In this interview with In Good Company, Stan Druckenmiller describes how his investment in AI began with observations from younger analysts who noticed a shift among top engineering graduates from crypto to AI.

Initially unfamiliar with Nvidia’s AI potential, he bought shares when the stock was down and AI was gaining attention. ChatGPT’s release confirmed his interest, prompting him to explore AI’s broader impact on sectors like power and uranium.

Though he’s bullish on AI’s future, Druckenmiller remains cautious about timing and specific plays, comparing the uncertainty to the early internet era where market leaders weren’t immediately clear. He’s open to adjusting his approach as AI evolves.

Here’s an excerpt from the interview:

Druckenmiller: Honestly uh I’ve got young really good analysts here who are on top of things and they started um we noticed about three or four years ago that the kids that go to Stanford and MIT, the engineers were shifting from crypto to AI.

That was the first sign. Then my young Partners started talking more and more about AI uh I asked them how to play it? They mentioned a company called Nvidia which I thought was a gaming company I hadn’t done work on in a long time.

I bought a pretty good chunk of it and then like a month later ChatGPT happened it was just total luck.

I had no idea ChatGPT but the AI drum around here was big enough and the stock was down I think from 400 to 150 or something so that’s how I got started in it.

Once we invest in something like that then we really start to dig deeper and then there was a whole chain of things.

We knew it would affect power, we knew it would affect uranium, we just went through the whole chain and it was a pretty easy trend to spot.

Not unlike um the cloud was the you know these things come in waves but AI the question with AI now that I’m wrestling with and the reason our exposure is really neither long nor short is how to play it.

Because we started with picks and shovels which is Nvidia and to some extent um Microsoft but now we’re seeing just massive amounts of capital being spent by these modelers.

And if AI is for real and I think it is they’re all going to give you the same answer so we’re going to have four or five companies will spent masses amounts of capital but I don’t see it as a winner r take all model.

On the other hand I think there are applications um that I haven’t even thought of and nobody’s thought of they’re going to spring up.

I mean who would have thought of Uber or Facebook when the internet started so we’re very bullish on AI but we’re not bullish currently on exactly where we’re supposed to be and how to play it aggressively.

Not unlike the internet in 2000/2001 you could have believed in the internet not been exposed and then got your exposure on a more timely basis or I could just be wrong which is wouldn’t be that unusual.

You can watch the entire interview here: