses to pick a lane. The paper-replication story is the cleanest documented example yet of AI eating not just white-collar work but masters-and-PhD-level work, from the man whose firm profits from that labor. Yet in the same breath he reports zero headcount reduction, because Citadel has more problems to attack than people to attack them. Both things are true at once, and he names the synthesis honestly: the individual firm gets more productive while every firm’s moat gets shallower. Most commentary picks either the doom frame or the productivity frame. Griffin holds both, and his conclusion (a golden age of entrepreneurship, startups running on a few AI systems instead of 30 to 40 employees) is the actionable part.

    His dinner-party anecdote deserves to be a standard reference. Five global CEOs effusing about AI transformation, and every single story was actually machine learning, optimization, or plain digitization. The C-suite cannot tell AI from technology at large, which means a meaningful slice of the “AI is transforming our business” narrative priced into the S&P is really a decade-old digital revolution wearing a new label. That is not a bearish observation, since the earnings are real either way, but it matters for anyone trying to figure out which companies actually have AI leverage and which have rebranded their IT budget.

    The Taiwan section is the starkest risk framing you will hear from someone who runs both a hedge fund and one of the world’s largest market makers. An 8 percent GDP contraction in six months is not a market correction, it is Boeing halting production, new cars stopping, and consumer electronics freezing simultaneously, because TSMC chips are in every high-end product made. What makes his version distinctive is the second-order point: in a Taiwan blockade, he does not expect unified Western sanctions. Europe’s membership on “team USA” is less clear than it was two years ago, and the Middle East will play Switzerland because China buys its oil. Investors should notice that his answer to “how do you hedge this?” is not clever derivatives, it is his stress-test doctrine: know the worst case, size exposures so the loss is definable and tolerable, and stay in business to fight back.

    Finally, the small structural details are where the conversation earns its Great Investors billing. Compute has become a commodity input like jet fuel, fully utilized at all times and allocated purely by willingness to pay, which quietly favors high-margin businesses and squeezes everyone else. Alternative data made the present transparent, so the remaining edge in stock picking is multi-year vision about which companies are building transformative products. And the hedge fund test he closes with is one any allocator can use tomorrow: is your GP in the asset management business or the performance business? Citadel returning $25 to 30 billion to LPs is what the performance answer looks like in practice.

    Key Takeaways

    • Griffin’s proudest leadership call was bringing everyone back to the office five days a week, extremely early and against the culture, because humans are social creatures who learn through apprenticeship and mentorship.
    • He cites a Fed paper on reduced employment among workers under 30: remote work turns out to be a more important factor in diminished opportunities for young Americans than AI.
    • At the start of the pandemic, a hospital-system CEO called Griffin because he could not get FDA approval for drug trials on ventilated COVID patients; Citadel’s team got experimental trials approved in about 72 hours.
    • The key insight behind Operation Warp Speed, which Griffin discussed at length with Jared Kushner, was an incentives fix: the US government paid pharma to manufacture vaccines before FDA results existed, collapsing time-to-market from months to days.
    • By his math, the country spent a few billion dollars on that risk, saved a few trillion dollars of GDP, and saved roughly half a million American lives.
    • The S&P is at all-time highs despite a Middle East war, a still-raging war in Europe, and a potential skirmish over Cuba, because the US is relatively shielded from the energy shock.
    • China’s oil demand elasticity stunned even Citadel’s commodities business, one of the largest in the world; that demand destruction plus episodic oil flows out of the region has kept crude near the low $100s instead of the nearly $200 most models predicted if the straits closed.
    • Citadel has been a huge user of machine learning since TensorFlow arrived roughly a decade ago; the current wave is an acceleration of a digital revolution already underway, not a clean break.
    • At a dinner two years ago, Griffin asked global multinational leaders to share how AI was transforming their businesses: he got four or five great productivity stories and not one actually involved AI. They were machine learning, optimization, and digitization.
    • In the C-suite the nuance between AI and technology at large gets lost, but bigger budgets and CEO enthusiasm are pushing through real projects with real bottom-line impact; US corporate earnings are at all-time highs and multiples have actually come down as a result.
    • The use case that sent Griffin home shocked and depressed: a Citadel team member built an agentic AI system that reads an academic finance paper, reproduces it, verifies the published results, and tests them out of sample in 2 to 3 hours on average.
    • That same replication work previously took a legion of young masters and PhD hires roughly six to eight weeks per paper; Citadel finds a few tradeable ideas a year this way, and a few ideas can be worth a lot of money.
    • The point he stresses: this is not just a white-collar job being automated, it is a master’s or PhD-level job, and AI is now cracking problems (like the 80-year-old math problem OpenAI solved) that seemed beyond its reach two or three years ago.
    • Despite the breakthrough there has been no reduction in headcount at Citadel: the firm has more problems to attack than people, so Griffin takes every productivity gain he can get.
    • The flip side is that competitive moats across corporate America are being filled in at breathtaking speed, which Griffin expects to produce a golden age of entrepreneurial activity.
    • His example: a startup that would traditionally need 30 or 40 employees now runs with just a few AI systems, letting entrepreneurs take on incumbents in ways impossible 5, 10, or 20 years ago.
    • Some workers face genuinely hard transitions (his example is English-to-German translators), and the country needs to figure out how higher education can retrain these people quickly.
    • Stock picking remains a timeless business with a similar skill set, but the market will increasingly reward multi-year vision about which companies are creating transformative products rather than skill at calling quarterly earnings beats.
    • Alternative data (Citadel has access to the credit card spending of millions of Americans) made the here-and-now transparent a decade ago; AI plus bright people now triage the present almost instantly, so relative value accrues to those who can see years ahead.
    • At Citadel Securities, transformer models continue a decade of ML-driven improvement in pricing and risk management, and the same is true at other leading market-making firms.
    • For all intents and purposes, all available compute in the world is utilized all the time; access is decided by who will pay the most, and the per-unit price has risen beyond what anyone reasonably projected two or three years ago.
    • Large market-making firms now spend hundreds of millions of dollars a year on compute; Griffin compares compute inflation to jet fuel and egg prices, a cost that high-margin businesses can bear and low-margin businesses cannot.
    • China leads in roughly 67 or 68 of the 74 or 75 most important technologies in the world, including solar, EV batteries, and multiple quantum fields, and has pulled ahead in published academic papers.
    • The drivers are structural: 1.4 billion people, an extraordinarily strong educational culture, and far more STEM graduates, producing exactly the human talent needed to win in a high-IP world.
    • China is no longer relegated to producing low-margin products designed in America, and Griffin calls that shift a threat to the American way of life; the answer is not tariffs but educating US youth to out-compete, out-innovate, and out-problem-solve.
    • If China takes Taiwan and the US loses access to Taiwanese semiconductors, the rough estimate is US GDP falls 8 percent in six months: a great depression in the blink of an eye, unlike any before.
    • The mechanism is concrete: Boeing stops making planes within six months, most new cars stop being manufactured, consumer electronics production freezes, because TSMC chips are in every high-end product made.
    • There are no winners in a Taiwan escalation: tanking the US economy would have draconian knock-on effects for China given America’s importance as an export market.
    • In a Taiwan blockade Griffin does not expect unified global sanctions against China: where you sit determines your exposure, Europe’s place on team USA is less clear than two years ago, and the oil-exporting Middle East will play Switzerland.
    • On energy, the US must re-embrace nuclear, with small modular reactors a big part of the story: nuclear has effectively no carbon footprint and one of the lowest mortality rates of any energy source ever used (hydro has killed magnitudes more people).
    • He punctures the clean-energy veneer: solar cells are often made in western China by burning coal, with roughly a seven-year energy payback, and carbon fiber wind turbine blades last 20 years then fill landfills because they do not break down. No truly clean solution exists until fusion or broader nuclear.
    • Until then, natural gas is America’s huge asset: decades of cheap supply, and one of the few things that has actually brought down US carbon emissions.
    • Data centers are going to get built somewhere, and Griffin argues it would be inane for America to end up dependent on foreign countries for them; his fix for NIMBY politics is to require data center builders to construct corresponding power generation, tied to the grid for reliability, rather than pushing costs onto consumers.
    • His hedging doctrine for complicated risks: run stress tests, know exactly how much you lose and where in the worst case, and keep exposures sized so the loss is definable, tolerable, and leaves you still in business and able to fight back. You will never hedge every tail event.
    • Hedge fund industry economics: the long-run cost of capital is roughly the risk-free rate plus 4 percent; underperform and capital flows out, outperform and it flows in, and inflows dilute alpha because alpha capacity is finite.
    • Citadel has returned $25 to 30 billion to its limited partners to keep return on equity high: Griffin’s job is to grow annual alpha capacity, and any capital beyond what the portfolio needs goes back to LPs.
    • The alignment test for allocators: the biggest investor in Citadel’s funds is Griffin and his partners, and every LP should ask whether their GP is in the asset management business or the performance business.

