Founder of Laveer Capital Management. Active #investor. Author.
Valparaiso, IN
Joined June 2015
- Tweets13.1K
- Following1.5K
- Followers1.6K
- Likes6.6K
Dudley K Beyler retweeted
SCOOP: Mark Walter is exploring selling his Cadillac F1 team at a $3 billion valuation. Comes 2 months after TWG said it was "not considering exiting its stake" in the team.
sportico.com/business/team-s… via @sportico
Dudley K Beyler retweeted
If you’ve seen Ken Griffin comparing neoclouds to airlines (notoriously bad businesses) and wondering where that’s coming from, this is a good intro read for you.
The central argument is that neoclouds have airline economics, but are increasingly being financed and valued as though they have much more durable cash flows.
A few takeaways:
1) Compute is perishable inventory.
An empty airline seat after takeoff is revenue lost forever, and so is an idle GPU-hour. 85%+ of the cost base is fixed, and the marginal cost of serving another customer is almost entirely electricity.
This creates enormous operating leverage but also brutal pricing dynamics when capacity exceeds demand, hence why Griffin warned that GPU rental prices could collapse in an oversupplied market.
2) Utilization drives everything.
Airlines generally break even around 80% load factors; a leveraged GPU cluster might break even around 65–75% utilization.
Nearly all the economic upside comes from those final percentage points so a relatively small decline in utilization can wipe out the equity.
3) The suppliers may capture more value than the operators.
NVIDIA is effectively Boeing + Airbus combined, controlling hardware supply and the upgrade cycle.
The scarcity of powered datacenters and grid interconnects gives the infrastructure owners significant bargaining power.
Neoclouds risk being squeezed between the hardware manufacturer, the infrastructure landlord, and increasingly commoditized compute pricing.
4) The financing looks remarkably like aircraft ABS.
Wall Street is financing GPU clusters through bankruptcy-remote SPVs, often using 70–80% LTV structures supported by multi-year contracts.
The contracts make the cash flows financeable, but the equity highly leveraged and sensitive to assumptions.
5) GPU asset life is uncertain.
A data center is analogous to an airframe, potentially useful for decades.
GPUs are aircraft engines, with faster technological obsolescence and no maintenance overhaul that restores their economic life.
TLDR: A business can grow revenue enormously while generating mediocre returns on invested capital. Airlines have demonstrated that for decades.
Alex’s full analysis goes much deeper into the aircraft ABS comparison, the capital structure, and the underlying economics.
Very much worth reading in full:
alexyangsong.com/blog/alumin…
A lot of ink has been spilled on GPU financing lately. I spent over a decade trading ABS on Wall St, and structured over $2B+ of debt financings as an operator (including at @tryramp). Figured I'd try to make sense of this market, so I went back to a framework I knew well: aircraft ABS and aircraft engine ABS.
My take: a GPU neocloud runs on airline economics, and the debt behind it looks a lot like aircraft engine ABS.
The parallels:
• Perishable inventory. An empty seat after the door closes is gone forever. So is an idle hour on an energized H100 rack.
• 85%+ of cost is fixed (servers, 10-year rack leases, 10-14% debt service). One more hour of compute costs pennies of power.
• Utilization is everything. Airlines break even around 80% load factor, a levered GPU cluster around 65-75%. The returns live in those last 25 percentage points.
• NVIDIA is Boeing and Airbus rolled into one. Powered shells and grid interconnects are the new airport slots.
• Wall St copied the aircraft financing playbook: take-or-pay contract plus servers in a bankruptcy-remote SPV, 70-80% LTV.
Part 1 of my blog post goes into a lot more detail:
alexyangsong.com/blog/alumin…
Dudley K Beyler retweeted
This is not normal what is happening in Louisiana right now. $300+ Billion in the project pipeline....
$100B – SpaceX Starbase LA (Planned)
$50B – Meta Hyperion AI Data Center (Under Construction)
$18B – Venture Global Plaquemines LNG Expansion (Planned)
$18B – Amazon Multi-Site AI Data Centers (Under Construction)
$18B – Argent LNG (Planned)
$18B – Woodside LNG (Under Construction)
$15B – Venture Global CP2 LNG (Under Construction)
$13B – Entergy Energy Buildout for Meta (Planned)
$10B – Commonwealth LNG (Under Construction)
$10B – Hut 8 AI Data Center (Under Construction)
$10B – Cameron LNG Expansion (Planned)
$8B – Ascencion Carbon Ammonia (Planned)
$6B – Hyundai Steel Mill (Under Construction)
$4B – Applied Digital AI Data Center (Under Construction)
$4B – CF Industries Ammonia Plant (Under Construction)
$4B – Lake Charles Methanol II (Planned)
$3B – Shintech Petrochemical Expansion (Planned)
$3B – DG Fuels Synthetic Chemicals (Planned)
$3B – Louisiana International Terminal (Planned)
Dudley K Beyler retweeted
Mamdani weighing in on DoorDash M&A as if NYC is their only market is hilariously ignorant
A combined $DASH and $CART will combine complementary tech and distribution networks that will offer more options for consumer and more orders for its gig employees (which means more $)
I do think drivers should get paid more for the service they provide which would drive up cost for users, but it is ultimately a luxury to not have to get up off your ass and have someone deliver something to your doorstep
That said, I also think this acquisition makes strategic sense in light of increased competition from Amazon, Uber, Walmart and other giants offering better pricing and faster execution (a net positive for consumers)
We don’t need government stepping in to block clearly synergistic M&A and distorting free-market dynamics
We can point to Elizabeth Warren’s campaign to block the JetBlue / Spirit Airlines merger, which she touted as a big victory for consumers, only for Spirit to ultimately shut down and leave consumers worse off with less choices
Just last month, DoorDash couldn’t seem to find the money to pay their deliveristas — until our administration forced them to give back $131M+ in stolen wages and penalties.
This week, they’ve managed to find $17 billion to acquire one of their main competitors.
Corporate consolidation means higher prices, harsher exploitation, and greater economic inequality for New Yorkers.
We’ve stood up to these giants before. That doesn’t stop now.
Dudley K Beyler retweeted
My favorite part of the Anthropic S-1 is how they casually list the risk of killing humanity in between interest rate and customer concentration risks
Dudley K Beyler retweeted
This stat from the Atlanta Braves is wild 👀
In 2025:
⚾ Baseball business → $51M income
🏙️ Mixed-use business → $68M income
The real estate+ businesses surrounding the Braves generated 34% MORE operating income than the baseball team itself.
Dudley K Beyler retweeted
The biggest lesson of any capex cycle is to not take equity risk for a fixed rate of return. That's what the neocloud problem is.
Lending to SpaceX with Starlink-type revenues or strong offtakes and you get a bond, but lending to a borrower whose only asset is GPUs and only customer is another AI company is just equity with a coupon cap.
Credit is pricing that split. Apollo is telling you that good GPU financing can get done at +200/+250 over, and when Volta tried to raise $5 billion for a Norway data center earlier this month, investors balked and pushed the rate to 11%+.
Slok's point on if compute costs more to produce than users get out of it, the collateral is worth less every quarter tells you everything you need to know and that's all before we talk about the equity of the business.
Elon is right that the debt markets haven't been receptive. It is pretty clear that the market is starting to price in that equity risk to the space.
Pretty much.
As of the past few weeks, debt markets have almost entirely shut off access to money for any company that doesn’t have substantial revenue independent of AI data centers.
SpaceX closed $40B of debt for GPUs, but we’re investment grade and have Starlink & launch revenue.
That means the 200+ neoclouds are going to see guppy-level death and consolidation. Some will make it through, but not many.
Dudley K Beyler retweeted
As someone with a portfolio of energized land assets here is what I am seeing:
1. Neoclouds are disorganized and poorly capitalized. Some are definitely better than others however.
2. Hyperscalers are intractable, bureaucratic organizations that take 3 months to do an NDA and want 18mo escrow periods. We built our portfolio by competing against these terms because of our speed and simplicity. The more future assets orgs like ours win, the bigger the problem for the hyperscalers downstream (see 3).
3. There are delays in the existing pipeline that will catch people off guard in 2027. Hyperacalers will (obviously) react by focusing on their own internal compute needs over any third party. If the third party is a model company, they will tell them to go through their model router where they will also take a non-trivial vig. Them telling Ant they have no compute for them (rumored in Ant’s S-1) if true is a huge tell that this is already happening.
All of this is to say that it does look like there will be a lot of partially stranded compute and compute sitting in inventory in 2027 than is currently forecasted. This is bought and paid for but effectively underearning (below total cost of capital) or collecting dust. We see this as true for everyone - model companies, hyperscalers, neoclouds except ONE (you can guess which one).
This dislocation will benefit two kinds of orgs: the non-bureaucratic big scalers who can build industrial scale quickly and the nimble, well capitalized players feeding them.
2027 will be a turbulent year because it will clear out a bunch of wrong/bad bets. It will also be a consolidation year for a few.
I think we do understand
Dudley K Beyler retweeted
Instead of increasing shareholder value today I decided to enjoy a little fall golf
Dudley K Beyler retweeted
The first version of anything you build will be a little embarrassing.
Ship it anyway.
You learn more from one real person using it than from ten more weeks of polishing in private.
Dudley K Beyler retweeted
An LA hospitality group runs 25 bars, many of them right by Dodger Stadium. Every extra playoff game means packed bars. An early exit means lost revenue they were counting on.
So they hedged it. They put $60,000 on Kalshi on the Dodgers *not* making the World Series.
The Dodgers lost the NLCS to the Brewers. The position returned nearly 2x, helping cover the playoff business that *never* came.
A Columbia law professor told Fortune it works like “a form of bespoke insurance.”
Read the full story here: fortune.com/2026/10/19/predi…
