Beyond Hormuz: How a World on Edge Is Reshaping Every Corner of Tech
Animation by Grok
April 2026
Easter is a good time to think. Not about the world as we would like it to be, but as it actually is. We did that through the lens of our four core sectors - Aerospace & Defence Tech, Travel Tech, Software & AI and Fintech - asking which are likely to compound, which need recalibrating, and which assumptions belong to another era entirely. The conclusions are worth reading. Some of them are uncomfortable.
We Have Crossed a Threshold
The post-Cold War dividend was funded by a relatively stable global trade architecture, the broad free flow of capital, labour and silicon chips, and a benign geopolitical climate that permitted Silicon Valley to operate as though geography barely mattered. That era is over.
What makes the current moment different is not simply tension, but the simultaneous convergence of several major disruptions at once: war in the Middle East, Europe re-arming amid a prolonged conflict in Ukraine, a more assertive China pursuing technological self-sufficiency and strategic influence closer to home, an America retreating from multilateralism, and the fastest technology transition in modern history - all unfolding simultaneously.
The combination matters more than any one element on its own. A Taiwan contingency that would sever Western access to leading-edge fabs, prolonged instability in the Gulf, a more fragmented financial system, a bifurcated AI stack, sovereign compute races, energy scarcity and inflation, trade restrictions and immigration constraints: these are no longer fringe scenarios. They are live boardroom conversations, war-gamed in capitals and investment committees alike, and increasingly reflected in capital allocation decisions around the world.
Ukraine, Russia and Rearmament
Any honest geopolitical analysis starts in Europe. Russia's 2022 invasion of Ukraine shattered the comforting assumption that conventional, industrial-scale warfare involving major powers was a relic of the twentieth century.
Russia's isolation from Western technology supply chains has been instructive. Sanctions restricted access to advanced semiconductors and high-end components, forcing workarounds through smuggling networks, grey-market procurement, Chinese alternatives and domestic improvisation. At the same time, Ukrainian strikes have repeatedly disrupted Russian refining and logistics infrastructure, demonstrating how low-cost, asymmetric systems can impose real pressure on strategic energy assets.
These are not marginal disruptions. They are proof that software, autonomy, cheap drones and sensor fusion can reshape the economics of war. Defence ministries around the world have absorbed that lesson. Procurement priorities are changing accordingly.
For Europe, the result has been an historic rearmament cycle. Defence budgets have been reset higher, procurement horizons have lengthened, and technology is no longer a sidecar to traditional defence spending - it is increasingly central to it. This matters not only for primes, but for dual-use software, AI-enabled systems, autonomy, secure communications, cyber, logistics platforms and industrial resilience.
Russia, meanwhile, has continued to pursue financial and technological workarounds of its own: the digital ruble, alternative payments rails, crypto-linked state activity, and reported experimentation with new cross-border settlement mechanisms alongside aligned states. Sanctions have inflicted pain, but they have also accelerated ingenuity. That is worth remembering. Pressure changes behaviour; it does not always produce compliance.
Ukraine has also validated some of the most optimistic assumptions around autonomous systems, edge intelligence and software-defined warfare. Technologies that would once have been funded as speculative pilots are now being deployed, iterated and improved in live combat. Adoption timelines have shortened dramatically.
The Strait of Hormuz: The World's Most Dangerous Chokepoint
Hormuz is where geopolitical instability flows into the real economy. It remains one of the most important chokepoints in global trade, especially for oil, LNG and a range of associated industrial inputs. When it is threatened - by direct military action, proxy escalation, drone strikes or even the credible risk of disruption - the effects travel far beyond energy markets.
They ripple into aviation fuel, petrochemicals, shipping costs, industrial feedstocks, insurance premiums, manufacturing input prices and, ultimately, the cost base of technology companies worldwide.
The broader point is not simply that oil matters. It is that modern technology supply chains remain deeply entangled with physical commodities, energy systems and shipping lanes that many investors still treat as background variables. They are not background variables. They are strategic constraints.
The knock-on effects are substantial. Semiconductor manufacturing is energy-intensive. So are data centres. So is industrial reshoring. Chemical inputs matter. Transport matters. Insurance matters. Financing costs matter. If Hormuz becomes structurally unstable, the cost of resilience rises across almost every sector.
That has consequences for where factories are built, where data centres are financed, how airlines price routes, how hardware supply chains are redesigned, and how software businesses think about geographic concentration. The old model of optimising ruthlessly for efficiency is giving way to a newer model built around resilience, redundancy and sovereign comfort.
That shift is not cyclical. It is structural. And it will likely cost more to operate.
Manufacturing is moving home as globalisation recedes
Robotics sits inside the same macro story. Western governments want to reindustrialise. They want to reshore critical manufacturing. They want supply chain resilience without accepting the labour-cost consequences of making everything locally.
That equation requires automation. Especially as, despite occasional political theatre, American workers are not lining up to assemble iPhones. Nor, for that matter, are British workers preparing to save Western competitiveness one screwdriver at a time. The economics point toward automation, full stop.
