Neocloud, Colocation: Are we back?
Hosted by @₿itcoin ₿utcher 🥩 🐑 🐷 · 2026-08-12 · Tags: CRWV, IREN, NBIS
TLDR
Host and guests treat CoreWeave and Nebius earnings plus firmer colocation comps as a potential narrative turn after weeks of AI infrastructure pain. Discussion centers on longer GPU useful lives, Nebius’s three-bucket revenue model including burst pricing, Iron’s perceived reactive execution versus White Fiber’s retrofit agility, and whether labor or power will bottleneck builds. Tone is constructively bullish on a large multi-winner TAM while still debating who executes and finances best.
- CoreWeave and Nebius calls cited as shifting sentiment after six-to-eight weeks of selling
- A100s contracted through 2029 undercut short depreciation/obsolescence bear case
- Nebius buckets: hyperscaler anchor deals, high-potential frontier labs, and burst pricing up to $40-50M per MW
- Payback under two years for some neocloud hardware leaves multi-year cash-flow tail
- Colocation comps rising: Riot ~$2.4M and Fermi ~$2.7M average annual per MW
- Cipher hit by Texas ERCOT batch-zero pause; pipeline heavily batch-zero into 2027
- Iron praised for power/vertical integration but criticized as reactive versus Nebius agility
- White Fiber highlighted for experienced Tier-3 team, retrofit speed, and multi-revenue flywheel
- Financing, prepayments, and GPU access seen as decisive competitive edges
- Labor shortage debated; oil-field analogy argues money clears skilled-trades bottlenecks
Speakers
- ₿itcoin ₿utcher — Host framing the session around a market turning point; reviews CoreWeave/Nebius takeaways, rising colo comps, Cipher/NUAI/Wolf/Iron holdings, and moderates civil multi-name discussion.
- Marcus — Expands on Nebius strategy from his article—hyperscaler anchors for cheap financing, high-potential labs, and opportunistic burst auctions; contrasts Nebius market agility with Iron’s asset-first focus.
- Mark — Argues Nebius and Iron are both winners on different timelines and paths; warns against tribalism and short-term stock-price anxiety.
- RJ — Explains pivot from Iron power thesis to White Fiber’s experienced data-center operators; frames market split between tech operators and pure real-estate/power plays; raises remote-site labor concerns.
- Austrian — Praises White Fiber’s consistent retrofit/agile strategy, cloud contracts with low GPU CapEx, and NC1 financing flywheel; criticizes Iron management trust and urges per-share/levered return sophistication.
- Jeff Ward — Counters labor-shortage fears with oil-field and trades experience: money attracts mobile skilled crews; distinguishes construction versus maintenance pay and East Coast versus West/Texas cultures.
Notable quotes
- “And I think after getting our asses kicked the past- Six to eight weeks at a minimum that today to me felt like a turning point, where most notably the last two days, it started last night with CoreWeave's earnings call, and that was followed by Nebia's, earnings call this morning, and I think the narrative's beginning to shift back in favor of AI” — ₿itcoin ₿utcher
- “they were able to contract a one hundred through twenty twenty-nine at a reasonable rate, meaning the life of that asset was actually nine years as opposed to the calls for two or three years due to tech, technical obsolescence from notable bears like Dr. Michael Burry and, Jim Chanos.” — ₿itcoin ₿utcher
- “both of those were leases that, I, I'm not sure what they're at in year one because a lot of the leases have escalators over time, but the average annual lease for both of them was in excess of two million dollars, and I believe Riot was approximately two point four million per year, while Fermi was about two point seven per year” — ₿itcoin ₿utcher
- “I kind of called it like surge pricing, I compared it to like having an Uber or a Lyft where There are a lot of labs that have these temporary, immediate needs for compute, and they're willing to pay almost anything” — ₿itcoin ₿utcher
- “You want the hyperscalers, they, they are already, very mature, a lot of it, they're currently building their own data centers also. A lot of their current demand is gonna be overflow in the future. And what you want is you want to anchor them, as a client customer for a little bit lower rate because you can use their credit for your asset backed financing.” — Marcus
- “And they bid up to forty, fifty million per megawatt.” — Marcus
- “Currently, Irena Management feels very reactive to me and like that the world is going open for them now and then. I get back to my, to my point, how in touch with the actual market are they?” — Marcus
- “I think they're both winners, and I don't, I'm not just speaking from this being just a, you know, an addendum to the normal Sunday night Iron Space. These companies are both gonna be winners, they're on different timelines, attacking the opportunities differently.” — Mark
- “I think White, White Fiber is brilliant because their strategy's been consistent. I think they've shown the best of that. I think they're really agile like Nevious.” — Austrian
- “They throw money at the problem, and it works every time.” — Jeff Ward
Transcript
₿itcoin ₿utcher: How's everyone doing this evening? It's 8 o'clock or 2 minutes past here in Detroit in the United States. I believe we have a few people from Europe on, so I appreciate you staying up late for us, and if there are any of our European friends who wanna come up Sooner, just request and I'm happy to share the stage. my goal this evening, pretty big day in the market, I have the title, "Neocloud Colocation: Are We Back?" And I think after getting our asses kicked the past- Six to eight weeks at a minimum that today to me felt like a turning point, where most notably the last two days, it started last night with CoreWeave's earnings call, and that was followed by Nebia's, earnings call this morning, and I think the narrative's beginning to shift back in favor of AI, and conveniently you're beginning to see a lot of disclosures from the larger banks banks increasing their ownership positions in some of our favorite names. So at a high level, I'll kick things off with what I see in the marketplace, maybe speak to a few companies in particular. I know there's some passionate people, like most notably, that I've gotten the chance to meet with the last few days from the white fiber community that wanted a chance to talk about the great things they have going on. I think they were well over twenty percent today and might have even- Touch twenty-five percent. So if anyone else wants to come up, I saw cores requested, core scientific that is, Fermi, Saluna, like I think the coolest thing about being a part of this ecosystem is, yeah, I own a handful of companies or fewer, but I still keep track of everyone 'cause you have to daily keep track of whether it's competition or just where comps are going for colocation deals, but it, it feels like every day there's something new and we're at the forefront of a, a revolution that is AI, and I feel privileged to- To be part of it, and I feel privileged that you guys wanna share your time away from your family, your friends, and talk about it. So, again, thanks for coming out. Let's kick things off. with respect to the NeoClouds, I touched on CoreWeave and Nebia's earnings calls. I'm sure there's people that own it, that are on here if they wanna come up and speak to it. I'll do my best, from an outsider's perspective. Main thing I took away from the core weave call is they were speaking about their, their hardware use and how they were-- one of the key takeaways I took from that specifically was there are what are called A100 GPUs that were initially released in 2020 and kind of one of the main bear thesis stood on this idea that the depreciation of those assets was less, or I should say fewer than five years, but with Corey specifically, they mentioned on their earnings call that they were able to contract a one hundred through twenty twenty-nine at a reasonable rate, meaning the life of that asset was actually nine years as opposed to the calls for two or three years due to tech, technical obsolescence from notable bears like Dr. Michael Burry and, Jim Chanos. So that in itself Is pretty important when you consider for the neocloud specifically, and White Fiber being one, and there's others, I don't know, Cerberus and some others are doing hybrid solutions, but if you can get a two to three year payback, and I think Nevious even reported below two years on their call today, and have an additional three, four, five, six, seven years to generate operations Cash flows at reasonable rates, that's a great, great signal for the space, and it, it shows that this is, While the gap profitability is still lagging for, CoreWeave and Nebius, and that's something I would like to see progress in the next twelve months, you can see at a minimum though that they're beginning to scale and that their hardware is gonna last longer and that, that depreciation, even if they have five or six year lives on the assets, that they can expect to generate income for at least those five or six years and in some cases as many as nine for Older generation GPUs. I think that's gonna change going forward as Vera Rubens introduced, I say that because if you're able to buy new hardware that can produce A lot more tokens per megawatt than it's in your best interest to switch to, i-it's a break-even analysis where it depends where the pricing is of the legacy GPUs, and I'm also assuming that The infrastructure owner or the colocation tenant is able to update the infrastructure within to accommodate the applicable rack densities, but long term, this is gonna be a world of Ruben, in my opinion, and I think Jensen's the most important man in the space right now because he controls the allocation of those Rubens as they come out. And, so I spoke to Core, we even Navius, I didn't speak to Elon's call, I haven't had a chance to listen to it, but I saw- Saw a pledge for as many as ten gigawatts being built next year, which I'm not sure that will necessarily get done, but it does make me think with a one trillion dollar market cap for SpaceX that they're probably in the market looking to buy infrastructure instead of having to source their own land and go through that process. So that might be an opportunity for them to speed up their ability to build capacity. I think realistically- Basically, I, I know they built Colossus in record time and skip permitting and kind of made things up and used their own, I believe they were ship engines that they were using, they repurposed to power the data center. So Elon is, no one doubts his creativity, but one of my friends in a Iron Chat, Noel, had mentioned that there's such a scarcity for the labor right now where I'm not sure Elon will be able to source The people to conduct this plan, but if someone feels differently, come up and let's talk about it. But realistically, like Iron specifically, I know it's guided for seven hundred and thirty megawatts to come online next year, and I've seen Corweave last quarter added five hundred megawatts. So if Corweave's doing five hundred in a quarter and Iron's doing a few hundred, you know, maybe Elon can reach two to three gigawatts, and if that's the case, I think what's Important for the neo cloud space again is that allocation and who's at the front of the line for Ruben, because whoever has Ruben first will be able to price it however they see fit, 'cause they have no competition. And if they're able to lock people in, they're able to generate more cash flow that they can recirculate into their respective businesses and rely less upon debt or new equity issuance. So that's kind of a high level view of what I see See from NeoClouds, self-admittedly, White Fiber, I didn't have a chance to look as close as some of those folks would have liked, but I saw a few members of that community if they wanna speak