Why a Chemist Left $7B to Bet on Physical AI Before Everyone Else | Bilal Zuberi, Red Glass Ventures
Why a Chemist Left $7B to Bet on Physical AI Before Everyone Else | Bilal Zuberi, Red Glass Ventures  
Podcast: The Peel with Turner Novak
Published On: Thu Oct 08 2026
Description: Bilal Zuberi spent 18 years investing hard tech, most of it as a GP at Lux ($7B AUM), before starting @RedGlassVC in 2025 to bet on AI that touches the physical world.Bilal was making defense tech investments 15 years ago, and he led the Series A in Applied Intuition, now a $15 billion company.We hung out for a few hours and he shared everything he's learned investing in hardware, why hardware is still hard, why the deployment layer is the most attractive area of physical AI, taking a 90% pay cut to start Red Glass, "AUM as a moat", how to become a billionaire off management fees, and why consensus investing is mostly a circle jerk.Thanks to this episode's sponsors:Monaco: The revenue engine for startups https://monaco.comFlex: Premium banking, 60-day credit, 0% APR https://home.flex.one/referral/bananacapitalClerk: Everything you need for authentication https://clerk.comNumeral: Sales tax on autopilot https://numeral.comTimestamps:(0:00) Leaving $7B to bet on physical AI(0:51) What most people get wrong in physical AI(4:17) Why a startup has to become a business(11:31) Hardware is still hard, so what changed?(15:40) How government went from SBIR mills to real customer(17:48) Robotics goes from hard-coded to probabilistic(23:34) Where value accrues: full stack, then wedges(25:24) How Applied Intuition became a $15B company(28:03) The deployment layer is the real prize(32:22) OpenAI and Anthropic hint what will happen in physical AI(36:14) Why customers have all the downside(37:56) The best founders paint a picture and execute(40:53) Why it's called Red Glass (founders chew glass)(42:17) Every founder hates fundraising, even Travis(44:29) Red Glass's four core values(50:49) Why founders really take your call (the $250k effect)(53:28) What Bilal looks for in a founder(58:44) Why technical founders underrate fundraising(1:00:26) The Tiger Global era(1:04:02) From $10B to $100B, the goalposts moved(1:06:21) Is this a bubble? Portfolio construction(1:08:55) Building a firm that outlasts him(1:12:13) From Nobel-lab chemist to Zero-to-One investor(1:13:45) Are small funds just outsourced associates?(1:16:35) When AUM becomes the moat(1:18:34) How big funds choke off SPV money(1:21:24) The risk of VCs backing competitors(1:23:31) Why fund economics push everyone bigger(1:26:20) Consensus investing is a circle jerk(1:29:51) You can be a billionaire on fees alone(1:33:09) Equal carry and the right to win(1:35:55) Why good ethics in VC matterCheck out Red Glass VC: https://www.redglass.vc/Follow BilalTwitter: https://x.com/bznotesLinkedIn: https://www.linkedin.com/in/bzuberiFollow TurnerTwitter: https://twitter.com/TurnerNovakLinkedIn: https://www.linkedin.com/in/turnernovakSubscribe to my newsletter to get every episode + the transcript in your inbox every week: https://www.thespl.it/