    Detailed Summary

    Return to Office and the Cost of Remote Work

    Asked what he is most proud of beyond the numbers, Griffin starts with Citadel’s early, countercultural demand that everyone return to the office five days a week. He frames it as a human capital decision, not a control decision: people learn through apprenticeship, mentors are critical to development, and the underdevelopment of talent from remote work has damaged the broader economy. He points to recent Fed research on falling employment among under-30s: remote work turns out to matter more than AI in diminishing opportunities for young Americans. Citadel not only brought its team back but publicly extolled the virtues of doing so, and Griffin believes history will be on his side.

    72 Hours to FDA Approval and the Warp Speed Incentive Design

    His second point of pride is Citadel’s pandemic chapter. As the first US COVID cases appeared, a former partner running a major New York hospital system called: he could not get FDA approval for experimental drug trials on ventilated patients facing imminent death, and believed only Griffin could make it happen. Citadel’s team, with decades of government experience, got approvals moving in about 72 hours. The second act was Operation Warp Speed, whose core idea Griffin discussed at length with Jared Kushner: pay pharmaceutical companies to manufacture vaccines before FDA results, so a positive result means days to market instead of the standard sequence losing three to six months. No company would spend billions producing vaccines that might be flushed down the sewer, so the US government took the manufacturing risk on unproven efficacy. A few billion dollars spent, a few trillion in GDP saved, and roughly half a million American lives.

    All-Time Highs in a World at War

    Griffin’s market picture is unsentimental: there is a war in the Middle East, a still-raging war in Europe, potential trouble in Cuba, and the peace both men grew up with is off the table. Yet the S&P sits at record highs. His explanation: America is relatively shielded from the war-driven energy crisis. China has curtailed oil demand with an elasticity that stunned even Citadel’s commodity desk, and episodic oil and LNG flows keep leaving the region, holding crude around the low $100s when most estimates had a strait closure producing nearly $200 a barrel. Meanwhile corporate earnings are at all-time highs, enough that multiples have actually compressed over the last 12 months.

    The AI Story CEOs Tell Versus the One That Is True

    Citadel has used machine learning heavily since TensorFlow arrived a decade ago, powering everything from radiology reads to self-driving cars across the economy, so Griffin sees today’s AI wave as an acceleration of an ongoing digital revolution. His favorite corrective: at a dinner with global multinational leaders two years ago, everyone was effusive about AI transforming their businesses, so he asked them to go around the table with specifics. Four or five genuinely impressive productivity stories emerged, and not one involved AI: they were machine learning, optimization, digitization, technology at large. The C-suite blurs the distinction, but the enthusiasm has unlocked bigger technology budgets and real bottom-line projects, which is part of why earnings are at records.

    The Agentic System That Shocked Him

    Then comes the story behind the famous “shocked and depressed” Friday. Citadel employs legions of young masters and PhD graduates to replicate academic finance papers: read the hypothesis, judge the work, reproduce results, and test whether the effect persists out of sample (does buyback activity predict outperformance, for example). Each paper takes six to eight weeks, and the process surfaces a few valuable ideas a year. A colleague built an agentic AI system that does the entire pipeline (read, reproduce, verify, out-of-sample test) in two to three hours on average. Griffin’s emphasis: this is not routine white-collar work, it is master’s and PhD-level work, and paired with OpenAI solving a math problem open for 80 years, it shows AI cracking problems considered out of reach two or three years ago. Notably, Citadel cut zero headcount on the back of the breakthrough; the firm has more problems worth attacking than people to attack them, so every productivity gain gets absorbed.

    Filled-In Moats and a Golden Age of Entrepreneurs

    The macro consequence Griffin draws is double-edged. Hold two thoughts at once: AI is reaching very high-level work in the job market, with some workers (translators, for instance) facing hard transitions that demand fast retraining through higher education. And simultaneously, the competitive moats of corporate America are being filled in at breathtaking rates. That means entrepreneurs can launch businesses at speeds impossible 5, 10, or 20 years ago: he mentions a startup running on a few AI systems where 30 or 40 employees would once have been required. He expects a wave of these stories over the next couple of years as founders use the technology to take on incumbents.