to their new deal that got released after hours, I believe that was a hundred megawatts for some GPU capacity, I'm not sure what kind of GPUs. I saw a separate post from Small Cap Sniper that was related to Vera Rubin usage for that respective company. So, again I don't, I disclose what I own. I own Iron, I own Cipher, I own Wolf, I own NUAI, and I'm happy to speak to those because I'm in the weeds on those, but if someone wants to talk About their community, no problem, just invite themselves up and I will accommodate. And, just ask that everyone be civil to each other and avoid the tribalism. And I, I think it's, a show and tell for the space. And I just had a sense this morning when I saw CPI come out Where it was expected and not too hot, and then you hear the CoreWeave call last night and Nevious, it, it just felt like with those having the two largest market caps in the space, that they kind of set the tone for the rest of the neolouds and colocation providers. So those are some of my opening thoughts on those respective providers. the day prior, though, I did notice, Riot had signed a deal with, I believe, was Anthropic, which was an add-on to, I believe it's the Rockdale site, and that, you know, previously they had signed capacity to AMD, and now this was the second iteration on that site, and then also Fermi, the, startup out of Texas. That has a lot of behind the meter energy was able to sign a really attractive deal with, I believe it was an AI lab, and the name's escaping me. I found those in particular pretty important because the comps on those, when I say a comp, just a, a re- another deal that you can compare to when you're trying to forecast pricing going forward, but both of those were leases that, I, I'm not sure what they're at in year one because a lot of the leases have escalators over time, but the average annual lease for both of them was in excess of two million dollars, and I believe Riot was approximately two point four million per year, while Fermi was about two point seven per year, and that just kind of shows that if you were to plot the executed deals for colocation in a time sequence, that you would see that the line is- Going up and to the right, and that's favorable for the colocation comps. Specific to the MyHoldings, NUAI has a earnings call, next Monday. Hope they provide some more information on whether they were able to secure a PPA, which is the power purchase agreement, for two hundred seven megawatts. Coincidentally, that same PPA is, overlaps with Cipher, which I can talk about in a second, but that, anyway, specifically, they are trying to build a data center on their, Midland site, I should say, and that land is adjacent to actually Cipher's Odessa. Bitcoin mining facility that they're looking to transition. So just to wrap things up on NUAI, they have earnings next week and they have, outstanding joint venture agreement that needs to be signed with Stream Data Centers, and ultimately they look to sign a lease by the end of the year at that site, so that's something I'm looking forward to as a shareholder. As it relates to Cipher, I think what's pretty important is most recently, I failed to mention the pause that, initial-- initially there was the New York moratorium on data center building, which impacted Wolf, even though Wolf just signed Anthropic and is trading back in the teens after Increasing their NOI, and that's just a stock that appears to be wrongfully under pressure right now considering how they've executed, and if you've missed the interview that Patrick Wolf, or excuse me, Patrick Flurry of Wolf had with Mcnally Money, or I was able to talk with him, those were both really good. insights into what the company's trying to accomplish, and for people that are most concerned with dilution, like Patrick said multiple times that he has enough cash on his balance sheet to fund new projects going forward or even buy new sites, so that's why I think right now Wolf is a good opportunity, not financial advice. as far as Cipher goes, that New York moratorium actually transitioned and made its way down south to Texas, and that Kind of led to a scare in the marketplace, and Cipher prior to their earnings was trading as high as twenty-five dollars a share and went as low as sixteen dollars and change, and recovered quite a bit today, but Biggest problem for Cipher right now is a lot of their pipeline is related to the batch process, and to back things up, the batch process was Urkot, which is a private quasi government agency that handles the Texas grid was trying to figure out who would approve, how to approve over four hundred gigawatts of power, and by doing so, they created criteria including deposits and water and electrical usage surveys and went through this whole process that companies like IronHut and Cipher went through or even CleanSpark trying To get their spot in line and get rid of the land speculators. So when I listened to that call from Tyler, it felt like he was caught a little off guard by the governor's, requests to pause that process in the interim and have ERCOT work with the Public Utility Commission. So that caused quite a bit of fear in the stock, but then a note came out as of yesterday, I believe Matthew Siegel provided coverage of that, and that just simply said that A lot of those batch zero approvals are scheduled for energization in twenty twenty-seven, and it was the intention of ERCOT to work with the utility commission to keep those on track, most notably I saw Beacon Point of Hutt. So if Things are back on track and this is just political narrative for a few weeks so that Abbott can get a win while he's trying to get reelected politically, which is what I think this is about, then I expect in November or maybe a few months after, once the election is passed, for Texas to reopen for business with a more controlled process, which will favor the larger colocation providers, most notably Cipher, who I believe they have two point nine gigawatts out of their four point one in their pipeline related to batch zero, so that would bring a lot of momentum back to that specific equity. As far as I, I'm trying to think if there was any other news. I saw a note from Siegel as well on-- I haven't had a chance to research it enough, but I'm more pitching a lot of these ideas as topics if people have researched it and wanna come up, but the, The rules for securitization as it relates to, with the SEC related to data centers, I believe there was an opportunity with fewer-- I don't know if it was fewer disclosures or fewer requirements, but it would make it easier for someone like CleanSpark or, like Galaxy recently had a note offering and had almost a ten percent interest rate to fund their data- The center with CoreWeave, but if the rules get a little easier and more investors can pool capital, maybe that ten percent turns into nine and a half or nine percent or even eight and a half. I think that's primarily why the market has rewarded, Cipher and Wolf to this point as the largest market cap colocation providers, is because they have triple A tenants like Amazon and, Google and Flu-- well, FluidSec via Google, but with that parental, not parental, but the Financial guarantee, implicit guarantee backing it, so that makes it easier for someone to underwrite those cash flows and give out a better rate of lending. And I think you're seeing that with the neolclouds too. Marcos, who was in here, I don't know if he dropped off, but he had a nice article on the Nevious call, and I think this is important as we go forward. Whether you're in colocation or you're in cloud, the biggest constraint right now, there's certainly a hardware constraint, but right now it's just having readily available data center capacity. And I think in this environment, it's actually more favorable to the neolabs because they have more optionality with how they deploy that, and let me explain why. I just talked about, like, I own Cipher and they have four hundred seventy-seven megawatts that are available to be leased out this upcoming year, unless the batch process allows for more of their power to get released. Those four hundred and seventy-seven megawatts most likely will be colocation agreements that are fixed lease rate contracts, maybe with an escalator, but the idea is they know what they're gonna make and it's set in stone for likely the next fifteen to twenty years. What I thought was very telling from the Nevia's call was they have three ways that they kind of bucket their revenue right now That Marcos described, the first of which was larger CapEx projects with higher quality, tenant tenants that help build the infrastructure, so most notably like Nebius has a project with Meta or they're doing bare metal for Microsoft, where those are lower margin deals, but Initially that helped them scale the platform, and it also provided some certainty, like most mo- excuse me, most notably with Vineland as they were building their own data center as opposed to leasing it out from a third party. The second bucket where things get really interesting is you have AI labs and frontier labs that will pay more for compute, as much as twenty million dollars annually per megawatt And maybe even as high as twenty-five million in some contracts, and those tend to be two to three year agreements, and the idea with that is, those are smaller entities that might be taking up less space But in the event that they grow in the future, you get to have a higher blended margin, but you're also investing in your future as a cloud provider and that you're trying to find the next strategic partner that can grow with you instead of relying on the hypers, because there's always the threat that the hypers just build their own DCs in the future to accommodate their requests. Just approving a request right here. Looks like we got Marcos up here. I'm gonna just finish this thought, Marcos, and then you can speak to it better. so that was bucket number two. The first was basically the hyperscaler, the second is the enterprise, the sovereigns, higher-margin business, two to three-year contracts that work favorably for a cloud to make a little more money per megawatt. And then the last piece, which I thought was the most interesting Is they have, I don't know if he, I think he coined it, burst pricing. I kind of called it like surge pricing, I compared it to like having an Uber or a Lyft where There are a lot of labs that have these temporary, immediate needs for compute, and they're willing to pay almost anything, and in the event that you're able to find such A customer, there's two things that are beneficial to it. One, they're willing to pay as much as forty to fifty million dollars per megawatt, and again, this is a very small percentage of their portfolio, and you shouldn't model that for every megawatt in someone, in a cloud's portfolio, whether it's Iron, CoreWeave, White Fiber, or anyone else who's providing cloud services. But the other thing that I thought was more telling was some of the new customer relationships That by having readily available compute and by leasing it on demand, I think Nebius was able to create a few new relationships that they might have not had otherwise, or at a minimum, cut down their customer acquisition costs in the future and cut through a sales process and just simply let five or six companies who want compute to bid on it, and just whoever had the highest bid gets it, and then at the same time, it's an- Opportunity for them to, one, provide the service, but just show them what life would be like with them or so, I, Marcos did come up, I think he can speak to it better Marcos, you're free to speak about your article, the, any other earnings calls that caught your attention, or if you have any commentary on the co-location space. Thanks for, coming up, and I'm glad I could start this a little earlier tonight for you since you're in Europe.
