My guest this week is Ash Fontana, a managing partner at venture capital firm Zetta, who invests in companies which build software that uses artificial intelligence methods like machine learning to predict and prescribe outcomes. Ash’s combined experience as a founder, entrepreneur, and investor give him the perfect background to discuss with us one of the hottest topics in business and investing.This conversation is useful for anyone trying to evolve their own way of dealing with data. Of particular interest are the ways that Ash and his team evaluate data sets and how they think about competitive advantage in this new world—where he advocates a new term to replace the concept of moat: loops. If we can use data to do things better than humans, or if we can supercharge our intuitions with predictive models, we can harness the power of this new technology. What Ash has taught me is that data itself is dumb. But great data sets can represent the fuel for incredible companies. Let’s dive into how that may be. Please enjoy this conversation on how AI is changing business, and how we might profit from that change.For more episodes go to InvestorFieldGuide.com/podcast.Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.Follow Patrick on Twitter at @patrick_oshagBooks ReferencedThe Most Important Thing: Uncommon Sense for The Thoughtful InvestorLinks ReferencedJerry Neumann Podcast EpisodeAli Hamed Podcast EpisodeShow Notes2:25 - (First Question) – A look at their very specific investment strategy3:35 – Future of competitive advantage in the SaaS industry6:45 – How startups and new companies can compete against software giants that are pretty well entrenched in the market8:38 – How do copies with narrow focuses attract VC money which is looking for massive returns12:28 – The stages in which AI will be enabled15:55 – Framework of an AI company18:49 – Importance of the feedback in the AI company framework20:56 – Examples of AI companies23:50 – Why companies that are AI from the start will have a significant advantage in the space26:21 – How do companies change their thinking about compiling useful data32:18 – Regulation of AI35:03 – Preventing other companies from leap frogging you in the AI space37:57 – Some of his favorite AI companies40:43 – How much has he seen in the finance world41:07 – Jerry Neumann Podcast Episode43:10 – Why the focus on B2B AI companies45:34 – Major components of the enterprise stack that he focuses on for AI49:30 – What impact will all of this AI have the daily lives of people51:38 – Biggest problems that he is excited to see AI tacklet53:04 – How do you value the intangible asset of an AI model57:13 – How Ash thinks about getting other investors into firms they seeded1::00:27 – Other investors that Ash really respects1:01:15 – The Most Important Thing: Uncommon Sense for The Thoughtful Investor1:03:29 – Ali Hamed Podcast Episode1:04:04 – Where would Ash invest outside of AI1:07:11 – More about his family nut business1:11:18 – Favorite macadamia nut story1:12:05 – Kindest thing anyone has done for AshLearn MoreFor more episodes go to InvestorFieldGuide.com/podcast. Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclubFollow Patrick on twitter at @patrick_oshag