Brady Enright is a Capital Group equity portfolio manager and chair of the Equity Management Committee. He has an MBA from Harvard Business School and a bachelor’s in biology from Stanford University. We asked Brady about his investment edge and how his experience investing through the dot-com era informs his thinking around artificial intelligence (AI).

If you’d like to hear more from this conversation, we invite you to watch or listen to Brady’s appearance on the Capital Conversations podcast on Apple Podcasts, Spotify or YouTube. The excerpt below has been edited slightly for clarity and brevity.

Let’s go back to 1999, just before the dot-com bubble burst. People are drawing comparisons to that period with the AI situation today, and they’re worried about tech as a component of the broad index. How do you think of that time versus now? What’s the same? What’s different?

That 1999 experience was one of the craziest of my career. I haven’t seen a speculative frenzy like that since.

There was a mixture of real companies and a lot of fluff, and sorting through that was very challenging. As to what was similar, we were in a period of transformational change. The technology itself was incredibly powerful, and it wasn’t just impacting the technology sector. It was impacting every industry.

I think one of the lessons from history is that, on the one hand, we’ll probably have dozens of new multitrillion-dollar market caps over a five- or 10-year period. But there will likely be some huge companies that basically fail because they can’t keep up with the pace of change.

During the dot-com era, I think a lot of people could visualize the potential, but we didn’t have the physical infrastructure for it to actually come to life. We knew there was going to be streaming video but we were still on dial-up modems.

This time, though, I think it’s quite different. There are still some bottlenecks — we need to build power, we need to install the compute capability — but it’s not really impeding the progress. To the extent that people look back at 1999 and say, “You can wait till Amazon falls 80%, or you can wait a while till you have this big washout and then come back to these companies,” I’m not sure it’s going to play out that way this time. I think there will be some winners who declare themselves, and they never look back. And there will be some companies that miss this transition, and they never catch up.

That’s a great way to put it. Let’s talk about opportunities today. When you look forward to the next five or 10 years, what are you seeing?

Again, we’re in this period of accelerating change, so I think you have to be even more humble than usual. I’m trying to be willing to change my mind. I think AI is the major theme, broadly speaking, but we are in a transition. Over the last three-plus years, it’s been all about building out that physical infrastructure. There were a lot of bottlenecks, and many suppliers have done extremely well because they were solving for some of those bottlenecks. If you look at those stocks today, they tend to have very high market caps or very high valuations or, in some cases, both. I feel like the opportunity is more well understood today, and so the opportunities are perhaps a bit less exciting.

If you look at companies within any given industry, some of them will implement AI really fast and really effectively, and others will lag. And the competitive gaps between companies will be really wide relative to what we’ve seen over the last decade. The divergences will be extreme. That’s really where I’m starting to bring my focus.

Let’s switch to your specific investment edge. Every one of Capital’s investment professionals, portfolio managers, analysts, has their own unique edge. What would you say it is for you?

I’m always a little careful with this question, because I don’t think there’s a lot in this business that’s proprietary. There’s no single thing that only I can do. I think the magic really, is: do you have a process? And, then, do you have the discipline to execute on it over time, over and over again?

For me, if I think about what has built my process, it’s my experience as a small-cap investor. I started out in the industry as a generalist. Each week, I would try to meet roughly a half a dozen new companies. Over a decade-plus, it was thousands of new companies. As a result of that, I think I have a lot of flexibility in terms of how I look at companies and how I think about them.

If you went back 10 or 15 years and looked at my portfolio, two of my largest holdings would have been Goldman Sachs and Amazon — two very different companies. I think my edge is bringing those different things together in a portfolio and combining them in a way where it can navigate the market over time pretty effectively.