Marcus: Yeah, thanks for having me. I was planning to go to bed early, but, yeah, I got stuck up. I really don't have much to add because you already touched up, touched up, the core of Nubia's earnings call. And a lot of people overthink it really, but if you just take it to the basics, even if you look at your own portfolio, management, at least if you, if you manage, a lot more money. You have, you have your stabilizers, let's say the companies that comp- that compound strongly over, over certain years, that have a strong moat, let's say the Nvidia's, the Googles, et cetera. Then you potentially allocate a part to companies that are a little bit more speculative but give higher upside, and then you have your real speculative plays that you say, "Okay, this is a lot of upside, right?" So what Nebius does, and it isn't the talk of the day is like, "Oh, it's super smart strategy, et cetera, how did nobody think of it?" But it's actually something, I wrote about it already last year, it's the most logical way to play, to play this space. You want the hyperscalers, they, they are already, very mature, a lot of it, they're currently building their own data centers also. A lot of their current demand is gonna be overflow in the future. And what you want is you want to anchor them, as a client customer for a little bit lower rate because you can use their credit for your asset backed financing. So that's where you start when you're building the foundation of the business. You want the capital and you want the low credit rate, to build out your capacity. Once you have that founded Then you're gonna look, I call it in my art-article, the high potentials. Essentially what you want to do is, if you build a stable business and you have a foundation standing that, that gives certain revenue with the hyperscalers, then you're gonna look for clients who are ambitious, who operate at the frontier side Who, if you land them as a customer, you're almost certain, that they're gonna need extra capacity in the future, and you essentially help them build scale Those customers have a way longer lifespan than the hyperscalers have. And so that's why you focus essentially your core business on. It's, it, it's super logical, it's almost the same at every business, it's not neocloud, special And then what Nebyus did really well, our management itself said, that they didn't really saw this opportunity in front, it kind of presented themselves. They had some extra capacity, they said, "Uh, okay, let's just throw it at an auction and see if somebody's crazy and would, would like it." And then they were essentially a little bit flabbergasted that there were a lot of smaller, frontier companies. also some bigger ones, but that needed immediate compute for some kind of training cluster or whatever that, that they want to get online. And they bid up to forty, fifty million per megawatt. And essentially those companies, if you provide them with the immediate compute, Arkady said it himself also, customers happy You build relationship with new upcoming players, again, that who, who can move in the future to the high potential range, and you get, you get a lot of money for, For the excess compute that you have. And I think Nebius navigated the market really smartly by really looking at the market and how the market is going to, to develop. versus other peers, core we've also more of the longer contracts and Nebi has already understood, in my opinion, way better that you Don't look at, at the assets that you have, but you, that you look on what the market wants, and then you position your assets in line with market wants. And we talked about that also, I think, Iron Focus too much, on, oh, we got the power land, that's an asset, and, let's keep it tight and let's see what we're gonna do about it, and totally lost a little bit the focus on where the market is navigating to. I own Iron too, I own Nebius, also, yeah, like you know, three days after they, re-listed, in October 2024 and that's something I would see, I would love to see from, from especially Iron Management also more. Like, I feel they, they disconnect a little bit from the market and focus on their own build. but you want, you want to have a fluent relationship with that to, to get the best opportunities. Otherwise, you, you, you tend to blind yourself a little bit on what's possible. So yeah, I was really, I was really impressed by the Nebya's earnings call. I love the strategy that they are doing. I love that they focus on, on the high potentials, because customer mix is gonna be crucial in the upcoming years. they can't ask more also because it's a pretty simple negotiation if you are one of the high potential, let's say an enterprise or an AI frontier lab. It's pretty simple if you can get, let's say, fifteen million of a hyperscaler with credit rating, which you can use your asset-backed financing on And then a smaller enterprise come that has a higher future run rate. The, the negotiation is pretty easy, you're like, "Yeah, you have to pay up like five to, to seven, million per megawatt more because you, you don't have a credit rating." So putting them into buckets in terms of negotiation is actually also not that really hard because they don't bring credit to the table, so it's more riskier and they can't put their asset-backed lending against it, so they have to pay up more for mekowads. So that's what you're seeing in as a whole trend as Nebius pointed out also, through the whole market. So I think all neo clouds will, will benefit, but the ones that strategically focus on market needs and know to adapt I praised Nebius about their agility, is something I see less with the other neo-clouds, and I'm curious what your view, view on that is because I think a founded base with agility on top is the way to go.
₿itcoin ₿utcher: I think it's a little too, I- I can praise what Nevious has accomplished, and I came out with a post earlier where, with Dan specifically, I think the overhanging question is How they plan to fund all this infrastructure, and part of my, critique as a shareholder has been, I understand waiting and not contracting all your capacity right away, but if you're able to get smaller wins to not only- I think the, just change the conversation, I l-labeled the post, but it, like specifically as it relates to air-cooled capacity, if you can get to market sooner and the market is desperate for compute, that feels like an easy win to acquire customers and take advantage of pricing right now, and everyone knows that iron has no shortage of megawatts, so I don't leasing out fifty to even two hundred 200 megawatts when they have 5.8 gigawatts disclosed or as many as probably 10 to 12 overall, I think that would have addressed some of the execution concerns and even served as a customer acquisition funnel. What I would say though is in their defense, they, at the beginning of the year, I think If I had to guess how things played out, they were trying colocation, initially realized the returns were way better in cloud or bare metal. Switched to that bare metal approach, sign, Microsoft, realized that dealing with hypers would legitimize the platform, but they wanted more of the To generate more revenue per megawatt, and then ultimately how that came to be with Jensen, I still can't figure out the origin. My best guess is that they wanted better Access to GPUs and the only way to do it was to create that strategic relationship that's not formally an equity-based relationship yet, and ultimately, this also speaks to a theme, Marcos, with the The NeoClouds, like you're beginning to see the battle lines drawn with the fact that Jensen has split out the NeoClouds from the Hypers and their financials for Nvidia, it was very telling to me. And I think even the smaller clouds, I had mentioned White Fiber earlier, I know like, Brune is like partnered with Nevious, but I even think like that cohort If they can find access to compute, like Jensen would rather have a distributed base of buyers. I mean, there's an advantage to having concentration in larger buyers, but he also wants to protect his margin and not to mention the fact that some of his key customers, most notably Amazon and Google, were creating Their own ASICs to compete against the NVIDIA GPUs. your original question, though, as it pertained to Iron specifically And even Corvee, I think where Iron, I think there's more going on in the background that we're told, and I think that's the problem more so, and I do think with Given the new hires that they just had recently, as they're trying to incorporate cybersecurity or software solutions, or they just had a acquisition of Morana that's still only a few months old, like, I think there's so much work going on in the background that just the final product's not there yet, and I just, I think- I wanna give Dan the benefit of the doubt, or I should say the opportunity at least, to speak to it more at earnings, but if he's still being evasive at that point and not talking about I mean, they provided a little guidance on the increased pricing that they were able to execute and the fact that prepayments, I didn't even mention prepayments, whether it's Iron or Nevious, like if you're able to secure Fifty to sixty percent of the price of a GPU upfront, it's way easier to finance that, and it's way less working capital intensive, and then it's just a matter of building your capacity out and plugging in, and usually those contracts are two or three years, and if Nebius is paying back in under two years and Iron's at a minimum two and a half years, that means years You know, three, four, five and six are just cash flow to circle back into this, the system. So I think both Nebius and CoreWeave were just a little further along because they had a head start and Iron didn't pivot as soon as those two companies, but I think it's a little premature I mean, I'm as frustrated as anyone as a Iron shareholder about this year and being essentially flat after seeing, you know, eighty bucks last November or whatever it was, or seventy-five or seventy-seven, wherever it peaked out, but I also know, like Both things can be true that, yes, it's disappointing year to date with the activity when you're looking at some of your competitors doing so well, but I also know like what they're- Planning to build with Nvidia with the DSS architecture, and I expect for more token production, and I expect for them to generate more per megawatt, and ultimately owning their infrastructure will, I think they're I think they have a better chance. I'll put it this way, if they're able to generate ten billion dollars of, annual recurring revenue, I have more confidence that they'll generate a profit than, say, CoreWeave this past quarter, who still has-- they had to add back their stock-based compensation just to show that they had adjusted operating profit. So as good as the news was for CoreWeave and Nebius, for that matter, like this is about making money. At the end of the day, and I know that they're both scaling and still very early in the industry, but I do think Iron at some point will have this moment where people understand the power of that vertical integration. But you had your hand up, Marcos, what, what'd you wanna say?
Marcus: Yeah, I wanted to start with your opening statement where you, talked, I think, about Microsoft and some other things. In your eyes, does it sound reactive or strategy? Because in my, in my ears, it sounds reactive on what's currently happening and what they're doing. Like I, I heard the case, of course from you guys. I own Iron also, by the way. I own White Fiber also because I really like the retrofit model and what they're doing. I will write something about it tomorrow, and I will Be speaking to, Michael Franceschi, if I pronounce it right. He's the v-Vice President of Cloud Services at Wi-Fi. we will probably have a call next week. but a lot of the bull statements were like that Wi-Fi piv- pivoted, or sorry, that iron pivoted early, right? they, they saw that the mining wasn't, wasn't the future, they, they secured the land, and they saw this whole, whole infra build coming. But All the actions after that, to me, feel very reactive on what's happening on the market, like, "Oh, we need a software layer." "Oh, we have this now sitting with, with the, with the air, with the air-cooled, side set horizon." Why aren't the air-cooled side set horizon not being fulfilled now for the immediate demand that Nebius is doing. I'm not advocating if one is better as another, but for me it always f-feels Nebius is straight on strategy from the beginning on. Of course they have the data center experience building from Yandex, it's not something you take away, but Nebius is acting more like a tech company where I feel that Iron Get that a little bit too late. They still act as a full AI infrastructure company while they should have pivoted and behaving more like tech at least. At the end of 2025 or half of 2025. Currently, Irena Management feels very reactive to me and like that the world is going open for them now and then. I get back to my, to my point, how in touch with the actual market are they? That's for me a big, big question now for current, current iron management, because it feels so reactive on what they're doing. Of course you have the long term strategy like, yeah, we're gonna get everything energized and, yeah, that's all nice, but currently now, when the iron is hot, you, you got to take profit of it. And currently with everybody being in constraint and wanting, some customers wanting that immediate compute, Iron could easily host that if they pivoted at least strategy-wise, let's say, a year ago And that's, that's my biggest doubt I currently have, have with Iron. It, it feels too, too reactive and too much asset focused on the longer term, not saying that it's bad. But I feel that execution-wise they dropped some balls, as especially this year. Curran, I'm curious on, on your take.
