This week's AI buzzword isn't actually a new word at all.
It's distillation.
"From Silicon Valley to Washington,
the tech world is suddenly obsessed with one word: distillationi."
Ironically, I first learned about distillation in high school chemistry—not artificial intelligence. Or maybe even earlier, in history class, learning about moonshine, whiskey stills, and the Whiskey Rebellion. And if I think back far enough, distilled vinegar was always around the house. My mom swore by it for absorbing odors.
In chemistry, distillation is straightforward. Heat a mixture until one component evaporates, cool the vapor, and collect it. What's left is the concentrated essence.
Less volume.
Same important properties.
That simple idea has followed me through life in more places than I ever realized.
When I backpack, every ounce matters. Over the years I've learned to distill my pack. I don't eliminate what matters. I eliminate everything that doesn't. The goal isn't simply to carry less. The goal is to carry only what is essential.
Artificial intelligence has borrowed that same idea.
Researchers build enormous AI models requiring staggering amounts of computing power. Then those massive models teach much smaller models. The smaller models aren't identical, but they capture much of the capability while running dramatically faster, cheaper, and with far less energy.
The intelligence has, in a sense, been distilled.
So why has distillation suddenly become headline news?
Not because it's new. The technique has existed for years.
The debate is about ownership.
When does learning become copying?
What happens when one company uses another company's model to train its own cheaper version?
Society will spend years answering those questions. And if you're not noticing the irony, pause for a moment. The largest AI models themselves learned from books, research papers, movies, websites, and countless works created by others. The line between learning and copying has never been easy to define.
But another thought has occupied my mind even more.
The human brain consumes roughly 20 watts of powerii.
I looked it up.
About the same as a dim light bulb.
Yet those twenty watts have built civilizations, written novels, raised children, discovered penicillin, landed people on the moon, built companies, and imagined artificial intelligence itself.
No data center has done that.
Per watt, the human brain remains one of the most remarkable computing systems we know.
Perhaps AI isn't trying to replace that miracle.
Perhaps it's trying to amplify it.
Every generation has invented tools that expanded human computational power.
The abacus.
Paper.
The printing press.
Libraries.
Microfiche.
The internet.
Search engines.
Now AI.
Each one outsourced a little more of the repetitive work so humans could spend more time on higher-order thinking.
AI may simply be the newest tool in a very old story.
It excels at searching, organizing, calculating, drafting, summarizing, coding, and executing repetitive cognitive tasks.
Those are incredibly valuable skills.
But they aren't wisdom.
They aren't judgment. They aren't empathy. They aren’t relationships. They aren't purpose.
They're tools.
Investors often ask whether AI will replace jobs. I'm beginning to wonder if that's the wrong question. The better question may be: Which parts of our work deserve to be distilled away? History suggests we rarely eliminate meaningful work. We eliminate repetitive work, freeing people to create even more value somewhere else.
That realization struck me while reading a recent McKinsey reportiii discussing what wealth management may look like in 2035.
The report argues that technology will automate much of what advisors spend their days doing today.
I think they're directionally right, and frankly, I hope they are.
Not because advisors become less important.
Because they become more important.
At Members' Wealth, we've often said our goal isn't to become the biggest wealth management firm.
It's to become the most personal.
Technology has the potential to allow us to spend less time producing reports and more time improving lives.
Less time moving money.
More time helping families navigate life.
Less time executing transactions.
More time coaching.
More time asking questions that no software can truly ask—or understand—in a deeply human way.
What do you really want your life to look like?
What kind of parent do you hope to become?
What kind of spouse? Leader? Business owner? Grandparent?
How should your finances support that vision?
Maslowiv taught us that once our basic needs are met, our attention naturally shifts toward belonging, purpose, growth, and ultimately self-actualization.
For decades, financial planning has lived near the bottom of that pyramid.
Protection. Saving. Investing. Taxes. Estate planning.
Those things remain critically important and will always be part of what we help with at Members’ Wealth.
But what if technology allows us to handle those tasks more efficiently?
What if our greatest value moves higher up the pyramid?
Helping clients flourish.
Helping them become better leaders.
Better stewards. Better parents. Better partners.
Better versions of themselves.
There's another investment implication worth watching as well.
If distillation allows powerful AI to run on dramatically less computing power, what happens to the enormous demand for chips, data centers, electricity, and cloud infrastructure that investors have been betting on?
One of the biggest investment questions over the next decade (or this week) may not be whether AI wins. It may be where the profits migrate as AI becomes cheaper to build and dramatically cheaper to use.
Does cheaper intelligence reduce demand?
Or does it make AI so accessible that demand explodes even further?
History suggests lower costs often increase usage, not decrease it. The internet, cloud computing, and smartphones all became more valuable as they became cheaper and more accessible. AI may follow a similar path—but it's an important question for investors to keep asking as this story unfolds.
Maybe that's the real distillation. Not distilling intelligence.
Distilling our work until what's left is uniquely human.
Removing repetitive tasks until what's left is the essence of what only humans can provide.
When people hire someone to mow the lawn or clean the house, they aren't buying grass cutting or vacuuming.
They're buying back timev.
AI may be doing something similar for knowledge work.
Not simply making work faster.
Giving us back the mental bandwidth to focus on what matters most.
Whether it's chemistry, backpacking, artificial intelligence, investing, or wealth management, progress isn't always about adding more.
Sometimes it's about removing everything that isn't essential until only the things that truly matter remain.
So, while the debate over who owns what will continue, perhaps the more interesting question is this:
What will we choose to do with all of the thinking time AI gives back to us?
Maybe AI's greatest contribution won't be making machines more human. It'll be giving humans more time to become fully human.
ii https://pmc.ncbi.nlm.nih.gov/articles/PMC2816633/
iii https://www.mckinsey.com/industries/financial-services/our-insights/us-wealth-management-in-2035-a-transformative-decade-begins
iv Maslow, A. H. (1943). A theory of human motivation. Psychological Review, 50(4), 370–396. https://doi.org/10.1037/h0054346
v Martell, Dan. Buy Back Your Time: Get Unstuck, Reclaim Your Freedom, and Build Your Empire. Portfolio, 2023
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Dane Czaplicki is CEO of Members’ Wealth, a boutique wealth management firm that offers a comprehensive approach to serving individuals, families, business owners, and institutions. The firm’s goal is to preserve and grow its clients’ wealth to endure over time, while thoughtfully evolving its strategy to suit an ever-changing world. With over 20 years of wealth management experience, Dane and the Members' Wealth team thrive on bringing clarity and confidence to clients' unique situations. He believes everyone needs sound financial advice from someone whose interests are aligned with theirs, and is determined to put service before all else.
Dane received his MBA from The Wharton School of Business at the University of Pennsylvania and his bachelor’s degree from Bloomsburg University. Outside work, he enjoys spending time with his wife and kids, hiking and camping, reading, running, and playing with his dog. To learn more about Dane, connect with him on LinkedIn.
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