Steel ships, railroads, and data centers: A VC takes the Industrial Revolution analogy seriously

In 2026, Hans Tung and I are talking about 19th-century ships.

“The Dutch, the Spanish, the Portuguese—they sailed around the world with beautiful large ships, but they were wooden wind ships,” said Tung, Notable Capital managing partner and early backer of companies like Airbnb , Coinbase, and Anthropic.

“The British were the first to scale ships with the steam engine.

Adopting steel technology and applying it to the steam engine—that made the British Navy stronger than the rest of the world combined.

Without that buildout—steel ships, the steam engine—we wouldn’t even have the American concept of free trade.” Tung loves history (as do I, which anyone subjected to whaling ventures-centric writing knows) , and I came to him with something that had been irking me: I’ve often heard VCs talk about AI as an “Industrial Revolution-level change,” in a way I’ve frequently found hand-wavey.

My question to Tung: What if we took the historical analogue seriously? What does it mean to take that parallel to its full conclusion? And so Tung started with ships, suggesting a throughline from Portuguese spice routes to Britain’s steel ship global dominance (in 1890, 80% of the world’s ships came from British shipyards).

To Tung, this is his first mental model for the technological leap we’re living through as our global infrastructure morphs to meet the age of AI.

His case: There’s perhaps too much focus on any one app or company, and that major technological change only creates geopolitical dominance if the infrastructure is there to back it up.

“Wood ships don’t last as well in the long run,” said Tung.

“The need for steel ships with steam engines was important to be able to go around the world.

The British end up doing this because they invest in technology that allows them to leverage the benefits of the Industrial Revolution.

They end up dominating the world for more than 100 years.” I also asked Tung a question I’ve been asking all sorts of people lately, my own strange version of a Rorschach test perhaps: Are data centers the railroads of the 21st century? His personal answer is, essentially, yes.

“If you don’t have enough compute to meet demand, it doesn’t matter if you have a better model,” Tung told Fortune .

“The models that win are the ones that are available.” Consider, for example, the Civil War, won partially because the railroad infrastructure of the North was far more developed than the South’s.