₿itcoin ₿utcher: Yeah, I don't think it's been perfect by any stretch. I think I would say I, I agree with you with the air cooled capacity. I had mentioned that earlier where I thought that was their quickest way to re-rate as a cloud by showing revenue quicker. But they are on track now with McKenzie, and we should see Prince George hit the financials this upcoming quarter, and I think it'll go somewhere from thirty-three million the prior quarter to as much as ninety this upcoming quarter, which It's not quite two point five billion by CoreWeave or, I'm not sure what Nebia's reported, but it's still progress for them as far as the, Horizon One, I think the main reason that, they had already shown the ability to do, or at least internally knew that they could do air cooled in Canada, but I think it was important for them, for building going forward, for them to sign a liquid cooled deal, not only to show that they could in the marketplace, but then also to be able to- Build that data center and iterate it multiple times, and everyone here is familiar with the delays with Horizon One, but, you know, our understanding is that Horizon two through four should be a lot faster after those growing pains, and I think, I think Dan will always point to the delivery of the GPUs to maximize and optimize the pricing, and there's truth to that, and even Nevious acknowledged that today in the call. So I think originally, I, I can't tell you what happened behind closed doors with Jensen, but for whatever reason, Prince George didn't go live as soon as everyone thought, and there were- At least a quarter or two of delays, and I believe that's fixed, and then ultimately they pivoted and teamed up with him. And my feeling, this is just speculation, is that a lot of the most recent hires are related to essentially Jensen or someone at Nvidia being in their ear saying, "Okay, you're gonna..." You know, we're gonna allocate you Vera Rubens, but we need you to service these sovereign entities or enterprises, and we need to focus on open source models so that we can distribute, you know, so that these enterprises can have their own unique, sovereign models that they can are proprietary and they can protect themselves. So this whole thing feels like That probably was Q4 or early Q1 where they decided to make that change, and now, you know, we're five or six months into it and it's an incomplete product, but I think Showing some revenue this upcoming, upcoming quarter is certainly important and, but just Dan speaking to it and like you have all these new hires, you know, what are you guys trying to build? What, what is the dream with the token factory? what were you
Marcus: gonna say, Marcos? Yeah, that I fully agree with you, that Iron is now making the right steps. yeah, like I said, it's not a hammer on Iron, it's, it's- Just a little bit later than I expected, and it strengthens a little bit of my speculation that they were out of touch with how the market was moving for a little bit of a too long time, let's say Hypothetically, if I would lead Iron, in the middle of 2025, I would earlier lay ear to Jensen To say, okay, what's, what's actually going on? How can we, how can we secure more GPUs? What do you think that the customers need? You have, you have the best view on the market probably from everyone. And start that progress, just much earlier. And when you t- hear them talk about demand, and correct me if I'm wrong, the only times when I hear them talk about demand, he, he just names the word demand. If you listen to Nebius or even some other companies, they break down demand in certain compo-compartmentalization. They talk about short-term demand, midterm demand, some chances here, some chances there, some chances. They, they feel for me more in touch with the market than Iron does, and I think with the current hires, and it's, it's of course in, in, in, in conversation with Jensen, they learned a bit more how to communicate with the market, how to- To level with the market, how to map demand, how to see how the market is gonna move, how the market wants to move, where the, where real short term versus long term demand is, et cetera, and name it all. But I never hear it, and I said, correct me if I'm wrong, I never really heard it from Dan himself, and that gives me A little bit of a feeling that they were out of touch with the market too long and focused on building their own product without essentially I wouldn't say stress testing, but giving a feeling like, "Is this what the market is needed? Is this where the market is going? how can we get the air-cooled part up? Maybe there's some immediate demand for that, et cetera." I think they're doing it now but that the realization came pretty late is something that gives me a little bit doubt for management how to go forward Forward. I hope that all the new hires, will complete the team and make them more in touch with the market. but yeah, they have to prove it at this point.
₿itcoin ₿utcher: Yeah, I mean, I think it's, I wanna let Mark speak to it, Mark, if you don't mind, there were some guys, Noel and RJ that are gonna go after that. I wanted to shift so that we can cover a few more, whether it's White Fiber or other companies or, small cap and not just make this, iron space. But so Mark, you got last thought on iron, and then we'll- Transition
Mark: here. you guys covered a lot of it, like five, ten minutes ago, you were starting to speak to some things that I was gonna say, you know, listen Nevis is executing very well. I think they had, they had, they certainly had more opportunities, to do some of the things that they've talked about on their call today. You know, remember, I mean, the The sites that, that Iron has, they're, they're all, you know, vertically integrated and all owned. They're all their own and they only had so much capacity. you already touched on it, Butcher, that You know, Coreweave and, Nebius, they, they, they had more capacity before Iron's capacity was available, and I agree with A lot of things that Marcus is saying there, and, everything that you said also, Butcher. you know, I mean, they're two different companies. They, they, they have two different-- They're gonna, they're gonna have two different paths. The total addressable market is one that is such that both are gonna be very successful. you know, there's been changes from Nevious. I, I've been following them just as long as, as Iron. and, you know, you hear things out of them that, that I wasn't hearing before. You know, they did, they came, they, they announced in July this asset light optionality. Okay, that was something different and new. you know, that's not something that they had mentioned before. Before, I, I believe Iron was talking more about delaying these contracts before anybody else was really taking that stance, because months and months and months ago, the market was, was on this kind of very simplistic instant reward of, "Oh, you signed a deal, here you go. Oh, you signed a deal, here you go. You know, our, our stock price is gonna, is gonna run." And, and listen, stock price Makes everybody feel so good. But remember, this is still one point in time. Today isn't gonna tell us who the winners are. I think they're both winners, and I don't, I'm not just speaking from this being just a, you know, an addendum to the normal Sunday night Iron Space. These companies are both gonna be winners, they're on different timelines, attacking the opportunities differently. But the mar-the market is there, the total addressable market is there. There are gonna be multiple winners, some may get consolidated. I think Nebius and Iron are the top two, and, I think there's, a lot to like with both companies. I think we'll start to hear more and more. A-again, there's the, the Roberts brothers, they have a, you know, and Dan, 'cause I've never, heard his brother speak, but, you know, there's, They just have a certain way that they are doing things, and that rubs people the wrong way sometimes. And again, point in time is paramount, perspective of the situation is paramount. It's easy to get anxious, it's easy to start pointing fingers, it's easy to say, "Oh my gosh, these guys are just clobbering iron and blah, blah, blah, blah, blah, blah, blah." Listen, both great companies, and, I know there's other guys that wanna speak about different companies than Iron and, and, Nebius, but congratulations to Nebius. I think, they're doing nicely, but again, they have some things to speak to also. They have some, you know, per- they have some, the build outs that still have to go well and some delays that are probably minor and maybe overblown by those that don't love Nebius. But, y-y-you know, at the end of the day, we're looking at- The growth of two fantastic companies, and, we don't have to be tribal about it.
₿itcoin ₿utcher: The only thing I'll add to wrap things up, Mark, and thanks for coming up, my concern with iron specifically is if there's not this, Sense of urgency going forward to communicate and start generating some of that shareholder value more immediately, what I think the problem is potentially is And we can speak to it after these white fiber guys have a chance to talk, Marcos, but I know there's the new capital pool from BlackRock, five hundred billion dollars with a few other independent underwriters, which I expect Iron to be the beneficiary of. I think Bank of America came out with Two hundred fifty billion dollars, but if there are holes in their repertoire, they're at a tough position right now where they did acquire Morantis, and I expect that to pay dividends, but when Nevious or- SpaceX with over a trillion dollar market cap, they can just simply go to market and use their shares as currency and address all of their needs, and that's something that I just Hope we see a little more progress here sooner than later so that Iron doesn't fall too far behind. Let's go to RJ and then Noel and, Austrian, they wanted to talk about, these are some guys I've had the chance to speak with the last few days about what White Fiber was working on, and I appreciate, that community welcoming me in to learn more about it, and, so RJ, why don't you kick it off?
RJ: Thanks a lot.
₿itcoin ₿utcher: so I was
RJ: just to kinda preface this, I was, luckily an early buyer of Iron, with the power thesis. I think that's moved along now. I, I believe that the power's not going to be enough, as it was in the Early or the late part of last year. one of the reasons I pivoted to White Fiber was because of the experience of the, of the, team, that they have, you know, fifteen, twenty years experience running these type of Tier three data centers. and, and you can see that just in the earnings call today, just the, the cloud adoption, even though it's a small scale, you know, I don't believe that they'll ever get to the same type of level of Zenibius or CoreWeave, and you don't need to, you know, to make a lot of money on the stock Right? But I, I do think Marcos hit on something, and I'll be brief because there's people that are behind me that are much more what would consider, financial auditors than me. You're gonna have two splits. You're gonna have tech companies that know how to run data centers, and then you're gonna have real estate companies that just build data centers. And I don't think you're-- I don't think the market, I think markets kind of splitting that right now I think your CEFER, obviously, are just, are, are gonna be like the real estate plays, but the value of their power contracts are going to-- they're not gonna get the same multiples they were getting at the end of twenty twenty-five. I, I believe that the multiples are gonna come from the people that have been running data centers for twenty years. small industry, very niche industry Very extremely, what you would consider like everybody knows everybody industry. The, the seats in those conferences aren't big. So when you have people that have been working with Google and Amazon and Microsoft for fifteen years on data centers You know, and then you look at someone like White Fiber, who bo-- goes out and buys that company, who has a track record going back into the early two thousands. you, you can't help but ignore that some of these companies are gonna become tech companies, and some of them are gonna remain industrial infrastructure plays. Now, as a shareholder, you just wanna go to the one that can make you the most money. So I don't, I, I wish I was a lot more flexible to the nebulous thesis in January instead of Being very cautious with iron. But I'm not gonna make that mistake again. and it doesn't mean iron's not gonna go up to four hundred. It doesn't mean that. It just means that There's, it, it just means that obviously the market is rewarding the tech side more than the industrial side. And that's my take on the industry, as far as like, you know, there's two guys are gonna speak behind me that can be a lot more thorough about why fiber itself, but you got five income sources with fiber. You got the colocation, you got the cloud services, right? You got the, management hire for management of your data center. So you have a lot more-- There's two more I, oh, tell me ahead. You have a lot more flexibility, and I do believe the industry is gonna require a lot of flexibility. I don't think concrete's gonna get cheaper. I don't think crane rentals are gonna get cheaper. I really don't think a lot of electricians will live in Sweetwater, Texas, when they can go live in a different area. Right? I, I think you're gonna have a hard time pulling labor to these remote places. Because there's a, there's maybe a little bit better opportunity that pays more money in more what you would consider metropolitan places, and that's what I love about the retro. So like, you know, the North Carolina campus And Madison, you know, you're on the East Coast. You have how many electrical unions going down the East Coast? Plenty. Y-y-y-you're not gonna have a shortage of labor there. I don't think you're gonna be able to draw all the labor to these remote sites. I, I don't think so. I think there's gonna be a lot of bottlenecks that are gonna appear in the next two years But anyway, I, I would love for you guys to talk to Austrian. He's kind of like the go-to financial guy, so I don't wanna put any pressure on him, but if we could hear him, 'cause I know he's busy, that would be great
₿itcoin ₿utcher: Marco, if you could keep it quick, and then we could go to Austrian and then Noel. I would say, or it looks, or RJ's still on, I, there's really no evidence of the labor shortage in Sweetwater at, like, they have 2, 000 people on site, so I- I just have to-- we can talk about the faults of iron all night, and I'm pretty well versed in them, but they're, they're not having a problem sourcing and staffing the sites.
RJ: Not
₿itcoin ₿utcher: yet.
RJ: But that's what my point is, Butch, is when you're the first one to the job site, you have the advantage, but Iron's no longer the first one. This industry's picking up. People are, people are putting up more union halls every day, and, and the reality of it is, it's a, it's a gigantic mess. Yeah, but if I'm, I'm sorry. Yeah. Anyway, I'd like for Austrian to go, if you don't mind.