    The Future of the Stock Picker

    Griffin has called stock picking a timeless business, and he still sees a similar skill set for the portfolio manager of the future, with one shift in emphasis. Predicting quarterly earnings beats has gotten far harder over a decade as alternative data (credit card panels covering millions of Americans, telegraphing Starbucks and McDonald’s revenues) made the present transparent. Now bright people plus good AI triage the here-and-now almost instantly. The scarce, rewarded skill becomes vision: identifying which companies are building genuinely transformative products years before the market fully prices it.

    Compute Is the New Jet Fuel

    At Citadel Securities, which holds double-digit market share across equities, futures, and treasuries, transformer models extend a decade of machine learning gains in pricing and risk. The compute market backdrop is what Griffin calls breathtaking: essentially all available compute on Earth is utilized all the time, so access reduces to who will pay the most. Per-unit compute prices exceed what anyone reasonably projected two or three years ago, and large market makers now spend hundreds of millions of dollars annually. He treats it as straightforward input inflation, like jet fuel or eggs: high-margin businesses can bear it, low-margin ones cannot.

    China’s Technology Lead and the Taiwan Equilibrium

    Griffin states the cold reality: China is one of the most innovative, fastest-growing economies in the world, leading in roughly 67 or 68 of the 74 or 75 most important technologies (solar, EV batteries, several quantum fields) and now ahead in published academic papers. The foundation is 1.4 billion people, a culture with an extraordinary emphasis on education, and far more STEM graduates. China is no longer relegated to manufacturing low-margin products designed in America, and Griffin calls that a threat to the American way of life. His prescription is pointed: not tariffs, but educating American youth to out-compete, out-innovate, and out-problem-solve. Taiwan is the painful pressure point with no winner. If China takes Taiwan and the US loses TSMC chips, GDP falls an estimated 8 percent in six months: Boeing stops making planes, most new car production halts, consumer electronics freeze, a great depression in the blink of an eye. China would suffer draconian knock-on effects too. As an investor he thinks about position: sanctions in a Taiwan blockade would not be unified, Europe’s place on team USA is a genuine question mark now, and the oil-exporting Middle East would play Switzerland since China is its biggest customer.

    Energy Realism: Nuclear, Gas, and American Data Centers

    On powering AI, Griffin wants America to lead again in nuclear, with small modular reactors central: no meaningful carbon footprint and one of the lowest mortality rates of any energy source ever deployed (hydro has killed magnitudes more people). He challenges the superficial cleanliness of renewables: solar cells are often made in western China with coal power, requiring about seven years of energy capture to break even against the coal burned making them, and 20-year-old carbon fiber wind turbine blades do not break down and are already filling landfills. Until fusion or expanded nuclear, America’s real asset is natural gas: decades of cheap supply that has actually driven US emissions down. His data center position is blunt: they will get built somewhere, and depending on foreign countries for them would be inane, so build them in America. His answer to NIMBY politics: require data center developers to build corresponding power generation, tied to the grid for reliability, so the cost never lands on the American consumer.

    Tail Risk, Tolerable Losses, and Hedge Fund Alignment

    On hedging complicated risks, Griffin’s method is stress testing: if this happens, how much do we lose and where, and is that loss tolerable? You can never manage a portfolio for every possible tail event, but you can keep exposures sized so the worst case is definable and tolerable, leaving you still in business and positioned to fight back. On industry returns, he pegs the hedge fund cost of capital at roughly the risk-free rate plus 4 percent as the long-run equilibrium: underperformance drains capital, outperformance attracts it, and since recent outperformance keeps pulling money in, growing assets dilute alpha. That is why Citadel has returned $25 to 30 billion to LPs: alpha capacity is finite, Griffin’s job is to grow it, and excess capital goes back to investors to keep return on equity high. The closing advice is an alignment test: Citadel’s biggest investor is Griffin and his partners, and every allocator should ask whether their GP is in the asset management business or the performance business.

    Notable Quotes

    “Turns out that remote working is a more important factor to diminished employment opportunities for young Americans than AI.”

    Ken Griffin, citing Fed research on under-30 employment

    “We spent a few billion dollars as a country. We saved a few trillion dollars in GDP. We saved roughly half a million American lives.”

    Ken Griffin, on Operation Warp Speed’s incentive design

    “I got four or five incredible stories of how companies were achieving meaningful productivity gains. Not one involved AI.”

    Ken Griffin, on his dinner with global multinational CEOs

    “My colleague built an agentic AI system that would read a paper, reproduce it, verify the results that were published in the paper, produce the results out of sample, and do all this work in about on average 2 to three hours.”

    Ken Griffin, on the breakthrough that replaced six to eight weeks of PhD-level work

    “We’re likely to see a golden age of entrepreneur activity. Like entrepreneurs will be able to launch new businesses at breathtaking speeds and will be able to take on incumbents in ways that you just couldn’t do 5, 10, 15, 20 years ago.”

    Ken Griffin, on AI filling in competitive moats

    “All the available compute today is more or less utilized all the time. So the question is who’s willing to pay the most for it?”

    Ken Griffin, on the global compute market

    “The US loses access to Taiwanese semiconductor chips, our GDP falls by 8% in 6 months. Simply put, we go into a great depression in the blink of an eye unlike any we’ve seen before.”

    Ken Griffin, on the Taiwan scenario

    “We better damn well build the data centers in America because they’re going to get built somewhere in the world.”

    Ken Griffin, on energy policy and AI infrastructure

    “Definable, tolerable, still in business, still in a position to fight back from that point.”

    Ken Griffin, summarizing his approach to hedging tail risk

    “Are they in the asset management business or are they in the performance business?”

    Ken Griffin, on the question every hedge fund investor should ask their GP

    Watch the full conversation here: Ken Griffin on Goldman Sachs Exchanges: Great Investors.

    Related Reading

  • Bill Ackman on Investment Strategy, What the Market Is Missing, and How AI Breaks Businesses

    Bill Ackman, founder and CEO of Pershing Square, joined the All-In Podcast for a conversation about how his investment approach has shifted toward permanent, long-term ownership, why he believes the highest-quality companies are being left behind by a market chasing the new new thing, and how AI is raising the risk of disruption for almost every business. He also lays out his plan to turn Howard Hughes into a Berkshire Hathaway-style compounding machine built on insurance. You can watch the full conversation here. Below is a structured breakdown of the ideas, the stories, and the frameworks he uses to underwrite a business.

    TLDW

    Ackman explains how his philosophy evolved from a smaller, more liquid activist toward concentrated, permanent ownership of durable, non-disruptible businesses, with much of his activism now playing out on X rather than in the boardroom. He tells the origin story of his first big trade, Wendy’s and the Tim Hortons spin-off, and explains why a large long-term shareholder on a board is an antidote to short-term markets. On AI, he argues that this is the greatest era in history to build a company, which means the risk of being disrupted has gone up enormously, and that the market is mispricing high-quality compounders like Microsoft, Meta, and Amazon while crowding into chips, semiconductors, and energy. He works through the SaaS question and why niche software is more at risk than platforms, how he underwrites SpaceX, xAI, OpenAI, Anthropic, and Palantir like late-stage venture bets using a people, opportunity, context, deal framework, and why founder-led companies have an edge in making radical calls. The back half covers his Howard Hughes plan to copy Buffett’s insurance-float model, the role of cost of capital and reflexivity in markets, the meme-stock era, going direct on social media, and the three different ways an investor can put money to work with Pershing Square.

    Thoughts

    The most useful idea in the interview is the way Ackman reframes disruption as the central investing problem of the AI era. His point is that the same forces making this the best time in history to start a company, meaning near-unlimited compute, capital, and talent, also raise the odds that any given incumbent gets disrupted. That reframes the word quality. It is no longer mostly about margins and moats. It becomes about non-disruptibility, which is a much higher bar than most quality investors were using a decade ago, and it is why he says most of his research time now goes into assessing that single risk.

    The what-the-market-is-missing thesis is classic contrarian Ackman. Arguing that Microsoft, Meta, and Amazon are the new old-fashioned, undervalued names while capital piles into semiconductors and energy is a direct echo of 2000, when Berkshire Hathaway bottomed precisely because money was chasing internet stocks. It is worth keeping in mind that he owns all three, so the call is also his book. The durable signal here is the framework, not the specific tickers: capital reliably chases the new new thing, and genuinely high-quality businesses get left behind during those rotations.

    The Howard Hughes plan is the most concrete bet in the conversation. Copying Buffett’s insurance-float playbook, short-term treasuries for policyholder money and equities for the surplus, onto a discounted real-estate holding company is elegant. The hard part is exactly what Ackman flags about insurance as an industry: the best investors go to hedge funds, not insurers, so most insurance companies only ever manage the liability side well. Pershing Square’s edge is that Ackman can both write the business and invest the float, which is the same reason it worked for Buffett. The framing of going from a four billion dollar company to a trillion over fifty years is a statement of intent, not a forecast, and should be read that way.

