The Integration Age
Reindustrializing the West
The Integration Age: Reindustrializing the West
Maximilian Eichler, October 2025
Every great civilisation faces a moment when renewal becomes a question of survival. The Western world has reached that point. For three decades, it has traded industrial strength for financial abstraction, supply chains for software, resilience for efficiency. The result is prosperity built on fragility - a civilisation that can design anything, but forgot how to build.
In ancient Greek philosophy, ‘palingenesis’ referred to the cyclical renewal of the cosmos. The idea that the universe periodically ends and is reborn, a "world fire" followed by regeneration. In Christian theology it referred to spiritual rebirth - regeneration of the soul or the renewal of the world at the Second Coming.
Many movements that invoked palingenesis didn’t imagine a brand-new order ex nihilo, but rather a return to foundational virtues, myths, or ideals that had supposedly been lost. The idea is that decline comes from corruption or forgetting original virtues, and salvation comes through a purifying rupture that reconnects the community with its authentic foundation.
Today, that same logic applies to the Western industrial base. Industrial dominance and abundant, low-cost energy supply are necessary conditions for every major empire of the past four centuries - they don’t guarantee success, but their absence guarantees failure. The UK, Germany, Soviet Union, Japan, USA, and now the rising empire, China all required it to reach their position on the world stage.
In a unipolar globalisation era, such as 1991 to 2008, an empire can survive, and arguably thrive, without deep industrial might by leaning on reserve currency status, financial dominance, technological leadership, and nuclear deterrence, while outsourcing manufacturing to global supply chains. This model produced decades of prosperity, but also deep fragility.
The world stage has shifted into a multi-polar configuration, where sovereign industrial supremacy is a critical factor to ultimately decide who comes out on top, ideally purely by deterrence. The Western world's neglect of its manufacturing base over the past 30 years has led to an existential cross-road by eroding the very foundation of its historical power.
The West has to find its way back or risk a decline and ultimately potentially a replacement of the Western Empire, the timing of which will be decided by method of replacement: Either through continuously escalating military conflicts or, more likely, a drawn-out economic decline.
The renewal of the Western industrial base does not require more foundational scientific research, nor a centrally planned masterstroke. The West already has the tools: technologies that make manufacturing faster, energy cleaner, defence smarter, and infrastructure cheaper - converging at the right moment. Just as past industrial revolutions were driven by steam, steel, and electricity, today’s transformation is built on AI, robotics, and compute.
The challenge is to apply these tools to the physical economy with urgency and focus, not as scattered point solutions but as combined building blocks of enduring industrial platforms. What is needed is integration and scale: ambitious builders who stitch these technologies into full-stack industrial monopolies that re-architect broken supply chains and deliver physical throughput at scale.
These are the Vertical Integrators: Companies that don’t just invent a component or sell software, but take control of entire value chains, combining hardware, automation, and AI into coherent production systems. Their leverage comes from designing physical infrastructure around software and AI - rebuilding from first principles, not just layering SaaS onto existing processes. They build in the real world - factories, power plants, transportation networks, homes. These companies will look more like the monopolies built during the Second Industrial Revolution, than the software companies of the past three decades.
The 2020s mark a key inflection point: pandemic shocks, US-China rivalry, Russia’s war, and the clean-energy race are driving renewed verticalisation and integration, starting with strategic hardware (chips, defence, energy, component manufacturing), even as other sectors remain modular. Understanding this rhythm - capability-driven integration during geopolitical upheaval, efficiency-driven dis-integration in times of stability - is key to spotting where the next big opportunities emerge.
Unlike China’s state-directed industrial policy, the West’s strength has always been decentralised agency: entrepreneurs, investors, and engineers who act before the state can align. By leaning into that tradition and arming a new generation of Vertical Integrators with capital, talent, and urgency, the West can compress decades of industrial rebuilding into years - and create trillions in enterprise value in the process.
We have all the ingredients and a narrow window to act. In the best case, rebuilding a sovereign industrial base will usher in an age of stability, prosperity, and abundance. In the worst, it will determine the West’s relevance on the world stage.
Today, only a select few see the whole board - the convergence of technology, geopolitics, and economic feasibility. This is a grand attempt to tell the whole story - to help others connect the dots of the big picture, with practical depth and nuance. If the last industrial revolution made the modern West, then this one - its palingenesis - will determine whether that legacy endures.
Disclaimer: All views and opinions expressed are solely my own and not those of any affiliated organisations.
Abbreviations:
VI = Vertical Integrator
RWVI = Real-World Vertical Integrator (= Techno-Industrial Company)
TABLE OF CONTENTS
I. Introduction
Modern empires, such as the UK, Germany, Soviet Union, US, and China, have historically built their power on a foundation of manufacturing, industry, and energy. While services and the financial industry can temporarily sustain power, long-term dominance hinges on the ability to build modern industrial infrastructure, even for AI supremacy. The Western world's neglect of its manufacturing base over the past 30 years has led to an "existential cross-road" by eroding the very foundation of its historical power.