₿itcoin ₿utcher: Just one last thought on that with, and then Marcos wanted to respond, then Austrians in Europe, but, If I'm a construction worker or electrician, and my job is to secure labor for the next few years, I'm probably gonna go to a larger site. And I, I'm not doubting that White Fiber can build out their sites, but if I have a hundred megawatts or a gigawatt as opposed to ten or twenty megawatts, I just I think that's more predictable work for them, and it makes sense for them, and there's been no evidence to suggest that they can't step up. Data centers aren't
RJ: the only-- Data centers are not the only electrical jobs hiring, at all. That is a very, niche job in itself. My whole point is, is that if you're drawing all your labor Basically, from, if you're drawing your labor in from out of town, you're drawing your labor, there's not two thousand electricians that are from Sweetwater, Texas That's all I'm saying. that's all I'm trying to say, that's all I'm trying to say. I'm not trying to say that you're gonna make money.
₿itcoin ₿utcher: Yeah, I'm, I'm acknowledging that, and you've had, I mean, Patrick Flurry said they're sourcing electricians from my hometown of Detroit, so like it's, it's industry-wide, but I, I just, my point is I think larger jobs provide more job security for those guys, but I don't wanna focus on that too much. Marcos, quick response if you don't
Marcus: Yeah, quick response. on what RJ said, I of course have Mark in my team, who works 15 years as a data center project manager and designer. we talked about a lot about, the industrial versus, let's say, data center tech. You can have data center experience, but the last twenty years data centers were barely innovative, and there's currently a big shift going on in people who can pick up on the pace. that the market currently is asking, and people will get a little bit more stuck in the, in the industrial side. And to add on agility, further and being proactive, I think Yensen is the prime example that doesn't even matter how big your company is, that agility matters. Yensen is, is agile on everything, if it's supply, if it's now arranging, the financing round so that essentially companies like I do and the other ones, everybody, can get access to money Easier without having to use the hyperscaler credit, so the high potential customers that I'm talking about, they can finance way easier, and that's a huge trend. And then talking about, management in Central, that, what Mark said, that Iron will be successful, I think they will be successful also, and that management is focused long term. I think good management is mostly, Stress tested in a highly, changeable market where every day something new happens and, and, shows up. And I think currently that Nevis is showing that very well, how agile you need to be to keep up with market developments to get the best e-economics out of your business model. That was my addition.
₿itcoin ₿utcher: Let's go to Austrian. Austrian, are you London based, was it, or thanks for coming on?
Austrian: Yeah, I'm in England. Fortunately, I'm a, I'm nocturnal, so this isn't too bad for me, this is quite natural. I think something that you and Marcus have really struck upon, which is really good, is strategy. So when I was first investigating data centers, the big thing that stood out to me was electrical infrastructure, right? The, the replacement costs The, the amount that it costs as a component per megawatt, the delays and stuff like that, and that's why I've been very, very drawn into Terroff, obviously, 'cause they have this focus on free, you know, this electrical infrastructure, so they haven't got to build as much, they have more redundancy, they have lower costs, and the costs really is much, a much bigger deal on the yield than really most of the revenue, to be honest. And then When I look at like Iran, I see a company that has been permanently just unable to make any long-term decisions properly, and I think, you know, you were talking at one point that it seems like there's a lot going on under, a lot like behind the hood Of Iran, and that, yeah, that's been the case for years, right? So at first it was, you know, they were spending all their money on, Bitcoin mining, and they got a lot out of that at first, but a lot of other companies were developing data centers a lot quicker And then they said they were gonna have six, seven, eight million per megawatt bill costs, and then it blew up to about fourteen to sixteen million out of nowhere because they obvious, obviously the site didn't have the pre- pre- the electrical infrastructure that, you know, they thought they, they'd basically, in my opinion, misled investors that they'd bought a lot more electrical infrastructure than they thought. So to me, these delays have been entirely predictable for over a year And it, it's something that I think they've gotten to a better point now with the dilu-dilution slowdown, and I think that it could get better, but I definitely don't trust the management. But I, I haven't got much time, so going onto White Fiber now a little bit, just a rush. I think White, White Fiber is brilliant because their strategy's been consistent. I think they've shown the best of that. I think they're really agile like Nevious. So like, obviously the retrofit model, the time to market, if you can get a data center Client, it's gonna have, and then that's gonna transfer through to the leverage on your side as well, right? The ability to use these old, you know, warehouses and whatever, it's a lot better on the environmental side and the, legislation side, which we're seeing is far more significant as time's going on. And then on top of that, you've got not just the scale, but the scale of the builder and how it transmits into share price, right? So if you look at like what a hundred IT megawatts does for white fiber, it's nowhere near the same for Terawal for I- or for Iran. I, I can give the calculations on that, but, you know, forty megawatts IT load for NC one That alone is probably gonna be worth about twenty-five dollars a share, right? So if you think that they can, they-- we're looking right now at them adding an extra hundred, eighty to a hundred and eighty megawatts a year and And their cloud, they've just added three hundred and fifty million in cloud, no, sorry, five hundred and fifty million in cloud contracts, right? And that's for what market cap? Like a billion market cap? So a, a couple years of a few hundred megawatts being built and the cloud, it's the only company I can see here which is successful three, you know, three, four, five x, right? You've got the companies that are already established platforms like Hoot, like Wolf, like Cipher, they've had the financing, they've had the big contracts, you're pricing in some amount of contracted revenue or some amount of guidance when the market goes up and down, and then you've got the companies like Fermi, then you've got the companies like White Fiber, right? Or even established, and I think the risk reward is actually dramatically in favor of the companies that need the catalyst to establish themselves. But if, I don't know where you wanna start with that, but I haven't got too much time.
₿itcoin ₿utcher: Let me ask you, financing in particular, I know there was a loan from, BTBT, which is the parent, you know, owns seventy percent of the equity, and that's kind of a lower cost form of capital, and then I think I read something from one of the guys today saying that there was a change in the CFO. I think given-- I think you would agree that if they're gonna build out hundreds of megawatts of cloud per year, that a lot of that's gonna- Gonna be predicated on the ability, there are prepayments certainly from the customers, but they have to be able to raise financing. what are they doing to improve that, that you see right now?
Austrian: That's a brilliant question. It's a brilliant question for a couple of reasons. On the cloud side, they're not even buying the GPUs in these new contracts. They're literally being paid. They're gonna rent out part of someone else's data center, margins, blah, blah, blah, blah. But they, they're literally don't, they're not even paying for the new GPUs Expertise to manage the GPUs, as they said in the earnings calls today, which is like, obviously, you know, when the denom- when the denominator is that small, you know, what, what really are the margins, right? And then there has been some issues recently with the financing for NC1. They've had to basically use, they've used bridge financing to get it over the line because if they were to accept a large financing deal pre-revenue generation, it would have been a larger interest rate. So they've calculated using, using the bridge interest To then get to revenue generation, to de-risk it, to then get a much lot, to then get a better interest rate on a much larger, on a much larger total amount, and then to obviously pull that equity out and then obviously recycle it and stop the flywheel. So really what I don't, I think that they've, they've picked perfectly the type of cap, the cloud contracts they want. They haven't rushed in and tried to compete on price like Hyranda too early, a little bit in my opinion, at the wrong time. And they've picked them really specifically and carefully, Waiting for this, first of all, this big debt agreement on NC1, and then the revenue from cloud with almost no CapEx, and then the debt pulled out of NC1, the equity pulled out of NC1, to then recycle it into a new site they should have soon. That's where the flywheel should begin to kick. The next, the next six to nine months, it becomes almost like another platform.
₿itcoin ₿utcher: Well, thanks for joining us from England and making time with the time zone and, yeah, I, I haven't had a chance to listen to the call yet. I do think the management piece is interesting given, there's such a need for compute that If you can somehow source the GPUs, but you've never run them before, I, I can understand why, at least temporarily, why there's value to their, we'll say consulting services, if you will. I think Marcos had a response maybe while you're still on, but otherwise, thanks for coming up, Austrian.
Austrian: Yeah, thank you very much.
Marcus: Yeah, I just a closing general, message, Bitcoin. Of, butcher sorry. so for everybody listening, I will, I have a contact moment tomorrow with Michael Francisco, the vice president of, Cloud at White Fiber to schedule a meeting for next week, and I also talked with Butcher about hosting a space with Mark from my team, like I said, who has been building data centers of, who is a project manager for over fifteen years in building and designing data centers for Google, for AWS, and multiple, and we gonna do I think in a couple of weeks, Butch and I will, will, will announce it. We're gonna do a space and bring him on so all you guys can, ask question to somebody who's really experienced in data center building, how it goes from modular to eight hundred full DC retrofit, all these kind of things. So you will, be hearing from Ian Butcher, on the short term.
₿itcoin ₿utcher: All right, well, thanks for joining us, Marcos and Osterin. You have any closing thoughts or, if you can stay around, we'd love to have you, but I understand that, it's pretty late over there.
Austrian: Yeah, I mean, the only kind of closing thoughts I'd have is just a little bit more sophistication on the retail side. It's very easy to pay attention to things like headline energy, headline revenue, right? It's easy to get warped in by what the large Things through a per share analysis, right? Like you can say that Iran's payback period is two and a half years, but there's a difference between payback on project and payback on equity, right? That they're actually very different things, especially when you account for things like dilution. you know, looking at levered and unlevered returns, I think we also need to look as a sector at how much diversification there really is. You know, we all, we're, we're, we're here analyzing these specific companies and who's better and who's worse, but All big AI company fails, we're all gonna sink through the floor, and do you wanna be there for another fifty percent drawdown, right? So I, I'd encourage people to broaden their horizons to macroeconomics and stuff, and, you know, be a lot more flexible viewing the sector as one. Which I think, I think you-- which I think is really good. I think that's what you've been doing, focusing on Core, even Nevious, et cetera, et cetera. I think we're moving in that direction. But yeah, that's my,
₿itcoin ₿utcher: Alright, talk soon, my friend. Thanks for joining. Let's go to Jeff Ward.