    Underneath all of it sits cost of capital and reflexivity. His observation that a higher stock price literally makes a company more valuable, because it lowers the cost of capital and creates acquisition currency, is the mechanism behind both Elon Musk’s empire and the meme-stock era he is wary of. Going direct on X is the same lever pointed at himself: communicate the vision, lower your own cost of capital, and make the bet easier for other people to place. It is a coherent worldview in which narrative and balance sheet continuously feed each other, and it explains a lot of his behavior over the last few years.

    Key Takeaways

    • The biggest change in Ackman’s approach over time is an appreciation for business quality, meaning long-term, durable, protected, non-disruptible growth as the most important factor.
    • He says he is as activist as ever, but more of it now happens on X than in the traditional corporate context.
    • His first big investment was Wendy’s, which owned Tim Hortons. The simple thesis was to buy Wendy’s, spin off Tim Hortons, and double the money.
    • Early on no one returned his calls, so he had Steve Schwarzman’s Blackstone write a fairness opinion, filed it publicly, and the company spun off Tim Hortons six weeks later. The CEO later thanked him after being fired with a large exit package.
    • Reputation compounds. Where Pershing Square once had to bang down the door, companies now sometimes tweet a welcome when it buys a stake.
    • A large long-term shareholder on a board is a counterweight to short-term markets, letting management test ideas privately and pursue initiatives that hurt the next few quarters of earnings.
    • Pershing Square owns Microsoft, Meta, and Amazon. Ackman argues you are either invested in AI directly or indirectly, or it is a threat, so you have to understand it.
    • The hardest and most important job for a concentrated investor is judging the risk of disruption, and that risk has risen dramatically.
    • This is the greatest era in history to build a business because of near-unlimited access to compute, capital, and talent, which is exactly why the probability of being disrupted has gone up enormously.
    • Markets bring their eye to the new new thing, currently chips, semiconductors, and energy, while high-quality companies get left behind.
    • He draws an analogy to 2000, when Berkshire Hathaway traded at one of its lowest valuations because everyone chased internet stocks. He sees a similar dynamic around Amazon, Meta, and Microsoft today.
    • On the SaaS question, he worries more about a Salesforce than a platform like Microsoft, because niche software charging high per-seat or per-year prices is most exposed, while low-priced platforms are safer.
    • Any software company today has to be as AI-enabled as possible, or risk losing the monopolistic pricing it once enjoyed.
    • His famous March 2020 CNBC appearance was an attempt to reach President Trump and argue for a short shutdown, paired with the view that stocks were incredibly cheap and worth buying.
    • He describes valuation as a tether on the market: when prices stretch too high they snap back, and when they get too cheap the same rubber band pulls valuations up. Calling that out publicly can trigger a psychological reset.
    • His recent bullish call came because stocks of really high-quality companies had gotten crazy cheap on fundamentals, meaning the present value of the cash they generate.
    • He underwrites high-multiple names like SpaceX as venture investments using a framework from business school: people, opportunity, context, deal.
    • On SpaceX, people and opportunity are one of one, the context is incredible, and Starlink plus near-monopoly low-cost launch make it strategically valuable. The complicated part is the deal, meaning the valuation. He invested via an SPV after Ron Baron’s nudge, and also invested in xAI.
    • He treats OpenAI, Anthropic, and Palantir as late-stage venture bets that have proven they can generate real revenue, and says OpenAI should do a better job communicating how it thinks about its enormous capital commitments.
    • Every CEO in America is asking how to use AI, how it applies to their business, and how it is a threat. It is top of mind and boards open every meeting with it.
    • He has not seen much enterprise AI success yet, citing a McKinsey study that 95 percent of enterprise initiatives fail and the rise of the forward deployed engineer as the hot role bridging promise and ROI. Pershing Square itself uses AI mainly for legal, compliance, and back-office work.
    • Founder-led companies have an advantage because founders have the authority and the economic stake to make radical calls, while the average S&P 500 CEO has a roughly three to four year tenure and is incentivized not to make mistakes.
    • He cites Mark Zuckerberg buying Instagram and WhatsApp as the kind of shocking-at-the-time calls that a founder with a track record can make.
    • Ben Graham’s enduring lesson is that a stock is an interest in a business, not a piece of paper, but Graham mostly invested in liquidations and cash-rich shells, and made most of his money on Geico.
    • Most of Buffett’s value at Berkshire came from owning insurance operations and focusing on the asset side of the balance sheet, not just the liability side.
    • Insurance is hard to copy because top investors do not go to work for insurers. Buffett owned half his company and was a great investor, which is why it worked.
    • Howard Hughes came out of the General Growth bankruptcy and owns master-planned cities like Summerlin, with 26,000 acres in the Las Vegas area, comparable to the Irvine Company that built roughly a hundred billion dollars of wealth for Donald Bren.
    • The plan is to reinvest the cash Howard Hughes generates into insurance, put policyholder float in short-term treasuries and the surplus in common stocks, and build a compounding machine over fifty years, buying it at roughly sixty cents on the dollar.
    • A company must earn a return above its cost of capital for the stock to rise. Elon Musk has kept his companies’ cost of capital extremely low, and a SpaceX IPO near a 1.75 trillion dollar valuation could be one of the lowest cost of equity capital transactions ever.
    • Markets have changed less because of Ackman and more because of figures like Ryan Cohen and GameStop, where a stock can trade well above its value on personality and an army of followers.
    • Higher valuations are reflexive: a rising stock price lowers cost of capital and creates currency to issue stock and acquire businesses, which is part of how Elon built Tesla.
    • There are three ways to invest with Pershing Square: the management company itself (a royalty on compounding assets with no capex), PSUS (a portfolio of best ideas trading at an 18 percent discount), and Howard Hughes (a bet on building the next Berkshire). A dollar invested 22 years ago became roughly 27 to 28 times net of fees.
    • Going direct on X, with 2.2 million followers, lets him communicate his vision and lower the friction for others to back his bets, even as his very long tweets have become a running meme.

