Founded and built @loopinternet; acquired by Greenlight in 2025 and T-Mobile in 2026. Building more internet @ Layer1
Philly & Middle of Nowhere VA
Joined October 2008
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The demand for wireless capacity is going to be unlike anything we’ve ever seen before due to AI, robots, wearables, etc. There’s going to be immense amounts of data transmitted from your personal AI to the cloud 24/7.
If this is something you’re interested in working on, DM me.
Chris Hacken retweeted
With AI stocks down 20% to 50%, I keep getting asked whether the AI trade is dead. I was in the market during the dot-com boom in my early twenties, so let me put the two side by side.
Duration first. The dot-com boom ran 5.3 years from Netscape in 1994 to the peak in 2000. The AI boom, counted from the ChatGPT moment in late 2022, is 3.9 years old. If it merely matches the dot-com in length, there are 1.4 more years to go.
Then magnitude. The Nasdaq 100 rose about 1,000% during the dot-com boom. In the AI boom so far it is up 137%, which is roughly 13% of the way there.
Now the poster boys. Cisco was the most important stock of the dot-com era, and at the 3.9-year mark it was up around 700%. It went on to peak at 4,200% on a forward P/E of 131 times. Nvidia at the same point is up about 1,000%, and its forward P/E is 17 times. Cisco was priced for perfection. Nvidia is priced like a mature industrial.
I am not forecasting that Nvidia goes 4x from here. I am saying that on both duration and valuation, this boom is nowhere near where the last one ended. That is why I treat these pullbacks as rotations within a bull market rather than the end of one.
Learn to invest and trade at piranhaprofits.com
Maybe it's just me, but the future seems more uncertain than ever.
Not in a, we're all going to die, kind of way, but in a... I have absolutely no idea what the world is going to look like in 5 years, kind of way.
Everything seems to be moving incredibly fast. I feel like there was once a time when you could keep track of most major technological advances that were happening in the world. Everyone knew who the hot startups were, who had just raised a big round of funding, etc. Now.. it seems like there are thousands, or tens of thousands of companies all doing incredibly ambitious things.
This will be interesting to see... Has $IREN secured a decent chunk of that? Even if Iren only gets 5% of that $895Bn, we'd be looking at $45 Billion in commitments, that's enough to send us to $70-100/share.
I fully liquidated my $CCOI position at $8 roughly 2 weeks ago. I don't think it will come to this, but creditors seem to be lining up preemptively in the event Dave can't refinance.
news.bloomberglaw.com/bankru…
Which seems more and more problematic every day that goes by.
Elon rug pulls Grok Bot limits because of compute.. and in the same breathe everyone’s saying Neoclouds are going under because demand is going to go down.
Ya okay.
I keep seeing posts saying there’s a Compute glut… ya that’s why xAI is trying to build 1GW of compute per month. 🙄🤦♂️
Everyone’s an expert when the wind shifts their way, even if it’s briefly.
We’re missing a key component here. Using this example… The airline would only have enough fuel for 100 flights a day, which would drive up the cost of each seat. And it takes 2+ years to increase the fuel supply.
If you’ve seen Ken Griffin comparing neoclouds to airlines (notoriously bad businesses) and wondering where that’s coming from, this is a good intro read for you.
The central argument is that neoclouds have airline economics, but are increasingly being financed and valued as though they have much more durable cash flows.
A few takeaways:
1) Compute is perishable inventory.
An empty airline seat after takeoff is revenue lost forever, and so is an idle GPU-hour. 85%+ of the cost base is fixed, and the marginal cost of serving another customer is almost entirely electricity.
This creates enormous operating leverage but also brutal pricing dynamics when capacity exceeds demand, hence why Griffin warned that GPU rental prices could collapse in an oversupplied market.
2) Utilization drives everything.
Airlines generally break even around 80% load factors; a leveraged GPU cluster might break even around 65–75% utilization.
Nearly all the economic upside comes from those final percentage points so a relatively small decline in utilization can wipe out the equity.
3) The suppliers may capture more value than the operators.
NVIDIA is effectively Boeing + Airbus combined, controlling hardware supply and the upgrade cycle.
The scarcity of powered datacenters and grid interconnects gives the infrastructure owners significant bargaining power.
Neoclouds risk being squeezed between the hardware manufacturer, the infrastructure landlord, and increasingly commoditized compute pricing.
4) The financing looks remarkably like aircraft ABS.
Wall Street is financing GPU clusters through bankruptcy-remote SPVs, often using 70–80% LTV structures supported by multi-year contracts.
The contracts make the cash flows financeable, but the equity highly leveraged and sensitive to assumptions.
5) GPU asset life is uncertain.
A data center is analogous to an airframe, potentially useful for decades.
GPUs are aircraft engines, with faster technological obsolescence and no maintenance overhaul that restores their economic life.
TLDR: A business can grow revenue enormously while generating mediocre returns on invested capital. Airlines have demonstrated that for decades.
Alex’s full analysis goes much deeper into the aircraft ABS comparison, the capital structure, and the underlying economics.
Very much worth reading in full:
alexyangsong.com/blog/alumin…
Deep AI integration into every aspect of your business will soon be the only way to survive.
However, for now it's leverage, margin, and a massive competitive advantage.
I've never run a business with so much clarity before.
All of these corporations who claim they aren't seeing returns on AI are doing something wrong.
I'm running my telecom construction company with zero admin staff. @openai Astra is analyzing everything behind the scenes, likely with 100x's more accuracy than a human would.
Market is getting kicked in the teeth right now.
Does the Nasdaq being nearly 4% down in a day count as a crash?
I recommend that you don't upgrade to X's new all-in-one Grok/Cursor plan.
I'm still paying $200/month but now I need to pre-pay for Fable credits and it says Fable credits aren't included in the Ultra plan at all. It's trying to force you to use the cheap Grok models.
What a bait and switch @elonmusk