Jeff Ward: Hey, I just wanted to talk about skilled trades for a second. there is- A, a demand for skilled trades and labor in the US for sure. But we saw this with the oil fields in West Texas and, in the Bakken up in North Dakota. They deal with this in Canada. They throw money at the problem, and it works every time. We need excavators, electricians, welders, right, structural guys to put projects up. those are small communities of guys, they know where the money is. They don't move to Childress, they don't move to Sweetwater, they leave their families back in Indiana and Michigan, wherever they're from, and they go there and they work their ass off Several months at a time and don't spend a lot of time at home. And a lot of other guys will come out of retirement, called by other friends, running those jobs just to get them done. You end up-- it's very easy to fill those, those jobs. Once those subcontractors working for Iron Do good work, they're gonna get called to work on the next job, and all the other crews get the time off when their part's done, and they get told, "Hey, we'll need you back in three months." Those guys literally just like crab fishermen in Alaska, right? There's not, it's like, "Oh, where are we gonna find more guys to go crabbing in Alaska because it's a hard job?" Well, you know, guys with like raging drug habits Who are really good at fishing, you know, and just terrible with managing their personal life, run up there and fish nine months out of the year and make three or four hundred thousand dollars. Well, it's no different with welders or guys that run heavy equipment, you know, their personal lives may be in wreckage, but they're able to fund that over the course of an entire lifetime by the fact they're really good at their job and they stay sober while they do it. So they work safe, they do excellent work, and they're happy to move equipment from wherever they are in the US to wherever Is and grind on that job. It makes the guy, the Indian guy that runs the, you know, local hotel really happy 'cause he's written out those rooms forever. And so like all those oil field memes, if you were in, oil and gas, all the oil field memes about the Indian guy in North Dakota wearing all the gold jewelry 'cause he's, he's so happy about the, the, you know, the new oil wells getting drilled in his area. I mean, all that kind of rings true here. The sk-- There's, there's no shortage of skilled labor in Now, if you think the, the, the bias is real, th-that the gentleman was, was speaking, he, he's not the only person that thinks that way, which is why when you're in North Carolina and you bid your jobs out and you don't pay as much 'cause you assume that people wanna live here in North Carolina and they don't wanna live in West Texas, what you don't understand is that guy's coming from like Northern Maine, he's not moving his family, and he's gonna go to where the money is, and so s-simply throwing money at the problem actually To skilled labor. The oil field figured this out in the eighties, in the seventies, in, in Texas, and that's how they fixed their problems. They throw money at it. So downhole welders that can, you know, that are certified to, to seal off wells, you know, those guys can make thirty grand in a day. It's, it's so funny, people don't understand that, like, once a guy figures out that's what he can do, he doesn't walk away from that job. He does a really good job, but he makes himself available. And so, those guys are, are around and they can fix your problem. The, the issue is, who's really building and who's not? Who's already got that power and who's not? So, I'm, I'm not worried about the, a shortage of skilled, skilled labor at all. I mean, peo- you I show up at trucks and build amazing things, and, never short America. Yeah, there's, there's not as many young guys doing it, but, you know, the K-shaped economy continues, just drives more younger guys into the trades. So I, I know, I see more younger guys getting into trades now than I did five years ago. Five years, and it
RJ: takes almost ten to work on data centers. Jeff, my- Sure, yeah, yeah. They got an apprentice, but
Jeff Ward: those crews are there. They're bringing in the younger guys and they're teaching them,
RJ: Metro area, an electric foreman in Washington, DC, working on a hospital making ninety-five dollars an hour straight time. Okay. And the Washington, DC metropolitan area has, more work Than electricians, and we're not even talking about all the data centers in Northern Virginia. Now, my, my, you made some fantastic points. Where there's demand, supply will show up. That's just business one on one. And you use the oil fields as an example. Well, I, I think that's an unfair example, and here's why. The reason I think it's a very-- The reason I think it's a very fair, not a fair example is because there's not oil fields between New York and North Carolina. Between New York and North Carolina, the world is the brightest on the, on the East Coast, on any map that you see at night All the electricity is with, all the electricity is the east side of the country. This is the most-- the, this is the biggest grid, this is the most precious location. These are location-sensitive data centers I, I, and I truly do believe location is gonna matter where your data center is. That, that's my personal opinion. So do I think--
Jeff Ward: I, I agree with that. I agree with that. But in, in, in construct-- in, in, in the trades, there's, there's two worlds in the trades. There's indoor world and the, and outdoor world. So there's construction and then there's maintenance, right? I'm
RJ: speaking
Jeff Ward: strictly-- Construction always-- Strict electricians. And, and, and, okay. Yeah, so same with electricians, whether it's Maintenance electricians would work at the data center, the construction guys would be building it. Construction always pays two to three times more than maintenance, and so it's, it, it, it doesn't take much to get young guys to just move for the money temporarily. But those
RJ: young guys aren't, aren't even, I mean,
Jeff Ward: they're forties. Well, I'm just saying, yeah, young guys in their forties. I know
RJ: electricians that are ten years in the career and they weren't allowed to work on data centers.
Jeff Ward: Well, yeah, but there's crews there of old guys that know what they're doing, that are still apprenticing guys while they're doing this build out. And the guy-- and, and from what I understand about the data centers in Texas where I'm pretty plugged in, on, from a different angle, a lot of the guys that do this build out, especially in electromechanical, get headhunted to stay on with that facility to do the maintenance. And, and, and, and that's when they decide to move or not move, and sometimes, sometimes it's hard to find the guy to stay on because he makes more money building this.
RJ: So within, within New York and North Carolina, there's gonna be a lot of-- there's gonna be a lot of data centers built That, that's the truth. Okay. Yeah,
Jeff Ward: agreed, agreed, hundred percent. Yeah. And, and latency's an issue and location matters, yeah. Absolutely. And, and if they're gonna want a guy to stop chasing construction money, they're gonna have to pay more money. The, the issue isn't whether those guys exist, it's what, what you're gonna pay for 'em. Whoever pays more is gonna win.
RJ: Somewhat. Yeah, I don't disagree with that. Right now, on the white fiber project, the union electricians are making forty-two an hour, straight time
Jeff Ward: Yeah, and that's, and, you know, but in West Texas, that's slave wages, you know, 'cause you can throw a chain on an old Kelly rig, which is like way out of date and not OSHA certified, and double that.
RJ: Well, we're not talking about-- I, I'm just trying to say that When Iron-- Iron has first mover advantage, maybe Iron's not gonna be affected by this as much as some of these other companies that start trying to bid for the union labor
Jeff Ward: Okay, yeah, hundred percent, I agree.
RJ: Okay. Yeah,
Jeff Ward: absolutely. Yeah, the, the unions have, have cards to play in certain locations, but yeah, and, and, and that, and that's very, that's very realistic. I don't think anybody in Texas is facing that issue though. It's, it's an at-will state. That doesn't mean unions don't operate there, they absolutely do. Like, pipeliners, when you're doing midstream pipe, if you're trying to connect gas- Are
RJ: there data centers down there?
Jeff Ward: I don't know whether it's union or not on the electrician side. I know the welding side and the excavation side really well, and some of them, some of those guys are union and some of them aren't. Butcher, do you know? They don't really care when they're in Texas.
RJ: That's crazy. Butcher, do you know if those guys are union or non-union workers down there?
₿itcoin ₿utcher: I don't at this time, no. Okay.
Jeff Ward: Well, I would assume that they're IBEW because that's just the, the, the whole electrician trade tends to roll that way. Yeah, and if Irons is a non-union, it's shop to shop. but the, the, the, the, the whole con-- the whole perception of union labor in Texas is very different than it is in the East Coast. Yeah, but all the-- And a lot, a lot of companies in Texas won't hire union labor because they don't wanna deal with the BS, they don't wanna pay the job agent in five points,
RJ: they don't wanna pay him a pension, they don't wanna pay him health insurance, I get all that.
Jeff Ward: Now Yeah, yeah, that's-- and the oil field work the same way. They, they, they don't have all those benefits. But, you know, a-- but literally, a, a guy can walk out of high school with a strong back and, and thick skin, and he can go to the oil field and clear six figures immediately. You can't,
RJ: you can't do that in New York City, right? There's no oil field. So, but
Jeff Ward: yeah. Well, you, that's, that's right, yeah. But, but the guys, the, the guys that want the opportunity, they, they run that direction, and the, and the guys that are retired, that are teaching in trade schools and community colleges, feed work from those recent graduates into those places. And, and so it doesn't, it's, it's not, it's not a static, like the, the, in the East Coast, the, the trades are pretty static with the location. Where you're right, a guy's not gonna leave his home in Boston to go work in Northern Virginia. But the guys out west have a way different mentality. They'll go anywhere. They just want, they have certain standards for, for their pay and for their, benefits, and as long as you-- Whoever pays that wins. And, and the guys that pay enough get to choose In
RJ: the next eighteen months, the demand for electricians are going to increase. We agree to that? Okay.
Jeff Ward: Oh yeah, a hundred percent. Yeah. The, the re- the real bottleneck there in the trades is electromechanical.
RJ: We believe.
Jeff Ward: This, this, this- We
RJ: believe.
Jeff Ward: Yeah.
RJ: That when these people- Can make ninety, you know, seventy-five dollars an hour plus double time overtime, and they're doing, you know, data centers. Yeah.
Jeff Ward: I, I think those numbers are low though, because like master, a, a master, a, a master electrician. Yeah, but a master electrician out west is, is, is double that, i-i-i minimum. He probably wouldn't even answer his phone for a hundred dollars an hour. I'm not talking
RJ: about, I'm, I'm, I'm not, I'm not, I'm not being like the care package. I'm just
Jeff Ward: Well, yeah, no, no, so then, that's the problem with the, that the guys out west have with the unions and why you don't see penetration into the labor market, is because they don't wanna pay the union dues to get those benefits. They'd rather just make a hundred and eighty an hour and figure out how to buy their own health insurance.
RJ: Yeah, yeah. And that's what they do. And they don't have to, you know, ninety plus another, you know, fifty dollars on top of that an hour, and they never have to, they never have to
Jeff Ward: Yeah, that's it, but, but I'm just saying, in the labor market, there's, there's diff- there's different, cultures. I don't
RJ: see any way that these data centers are gonna build billion-dollar contracts without union work. I don't think this is gonna be non- Well, out
Jeff Ward: west, it's absolutely not a problem.
RJ: So in California,
Jeff Ward: it's abs- they, they don't need the labor unions out west to build. And they, they never have, and, and they never will. That, but that doesn't mean unions don't participate.
RJ: Okay, we'll have a question. How many data centers are west of the Mississippi?
Jeff Ward: Dude, I would just encourage you to just drive to Texas.
RJ: I know how many data centers are in Northern Virginia. Hey, Jeff
₿itcoin ₿utcher: and RJ, like, I, I don't wanna kinda switch topics, if that's alright. But don't think
RJ: about that question. Yeah, I'm
Jeff Ward: good, I'm good, I'm just, back in the blue collar boy. Yeah, I've,
RJ: I've been in construction my whole life. The question is, how many data centers are west of the Mississippi?