    Detailed Summary

    From activist trades to permanent capital

    Ackman frames the evolution of his career as a steady move toward business quality. As a smaller, more liquid investor early on, he did not have to think as long-term. As Pershing Square became a bigger, more concentrated investor, durable growth became the dominant factor in every decision. He insists he is still as activist as ever, but a lot of that energy has shifted to X, where he can argue a position publicly rather than only inside a boardroom. The best investments, he notes, are the ones where you do not need to join the board and do anything at all.

    The Wendy’s and Tim Hortons origin story

    One of Pershing Square’s first investments was Wendy’s, which owned the Canadian coffee and donut chain Tim Hortons. The value of Tim Hortons alone was greater than the entire value of Wendy’s, so the idea was simple: buy Wendy’s, spin off Tim Hortons, and double the money. Ackman bought ten percent of the company and could not get the CEO to return a single call, so he had a contact at Blackstone, with Steve Schwarzman’s sign-off, write a fairness opinion on what Wendy’s would be worth after a spin-off, filed it publicly, and watched the spin-off happen six weeks later. The CEO eventually called back to thank him, having been fired but rewarded with a large exit package. Over the years that scrappy approach gave way to a reputation that now opens doors on its own.

    Why a long-term shareholder on the board matters

    The core problem of being a public company, in Ackman’s telling, is the short-term nature of markets and analysts, when a good business should be run in the context of years and even decades. A large, supportive shareholder on the board gives management a place to test ideas before exposing them to the public and a credible voice willing to back initiatives that hurt earnings for a few quarters. That is the value-add he believes a constructive activist can bring to a mature public company, as opposed to a startup where the best outcome is simply to own a great business and stay out of the way.

    AI and the rising risk of disruption

    For a concentrated, long-term investor, the most challenging task is judging the risk that two people from Stanford in a garage build something that destroys your thesis. Ackman argues that risk has climbed dramatically because this is the greatest era in history to build a company, with near-unlimited access to compute, capital, and talent. The paradox is that the conditions that make building easier also make incumbents more fragile, so the bulk of his research now centers on assessing how disruptible a business really is.

    What the market is missing

    Investors bring their attention to the new new thing, currently chips, semiconductors, and energy, which leaves high-quality companies behind. Ackman compares the moment to 2000, when Berkshire Hathaway traded at one of its lowest valuations ever because capital was chasing internet stocks. He sees an echo today in how Amazon, Meta, and Microsoft are treated as old-fashioned, and he considers them undervalued on fundamentals, where value is the present value of the cash a business generates over its life. His recent bullish call, like his March 2020 appearance, came because stocks of really high-quality companies had simply gotten too cheap.

    The SaaS question and AI-enabled software

    On the so-called SaaS apocalypse, Ackman says it is a company-by-company analysis. He worries more about something like Salesforce than about a low-priced platform. The companies most at risk are those that extracted near-monopolistic profits by charging a high annual price for a niche product, because AI lowers the barrier to replicating that functionality. A platform where the average customer pays a small amount per seat, like Microsoft, is far less exposed. The takeaway for any software company is to become as AI-enabled as it possibly can.