I.II. Macro Cycles and The Changing World Order
Excitement around the AI productivity frontier within the tech bubble masks the reality of most macro indicators pointing to a gloomy time ahead - our multi-polar world is defined by social unrest, chronic regional conflicts, dysfunctional public institutions, global debt at all time highs, increasing stagflation indicators and a return to de-globalisation or isolationist policies.
Decades of offshoring manufacturing has crippled the Western industrial base, which largely relies on foreign, increasingly more unreliable or even hostile actors. Governments are mobilizing $tns, but incumbents lack the ability to not just rebuild, but modernise infrastructure within the time required.
I.III. Why Vertical Integration Is Necessary to Drive Systemic Change
The industrial saviors of Western societies will look more like the monopolies built during the Second Industrial Revolution, than the software companies of the past three decades. They deliver physical end-products by integrating complex, fragmented value chains, combining cutting-edge, but largely proven hardware technology, robotics, and AI software. Their leverage comes from designing physical infrastructure around software and AI to drive a meaningful step change in efficiency and scalability. They ride exogenous technology curves to build products that naturally get better over time - obsessing with execution speed and balancing invention with pragmatism.
I.IV. The Toolbox is Filled – We Just Need to Apply It at Scale
Commoditisation trends in both software and foundational hardware technologies, have lowered the entry barrier to build powerful, yet cost-effective physical end-products, thereby creating a step-change in attractiveness of many Vertical Integrator business cases. Combined with a renewed urgency in industrial and governmental buyers, an adoption flywheel accelerated over the past 24 months, unlocking all the ingredients to rapidly build powerful, scalable, vertically integrated, Techno-Industrial champions.
I.V. Talent & The Power of Storytelling
Technological progress concentrates where the most talented people choose to spend their time - and they’re increasingly drawn to hard, system-level problems in manufacturing, energy, and defence.
Vertical Integrators can translate complexity into a clear, mission-driven narrative, turning thousands of uncertain facts into a single, recruitable thesis people can understand, evaluate, and commit to. That clarity and purpose creates an edge in attracting the most talented people and thereby an increased probability of success.
II. Vertical Integrators
II.I. The Opportunity - Where I Would Place My Bets Or Build Today
The drivers in previous chapters have sufficiently lowered entry barriers to unlock a Cambrian explosion of Vertical Integrators across five themes where an urgent need and readily available technologies have already converged: Manufacturing, Defence, Construction, Energy, and Commodities.
Their market positioning is similar to incumbents - as contract manufacturer, general contractor or energy provider - selling into existing procurement streams, but delivering a superior product or service across various dimensions.
II.II. A Wildly Misunderstood Category
Vertical Integrators are often misunderstood and mislabeled - especially in Europe. They’re dismissed as too capital intensive, hard to scale, misaligned with VC timelines, unpredictable in revenue, valued on low multiples, or lacking defensibility because they rarely start with deep IP moats. While there are failures that reinforce these fears, treating them as universal truths is as misguided as claiming “SaaS doesn’t work because of high churn.” In practice, most of these concerns are overstated and there are clear mechanisms to solve them. The mistake is in treating these challenges as fatal flaws, rather than design constraints that can be overcome. Fine distinctions matter: capital intensity vs. dilution, recurring vs. predictable, scalable vs. exponential, margin vs. value capture.
II.III. Caveats, Why I Might Be Wrong, and the Place for SaaS
Vertical integration is a powerful strategy, but only when it solves real fragility, enables system-level optimisation, or creates step-change improvements in performance, cost, or resilience. Core technologies should already be proven and simply need to be recombined or integrated with AI software in a real-world context. Crucially, fragmentation must originate from coordination gaps rather than structural constraints.
Survivor bias can skew perceptions of capital efficiency, scalability, and defensibility - those traits apply to the breakouts, not the entire category. Scaling risks are real, but they can be mitigated with the right model and timing. Meanwhile, geopolitical pressure is rising, but broader global escalation remains uncertain.
III. Conclusions & Actionable Practices
III.I. So what? Actionable Practices & Asks
The motivation for this paper is to help others connect the dots of the big picture, with practical depth and nuance - sharing observations about the path on which Vertical Integrators could succeed. From that path, I have distilled a set of actionable principles for strategy and execution.
In Europe, Vertical Integrators remain deeply underestimated. For those who act early, this represents one of the great arbitrage opportunities of our time.
Almost akin to a law of nature, as the ingredients converge, we are starting to see a Cambrian explosion of Vertical Integrators. Yet many white-spots are untapped, many investors still avoid the category, and many VIs fail for avoidable reasons or at least fail to reach their full potential.
The gaping problems in our industrial base have been clear for many years, the solution clear for a few, what has changed is the urgency. The current geopolitical reality requires us to upgrade and scale our industrial base within a short 3-5 years. We need Vertical Integrators with GDP-level impact - and many of them. A herculean task, but with the tools at hand and our brightest minds committed, success is part of the set of possible outcomes and I am cautiously optimistic. The urgency drives innovation and scale and at the end of the tunnel we can see an abundant, safe, and prosperous future for the West.
Next Chapter:
0. Prologue