Jeff Ward: I have no idea. I, I never bothered to count em. But I, I know everything getting built in Texas gets built. That's all I'm saying, it gets built and they don't need unions to do it.
₿itcoin ₿utcher: Guys, I appreciate both of you, but I'd like to switch. Mark, you were up next. Guys, thanks for going on mute. Mark, what do you got? And then, Sean's gonna come up.
Mark: Oh, I, I, I just wanted to get back in on the, speaker panel, but, I don't have anything at the moment.
₿itcoin ₿utcher: Okay, let's go to Sean just joined and, Sean wanted to change topic. Sean, what's going on this evening?
Sean: Hey, Bitcoin Butcher. Thanks for hosting the space.
₿itcoin ₿utcher: Yeah,
Sean: yeah. Yeah, just, just I don't know if
₿itcoin ₿utcher: you're in anyone else you wanted to talk about.
Sean: Yeah, absolutely. First of all, I appreciate you, putting on these spaces. I, I've been a shareholder since last July, and I followed all the pro- Progress that the company's made, and, it's been incredibly impressive. I just can't believe that we spent all this time talking about electricians when You know, the Microsoft deal is so imminent, and there's so many exciting things on the horizon. You know, I wanna focus on those kind of details.
₿itcoin ₿utcher: Well, I think there were, Even unrelated to iron, I think what is-- so they were talking about New York specifically in the markets, and I do think like after-- then Sean, if you don't mind, if you can go on mute while people are speaking, that helps. Thanks. I do think there's a greater theme at play where We went into exhaustive detail with Jeff and RJ on labor, and I, that is gonna be a constraint going forward, and that's definitely a dynamic. But what I would say is with respect to like ERCOT batch process or the New York moratorium, that I think the most interesting thing that White Fiber has going for it, or that TerraWolf has going for it, is this idea of brownfield development as opposed to greenfield development. Where you're going into, if you're repurposing an existing industrial site and already tapping into, power that was already allocated instead of making a new request, and if you're able to remediate the land and it's more environmentally friendly, which plays well to politicians, and then the next piece being the, with Wolf specifically, their idea that they can do on-site generation, which kinda- And it ties into behind the meter as a theme and whether you own, you know, Cipher spoken to behind the meter, NUA is kind of more of a pure play, Saluna, Fermi, like those dynamics are also at play. So I, I'm most interested with the electricians, like Where are they gonna be working is a good question, but just who can get to market the fastest is kind of the core question that we need to figure out and the states that define their rules more, You know, quickly and more, definitively will actually draw the most economic activity, which I think will be Texas, as it already was, but they just had to clean up their grid approvals. So just, that's kind of, industry wide, that's what I'm looking at, and as far as compute demands, who's gonna be able to incorporate? I just, it's-- we're so early with retail usage or consumer usage, I should say, we're, it's a few percent, market penetration where Once enterprises start actually using this, and then once instead of using, language learning models and the transition to audio and visual, like I have a buddy with a startup back in Detroit that, It's, I believe they train nurses and instead of using sample patients like live human beings, they're actually using AI bots now with certain, you know, symptoms, and then they describe it to the person, you're able to train. So like, there are so many ways that this technology can be used, and I think the biggest tell right now is just now that You know, what is Elon gonna do with SpaceX entering and actually focusing on this, and certainly the hyperscalers are already focusing on it, So it's just, what a great time and place to be in, and all the themes that are changing daily, and we could host a space every night if we wanted, like the, the news cycle is It's not like, you know, watching Colin Cowherd trying to cover sports in the summer and he starts talking about his favorite movies. Like, there is something new going on every day, twenty-four seven throughout the year, and that's what makes us- Space special. I, Noel was up earlier, he got dropped off, I think he wanted to mention something on White Fiber, but Noel, you have other holdings outside of Iron, if there are any other companies you wanted to speak to, like I saw Bitcoin AI guy in here, and I know he's had a- Spaced recently on Bitdeer, and maybe he could speak to their recent colocation lease in, I believe it was Europe with, I think it was Anthropic, but just there's, there's so much going on, and I'm one guy who covers only so many companies, and I, I try and catch headlines and, and ask the right questions, but it's a lot for, one person to handle, and that's the beauty of this, is we got two hundred people in here. So, Noel, why don't you take a shot at it?
Noel: And then we'll go to Bitcoin AI guy. Yeah, I'll be quick here, a bit of background. I'm an Irish guy, been in, I've been in America thirty years or so, live in California now. So I only really started getting into the Bitcoin miners maybe two years ago, year and a half ago. invested in Irys, yes, CipherWolf and Wi-Fi. Mainly, I still hold all of them. I just think WiFi doesn't get enough, press, I guess. no one's really speaking about them. We all know about Cipher and Wolf and Iron, they're everywhere, but WiFi is just like a little one billion dollar company that has colocation, that has cloud, that has- Expertise that has this new redwood, technology that can connect different data centers. So Do you mind asking,
₿itcoin ₿utcher: I was gonna ask you a question, I'm sorry to interrupt. no, go ahead. I think they have a unique market approach which I wanted to hear, since I'm newer to becoming familiar with them. Not many companies have shown If any that I can think of, but I originally thought like Iron, as an example, might be a hybrid model where they would feature a little colo and then do some cloud. What, if you were to ask Sam, their CEO, what, how do they dis-distinguish which sites are colo versus which are cloud, and what's their strategic reasoning for that? 'Cause I do think that's something that might be, you might see that from some of these smaller Cloud players going forward.
Noel: It seems like their main focus was on colocation, that's the Enigma, and the company that they bought the cloud has been a bit of a surprise, to us all actually. They, they bought five thousand GPUs, I think, there two or three years ago they have a place in Iceland that they rented out, and they've, yeah, three places in Montreal, but I think it sounds like the cloud is more, as Sam keeps saying They'll do whatever customers ask them to do, so we don't really know. And when they mentioned, you know, three new cloud deals today during the earnings call, we're all saying, "What?" Because he, you know, he doesn't really, I guess he's not like the other CEOs, he doesn't kind of blast all the information out. It, it seems like, you know, they're working behind the scene, so we really don't know. But the main focus, I think, is, colocation, what they- But they do own a lot of GPUs, they, they, you know, they put GPUs in, in, in third-party facilities like in Paris And I stand also, and they're expanding, they're, they're-- again, they're small, they, they, one billion market cap, thirty-eight million shares, twenty-seven million of those shares is actually owned by BTPT. And then an extra, a ten billion is owned by institutions, so there's not a lot of shares left for retail. And I guess all I'm saying is, why not, diversify? Why go hundred percent in iron when Stuff could go wrong there. Again, I own iron and I expect it to go to a hundred dollars or two hundred dollars, but if not, why not, diversify into wall for WiFi? Wi-Fi, again, very small, so they might be explosive next year, they might be a five bi- five billion dollar market cap. We don't know, but they do have a lot going for them. They seem to keep everything quiet, and they might announce a deal tomorrow that we don't know about, right? So, Well,
₿itcoin ₿utcher: thanks for coming up, I appreciate, there's been a few guys that have- Spoken that, I think it's fair to say a few hundred people that might have not heard of it, or at least known about it as much, have experienced at least a flavor for it tonight. So it's, appreciate guys like you coming up in Austrian and RJ, if you don't mind, we're gonna transition to Bitcoin here. Yeah, and just, just
Noel: what, what else we're gonna say? Just appreciate the opportunity, I follow all you guys too, so again, we're- And we're all cheering for each other, you know, cheering for ex- Bitcoin miners, and we're cheering for the neo clouds now, so we're, I think we'll all win, so that's, that's all I gotta say, but, but, but thanks again
₿itcoin ₿utcher: Yeah, thanks for coming up. Bitcoin AI guy, how are you this evening?
BitcoinAIGuy: Hey, just more color on BitTorrent. I'm, I'm actually like, I was a huge bear, right, for years. But they're on the top of my list, right? For bear market, Bitcoin bear market, ads. And I, I've been very, very critical on the management team. I, I still don't fully trust them. you know, and, and they're, the startup that they got, you know, it's a startup, right? They're not a hyperscaler. but the reason I'm doing this is because I, I think Bitcoin people have, people have abandoned Bitcoin and crypto, right? So I'm just trying to be, right, like just greedy when other people are fearful, and I'm just, accumulating Bitcoin and crypto equities, right now, and I think the thesis is like if they have AI exposure via Power, I think it's a no-brainer. no, okay, we'll, we'll talk about, white, white fiber. I mean, I'm looking at Bit Digital again, right? Like, not, not just because of white fiber, but because at, at least I think in a few years, Ethereum We'll have an opportunity to, to run, right? So I, I think, you know, don't, don't forget your roots, right? If you-- We all made a ton of money so far, w-with Bitcoin and Bitcoin miners and- all that, but look at things that, you know, are underperform- I mean, I, dude, I even looked at Marathon today, because the sentiment has gotten so bad, like one of the, the Mara pigs you know, fully capitulate, sold, sold all the shares after like three, four years of underperformance. like, I, I'm not here just to make friends, right? I, I'm here to- outperform. And yes, I'm, I'm gonna, be here for Iron's next 10x. It's, it's, it's unchanged, like number one position by far. I don't think anything else will come close to it. you know, I want, I want Iron to be a thousand dollar stock, right? I-- maybe I'll hold it long enough for it to pay dividends in the future, right? Maybe, I don't know. but, you know, I, I wanna do that again. I wanna find the next, you know, ten, twenty, forty X And even if it's a one percent position, right, like the size of a call option, I, I, I think that, approach could pay off, right? you know, and, it, it, the, the, the, the first, right? Like the first ad, it could be, the next one could be something, something else. but I'm not a, I'm not a Bitcoin expert, by any means, right? I, I just think they have different things going for them, and, the one, you know, obviously power, right? Colocation. They've got a three gigawatt, pipeline, they've got seventeen hundred megawatts operating. They're the largest Bitcoin miner, public miner by hash rate, they've got, you know, NeoCloud business that's ramping, they have a chip business, Bitcoin ASIC, design business I'm bullish on Bitcoin still, right? you know, I, I don't really hear Bitcoin too much on these spaces, obviously 'cause, 'cause iron is shedding. i-i-it's Bitcoin exposure, it's, it's brilliant for Iron, right? But I'm still a Bitcoin bull, right? And I'm looking at my portfolio and saying, hey, I, I have less- Bitcoin exposure because of my largest position is iron is just dominating, right? And, you know, I, I have different types of portfolios and retirement accounts and, i-it needs more Bitcoin exposure just, just because of what Iron is doing, right? And I'm o-well overweight Iron, So I'm not saying this rotation is gonna happen, right, from iron to Bitcoin, I'm not trying to steal anyone. I, I, I just, I just want to have, more, Bitcoin exposure, and I still think the demand for AI compute and AI, power is growing up. I mean, we, I, I, I saw, I read clips and bits and, pieces from the Neveus call and report, and, and, and the rates keep getting better, right? Twenty million dollars a megawatt. I, I, you know, can we see forty in the future? Maybe, right? that just de-risks, like- The story for, for Iron and, everyone else, right? And, you know, I'm, I'm just looking at these other opportunities in the single digits, right? Like, who would have thought? That, you know, this far, we're, we're not even like that far in the AI cycle, but who would have thought we'd see single-digit, stocks with, with companies that have gigawatts? Right? you know, we saw iron with the deep sea crash go down to five dollars. That-- was it really worth five dollars? I, I don't think so. but- The algorithms in Wall Street brought the stock down, that's, you know, conspiracy theory, you don't have to believe that, the price was, was five dollars, right? could we see a similar magnitude run with, with some of the other? companies, they're no iron. I'm not, I'm not saying that, but could some of these stocks do a ten X in a year, two years? Of course, right? We've seen, we've seen that type of run before, and the demand for AI is only going to increase, right? So, so that, that's how I'm thinking as, as an investor, And, you know, I'm not trying to short, sorry, I'm not trying to time these short-term trades. My, my plan is to, you know, if I, if I add these one percent positions up to four percent position, you know, I plan on hold for the whole, move just like I did with iron. So, that's just how I'm looking at the market, and I think it's still early given the You know, the, what we know about the demand for compute and just looking at the prices for, for these stocks, some of these are still priced as Bitcoin miners, right? which, which is funny.