    Underwriting SpaceX, xAI, and the AI labs like venture

    For the highest-multiple private companies, Ackman uses a venture lens and a framework a business school professor taught him: people, opportunity, context, deal. SpaceX scores as one of one on people and opportunity, with an incredible context and a near-monopoly in low-cost launch through Starlink, which makes even Amazon a likely customer. The complicated variable is the deal, meaning the valuation, and he admits he has not done all the math, having invested through an SPV after Ron Baron encouraged him, along with a position in xAI. He treats OpenAI, Anthropic, and Palantir as late-stage venture bets that have proven real revenue, and argues OpenAI in particular should communicate more clearly how it justifies capital commitments that vastly exceed current revenue.

    Founder-led companies and the authority to act

    Ackman agrees that founder-led companies have a structural advantage in a fast-changing environment. The average S&P 500 CEO has a tenure of roughly three to four years, a small economic stake, and an incentive not to make a career-ending mistake. A founder is betting an entire life and reputation, has the authority of a major voting and economic position, and has usually made several hard, contrarian calls that turned out right. He points to Mark Zuckerberg’s acquisitions of Instagram and WhatsApp, which looked shocking at the time, as exactly the kind of decision a founder with a track record can make and a hired manager often cannot.

    Howard Hughes as Berkshire Hathaway 2.0

    Ackman points to a detailed financial history of Berkshire Hathaway showing that the vast majority of Buffett’s value creation came from owning insurance and focusing on the asset side of the balance sheet, not just the liability side. Insurance is hard to replicate because skilled investors join hedge funds rather than insurers, but Buffett owned half his company and was a great investor. Pershing Square is applying the same idea to Howard Hughes, a company created out of the General Growth bankruptcy that owns master-planned cities such as Summerlin, with 26,000 acres around Las Vegas, in the spirit of the Irvine Company that made Donald Bren roughly a hundred billion dollars. The plan is to reinvest the company’s cash into insurance, place policyholder float in short-term treasuries and the surplus in common stocks, avoid issuing stock the way Buffett did, and compound for fifty years, all bought at around sixty cents on the dollar.

    Cost of capital, reflexivity, and going direct

    A company only creates value when it earns above its cost of capital, which is why Howard Hughes, seen as a high-cost-of-capital real-estate business, has long traded at a discount, and why Ackman is repurposing its assets into a higher-returning model. He highlights how reflexive markets are: a higher stock price itself makes a company more valuable by lowering its cost of capital and creating currency to raise money and acquire businesses, a lever Elon Musk used to build Tesla. He attributes real market change less to himself and more to figures like Ryan Cohen and GameStop, where personality and a following can lift a stock far above its value. His own going-direct strategy on X, with 2.2 million followers and famously long posts, is the same mechanism applied to communicating a vision and lowering friction for investors. He closes by laying out three ways to invest with Pershing Square: the management company as a royalty on compounding assets, the PSUS portfolio trading at an 18 percent discount, and Howard Hughes as a bet on building the next Berkshire.

    Notable Quotes

    “The best investments are one where you don’t need to join the board and do anything.”

    Bill Ackman, on the kind of business he most wants to own

    “The probability of your being disrupted has gone up enormously.”

    Bill Ackman, on why assessing disruption risk now dominates his research

    “Valuation is like a tether on the market, right? When it gets too high, it’s like this rubber band that’s stretching and inevitably it bounces back.”

    Bill Ackman, on how prices revert at both extremes

    “People, opportunity, context, deal.”

    Bill Ackman, on the business school framework he uses to underwrite companies like SpaceX

    “Every CEO in America today is like, how do I use AI?”

    Bill Ackman, on AI as the top opportunity and threat in every boardroom

    “A closed mouth gathers no foot.”

    Bill Ackman, quoting the line a friend put next to his name in his high school yearbook

    “The increase in value of the company increases the value of the company, right? Because it lowers the cost of capital, it gives you more flexibility, gives you the ability to issue stock, raise capital, acquire other businesses.”

    Bill Ackman, on the reflexivity between stock price and corporate value

    “The company’s got like a $4 billion market cap and the goal is to build it into a trillion dollar thing over time compounding.”

    Bill Ackman, on his fifty-year plan for Howard Hughes

    Taken together, the conversation is a tour of how Ackman now thinks about quality, disruption, and compounding, and a preview of the Berkshire-style machine he wants to build out of Howard Hughes. Watch the full conversation here.

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