The twist is that robotics supply chains are also entangled with China. Components, subassemblies, manufacturing capacity and engineering depth remain concentrated there. So the emerging system is not one globally integrated robotics market, but a more divided world: US-aligned stacks, China-aligned stacks and a scramble for trusted alternatives in between.
The Silicon Shield Cracks
The gravitational centre of this entire analysis is Taiwan.
TSMC produces the overwhelming majority of the world's most advanced chips and remains the benchmark at the leading edge as the industry moves toward ever smaller process nodes. That is not merely a commercial fact. It is one of the central strategic facts of the modern world.
The idea of a "Silicon Shield" - that Taiwan's semiconductor importance would itself deter military conflict - still has logic. But its protective power may be weakening. The more China advances its own semiconductor ecosystem, the less absolute that deterrent becomes. The more the United States tries to slow China through export controls and industrial policy, the more it accelerates China's determination to build around the constraints.
Even without a military scenario, the semiconductor supply chain remains tight. Demand for AI compute continues to surge, memory markets remain constrained, and leading-edge capacity is effectively spoken for well in advance. Meanwhile, China is investing aggressively to build domestic capability in AI chips, tools, materials and manufacturing depth.
This is where the picture becomes more interesting than the usual "West innovates, China imitates" caricature. China's catch-up effort is not only about brute-force scale. It is also about efficiency. If the West is pursuing a compute-heavy frontier model path, China is increasingly exploring a resource-constrained path: leaner training architectures, system-level optimisation, cluster engineering, domestic substitutions and materials science breakthroughs that, if even partially validated, could change the economics of the race.
The key lesson is simple: software can partially compensate for hardware constraints, and geopolitical pressure can accelerate the search for alternatives rather than stop it. Investors who assume export controls alone will determine the AI leaderboard are likely to be disappointed.
Let’s look at our four focus sectors to understand what this all means.
Aerospace & Defence Tech: Boom
The current defence cycle is not just larger. It is different.
Global military expenditure has risen sharply, but the deeper shift is qualitative rather than merely quantitative. What is being funded is increasingly digital, autonomous, AI-enabled and software-centric. Defence is becoming a technology market in military clothing.
The implications are profound. Traditional primes remain powerful, but they are no longer the only serious game in town. Start-ups and software-led challengers now have a path to relevance in areas that would once have been impenetrable: autonomous systems, tactical intelligence, electronic warfare, secure edge compute, mission software, logistics optimisation and next-generation manufacturing.
The line between commercial and military technology is also dissolving. That was already true in cyber and space. It is now becoming true in AI infrastructure, cloud, autonomy and industrial tooling more broadly. The rise of Palmer Luckey’s Anduril is not an outlier story. It is an early indicator of a broader realignment in which defence capability increasingly depends on venture-style technology cycles, not just on traditional acquisition logic.
That has a second-order consequence. Frontier technology companies that would once have seen themselves as neutral commercial actors are now being drawn - whether they like it or not - into the defence industrial base. If your infrastructure powers autonomy, cloud-scale intelligence, simulation, robotics or AI-enabled decision-making, you are no longer comfortably adjacent to national security. You are part of it.
For investors, this is one of the clearest structural tailwinds in the market.
Travel Technology: Resilient, Redirected, Reshaped
Travel has survived every shock thrown at it: war, oil shocks, terrorism, financial crises, pandemics and natural disasters. It does not die. It redirects.
Never has that been more true, than now. Geopolitical instability does not remove the human desire to travel. It changes where people go, how far in advance they book, how much reassurance they require, what routes become viable, which intermediaries matter most, and how quickly inventory and pricing must adapt. So long as the Covid-19 pandemic remains fresh in our minds, no one is going to stop us from travelling - unless, of course, the supply of jet fuel dries up while Hormuz is off-limits.
In periods of instability, travel technology becomes more important, not less. Applications that promote cost reduction, real-time risk intelligence, disruption management, rebooking capability, dynamic pricing, alternative routing and cross-market demand visibility shift from nice-to-have features to core operational necessities.
B2B travel infrastructure can be especially resilient in this kind of environment. Hotel suppliers still need distribution. Airlines still need demand intelligence. Intermediaries that can redirect traffic across geographies, source markets and product categories become more valuable when the map is moving underneath everyone's feet.
The structural constraint, however, is energy. Aviation remains deeply dependent on liquid hydrocarbons. If Gulf instability keeps pressure on fuel markets, carriers with younger, more fuel-efficient fleets gain an advantage, and platforms that help optimise yield, route economics and disruption recovery become more strategically important.
For the foreseeable future, some previously favoured corridors will remain impaired or politically fragile. Demand will continue to rotate toward safer zones, friendlier visa regimes, resilient domestic markets and destinations perceived as stable, enjoyable and uncomplicated. Human behaviour adjusts quickly. So does Travel tech.
Software & AI: Capex Takes Us from Seats to Outcomes
Geopolitical pressure is accelerating AI investment, not slowing it.