₿itcoin ₿utcher: Let me ask you a few follow-up questions if you don't mind. with Bitdeer specifically, this is actually overlaps. I mean, I, I've had Trying to say this the nicest way possible, Mara and Bitdeer for different reasons, you've acknowledged that their management teams aren't the most trustworthy. So without restructuring their respective boards, I just don't like asking out loud, especially if you're looking for Bitcoin exposure right now, why not just buy? Spot. I mean, I think you like the AI call option, which is understandable, but I, the only one recently who I think is successfully pivoting would be, I think CleanSpark's done the best To rehab their, reputation, and they had, I forgot the guy's name who left their former CEO, and Matt assumed, reassumed from chairman to CEO, So like I, you know, and then they signed a nice lease, and then they optioned out eight hundred megawatts in Texas, and they're still waiting on their re-rate, and they still have a decent amount of Hodl, and they're doing the Mullet mining and all those things that they'll speak to, but like Mara and Bitdeer specifically, like the only, I'm just surprised someone doesn't just buy the power itself, but are you willing to take the dilution in the interim with Mara specifically, you know, I'm still pretty sure they use their ATM pretty heavily, I know they sold some Bitcoin recently, but Yeah, I just, I have no faith in Fred to turn this around because he's given no reason to.
BitcoinAIGuy: Yeah, so someone mentioned that too, like, I don't, I don't think these, CEOs are gonna stay the same. My, my thesis was like they're gonna leave, right? Like they're gonna get kicked out. And someone was like, "Well, Fred's the chairman of the board, that doesn't matter. The bo-uh, the board can still..." Independently remove the CEO and then, you know, figure out what the, you know, how to handle the chairman, right? I, I, I'm not buying, I'm not evaluating this b-based on b-because I trust Fred. I, I just think if they get acquired, right? There could be a short term opportunity there, some short term upside there, but long term, if they monetize gigawatts, there's, there's gonna be some value created, and I don't think Fred's gonna be there. you know, for the full, you know, pipeline. i-it's, you know, it's unfortunate, right, the stock's single digits. I bought the stock at six dollars in, in twenty twenty. Right? And obviously the dilution, it's been diluted like twenty, thirty x, since then under Fred's leadership, unfortunate for, those shareholders. But we're in a new, new market, you know? It's, you know, it is what it is. Like, I just see a single-digit stock, with what, five gigawatts, they said they have, so I'm just looking at it as an opportunity, as a catalyst, right? And it doesn't matter that You know, a handful of retail capitulated, they, they sacrificed themselves, right? They paid that price, they capitulated, but there's a new opportunity Right now, with Bitdeer, I mean, CEO, Chairman, he owns like a quarter of the company, right? And it's, they're not a Chinese company, they're a Singaporean company. Naturally, like a lot of people are gonna have, Skepticism because it's a foreign, company, just like Iron, is an Australian company, you know, Bitdeer has not been a great, you know, they, they have, they've, they've destroyed shareholder equity as well under CEO, its founder and CEO's leadership. but it, you know, it's a small bet for me, right? but they have a three-gigawatt pipeline. I have, you know, I have a belief that Bitcoin is going to perform over the next A year or so, and, you know, I think the operating leverage with Bitcoin is gonna help pay down the debt. They, they have a lot of debt on their balance sheet, you know, that in itself repels a lot of people I think the, eventually the co-location revenues are gonna help pay down that debt and, and be more, you know, attractive to institutional investors. And I, I didn't see the ATM coming. I was on the, I was tuning in and out of the earnings call for Bitdeer, and, you know, it was not the best call. they were-- they said one positive thing about financing, which was you know, they've got an attractive project financing, which, you know, we're, we're hearing ac-across the board, and then the ATM announcement, came and they're re-upping the old ATM, I think they only used like five hundred million or so, so, You know, they have a, a, you know, access to a billion ATM. I didn't predict that. A, a lot of people like messaged me, were like, "Did you know that about the ATM ahead of time?" And no, it was just unfortunate, but it is what it is. But yeah, it, it-- these are, these are turnaround stories, right? They're, they're messy. I, I think I heard you say you had some restructuring experience. I, I, I think from a, you know, stock perspective, the stock volatility is, consistent to what we've experienced, over the past few years in the sector. I just see, The AI story just getting better and better by the day, and, you know, it, it, it, that bullishness is making me be more forgiving on, on some of the names I've been, very critical on, and they don't have the best governance, right? I've had some very large, Fund managers, not just Mike Alfred, but o-others that have been very critical and messaging me publicly and privately saying like, you know, Bitdeer has poor cor-corporate governance. It's not just Mike saying it, other people are saying it too. And I, you know, I, I agree too, like, they've done a lot of shady stuff. they have a lot of shady stuff on their books. There's been a short, seller who's been very vocal. I've had him on a space before. and, and, and the CEO unfollowed me when I, when I did that, when I started asking questions. They didn't like that, right? So, you know, I'm trying to be very objective, right? in my, in my approach for some of these like laggards. but just listening to what's happening with CoreWeave and, and, and Nebius recently and soon Iron, we're gonna hear an update from them, right? i-i-it's just hard to, to just say this is gonna be like Bitcoin mining when there's like, where there's like essentially one winner in the market. i-i-think, you know, there's truly trillions of dollars in capital coming and, it, it- You know, logically speaking, if there's truly, truly infinite demand or insatiable demand for compute and power, then there, then there's no real competition. It's just, can you, like, how soon can you deliver? Like, your only competition is time. You're in a race against time. So I, I, I think it's that important to, for those that can, deliver, power and compute, and, there's plenty of, opportunities. Iron is significantly undervalued, right? and the opportunity cost of like redirecting out of iron, I think is high, so that's why I'm, I'm, I'm very cautious in allocating and I'm not like Taking all my gains from iron and just rotating into something highly risky like bitdeer or, marathon or whatever, right? Whatever the next Thing that hasn't run yet. I, I, I, I really like Iron, right? It's, it's, it's been a painful hold for many, for a year or so. But I'm, you know, thinking, you know, just two, three, four, five years out, we're gonna see another ten X, in my opinion. So, I, I'm, I'm sitting, on those shares, but I'm, oh, I'm, I'm staying open-minded to new opportunities.
₿itcoin ₿utcher: Well, thanks for coming up for that perspective. I'll wrap things up here 'cause there's another space about to start unrelated that I'm part of. I personally just, I can't I don't trust Mara and I respect, you know, position sizing and there's risk in whatever we do, but Mara and Fit, dear, I just, I personally, you know, I own NUAI, which is a five-six hundred million dollar market cap, and some guys, were able to speak to Wi-Fi tonight or even Kiel. I, I could say all three of those I would rather hold than those two, and their smaller market caps, where I think it is a, essentially that play on a small, a faster horse, I should say, that you can lean into, but it, they do remind me, these smaller cap plays are almost, when you're playing the cycle, they're almost the alt coins in a, you know, you and I have been around Bitcoin enough to know that when the market is hot, it does pay to trade down in the stack or play some of those more volatile names when times are good. I think the real test for a Wi-Fi or if NUAI certainly has to get a deal signed, and so does Keel, these smaller players, do they have the balance sheets and the business acumen to survive a bear market is what, is gonna be the biggest test, and I'm learning more about some of those opportunities more closely, I'm pretty confident given my ownership of NUAI and, But, you know, Keel like had guided for three deals by the end of the year, and then Ben backed off the other day on, "Well, they're still in negotiations." So just that was something else from the space that those who own Keel, I'd- We can talk about it another time, but that was kinda disappointing 'cause I know people who own it, and it just seemed like he was backpedaling a little from his guidance from June, and then after that guidance in June, they had a subsequent raise when the stock was around five dollars, and now it's back under four dollars. So just, per- I think
BitcoinAIGuy: Marathon said the same thing. I think Marathon said they were expecting like two or three or something, and then recently Fred on a call, earnings call- We said at least one, so, you know, he's not the-- Keel's not the only one.
₿itcoin ₿utcher: Yeah, it's just, people don't forget. Like, I think that's what drew people, they were upset with Tyler last year 'cause in August they didn't sign Barbara Lake. But then by September, he signed the first deal, September twelfth, I remember it, just 'cause I was, plus or minus a day or two, but I flew to New York and they announced the, unfortunately they announced the convertible note the same day, and that kinda took some of the fun away from it. But Tyler, to his credit, delivered multiple deals, but I'm gonna wrap things up here 'cause of another space that I gotta go to. I appreciate everyone's time tonight, and, I hope I hope we can do it again sometime. I'm trying to make an effort to learn more about the respective communities outside of my particular holdings because it helps my knowledge of the space. So thanks for everyone joining and sharing, and, we'll talk soon. Thank you, everyone.