Three ways AI is learning to understand the physical world
FeaturedBen Dickson March 20, 2026 Image credit: VentureBeat with Nano BananaLarge language models are running into limits in domains that require an understanding of the physical world — from robotics to autonomous driving to manufacturing. That constraint is pushing investors toward world models, with AMI Labs raising a $1.03 billion seed round shortly after World Labs secured $1 billion.Large language models (LLMs) excel at processing abstract knowledge through next-token prediction, but they fundamentally lack grounding in physical causality. They cannot reliably predict the physical consequences of real-world actions. AI researchers and thought leaders are increasingly vocal about these limitations as the industry tries to push AI out of web browsers and into physical spaces. In…