The hyperscalers remain locked in a capex race. Governments increasingly treat AI capability as a national priority. Enterprises may be more selective, but they are not stepping back. If anything, the strategic importance of AI has become clearer under pressure.
The bottlenecks are equally clear: chips, power, cooling, land, grid access and talent.
That is why energy is now central to any serious AI investment thesis. Data centres do not run on PowerPoint. They run on electricity, and increasingly vast amounts of it. The constraint is not demand for compute. The constraint is whether the surrounding infrastructure can support it economically and politically.
The AI race, in other words, is not a single race. It is bifurcating. One track is compute-heavy, frontier-oriented and capital intensive. The other is efficiency-driven, constraint-optimised and increasingly sovereign. Both are moving quickly.
Meanwhile, AI’s emergence is threatening a decades-old software business model. Software isn’t disappearing, but the model is changing - quickly.
The seat-based SaaS era produced one of the great business models of the modern age: recurring revenue, sticky workflows, high gross margins and compounding market multiples. AI agents now threaten to unpick parts of that model, especially where the value being paid for is workflow completion rather than system-of-record depth.
That is the essence of what some have called the "SaaSpocalypse": not the end of software, but a structural shift from software sold per user to software sold per outcome.
This will create losers. Products that amount to glorified workflow wrappers, data-entry surfaces or low-friction coordination layers are vulnerable if agents can perform the underlying tasks more cheaply and more flexibly. Some incumbents will be acquired. Some will be marginalised. Some will quietly disappear.
But the transition will also create winners. Incumbents with distribution, trusted data, security, embedded workflows and the balance sheet to rebuild can come out stronger. The key is whether they can move fast enough from seats to outcomes without destroying the economics of the core business in the process. (See our November 2025 article).
Cybersecurity stands apart as an especially durable beneficiary. In a world of sovereign AI, adversarial agents, fragmented regulation, data localisation and persistent geopolitical instability, the demand for zero-trust architecture, continuous monitoring and resilient digital infrastructure is unlikely to weaken.
Fintech: The Infrastructure of a Fragmenting World
Money, like water, finds its way through.
The more geopolitics fragments the traditional financial system, the more valuable alternative infrastructure becomes. Sanctions, capital controls, payment restrictions, cross-border friction and regulatory divergence do not eliminate financial activity. They reroute it.
That is why the long-term outlook for much of fintech remains compelling, even if the shape of the winners changes. Sanctions screening, real-time risk analysis, cross-border orchestration, treasury visibility, identity infrastructure, stablecoin rails, fraud detection and adaptive compliance all become more important in a fragmented world.
The developing world matters in this context. As we’ve seen with countless different technologies, developing economies tend to adopt new technologies while skipping legacy platforms. Such is the case with fintech applications in markets like Africa and Southeast Asia.
The crypto layer matters here too, though with considerable ambiguity. Some of the growth is legitimate infrastructure build-out. Some of it is speculative froth. Some of it is plainly connected to sanctions evasion, regulatory arbitrage and state-linked financial experimentation. All three can be true at once.
The main point for investors is not ideological. It is functional. Every geopolitical fracture creates a new plumbing problem. Fintech builds the plumbing.
In that sense, fragmentation is not merely a risk to payments and financial markets. It is also a growth driver for the businesses that help money move, get screened, get reconciled, get verified and get settled under new constraints.
What Gets Built in a Fractured World
Four themes cut across all of this.
First, sovereign AI. Governments increasingly want AI capability on infrastructure they control, under legal regimes they trust, and using supply chains they can defend - a demand that is already reshaping where data centres get financed, how models get licensed, and which software businesses find themselves inside or outside the perimeter of national trust.
Second, dual-use technology. The line between civilian and military applications is dissolving - not gradually, but decisively - across computer vision, autonomy, cyber, logistics and robotics, and founders who think they are building pure commercial products should ask honestly who else might want what they are building.
Third, energy. Compute is energy, manufacturing reshoring is energy, and industrial autonomy is energy - any serious technology thesis without a clear view on energy access and cost is missing the central input to everything else.
Fourth, resilience over efficiency. The defining structural shift of this era is the deliberate move from optimisation to robustness, and the businesses that help others make that transition - across routing, compliance, supply chains and financial plumbing - are among the most strategically advantaged investments available.
The Map Has Changed. The Compass Has Not.
The world described in this piece - prolonged war in Ukraine, instability around Hormuz, Taiwan under growing threat, defence booming, travel redirecting, fintech adapting, AI accelerating and software being forced to reinvent itself - is not a fanciful worst-case scenario.
It is, in broad outline, the new operating environment.
Technology's response will not be retreat. It will be acceleration, bifurcation and sovereign capture. Companies and nations that understand this are already repositioning. The task for investors and operators is not to predict a single future with false precision. It is to build businesses that are resilient across a range of increasingly plausible futures.
The compass still points toward innovation. The map, however, looks nothing like the one we have been using for the past fifty years.
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