Dylan Patel - Inside the Trillion-Dollar AI Buildout - [Invest Like the Best, EP.442]
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The best operators have a relentless focus on leverage, finding ways to multiply their impact rather than just working harder. But here's what I see happening in finance teams everywhere. Brilliant people getting buried in expense management busy work. If you think about it, you become a finance leader because you love strategic work. Modeling scenarios, optimizing capital allocation, finding the insights that actually move the business forward. But instead, you're chasing receipts and categorizing transactions. It's the opposite of leverage. This is exactly why I'm so bullish on what the team
Patrick O'Shaughnessy is the CEO of Positive Sum. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of PositiveSum. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of positive sum may maintain positions in the securities discussed in this podcast. To learn more, visit psum.vc.
My guest today is Dylan Patel. Dylan is the founder and CEO of Semi Analysis. At Semi Analysis, Dylan tracks the semiconductor supply chain and AI infrastructure build out with unmatched granularity, literally watching data centers get built through satellite imagery and mapping hundreds of billions in capital flows. Our conversation explores the massive industrial build out powering AI. From the strategic chess game between OpenAI, NVIDIA, and Oracle, among others, to why we're still in the first innings of post training and reinforcement learning. Dylan explains infrastructure realities like
I think it's very very simple. You've got OpenAI paying Oracle lots of money. You've got Oracle paying NVIDIA lots of money. You've got NVIDIA paying OpenAI lots. Spider Man meme. We've got we've got the infinite money glitch here. No. No. No. It is that's not actually what's happening. If they pay each other, then their market caps all keep going up. What's really happening is OpenAI has an insatiable demand for compute. The compute precedes the buildup of business. You have to have the cluster before you can run models on it for inference. You have to have the cluster to train the model. Tha
The sport of kings.
Yeah. This is very much like the Pascalian wager nature of all of this with the tech giants. Oracle can be part of it but OpenAI needs allies. They need people to effectively spend the capex ahead of the curve and trust that they'll be able to pay the rental income. Because that's what it is at the end of the day. OpenAI is committing to five year deals. These five year deals cost x amount of money. It's 10 to $15,000,000,000 per gigawatt of data center capacity that you pay a year. And then that 10 to $15,000,000,000 per gigawatt of data center capacity, you're paying that for five years. Oka
I wanna dig into the underlying assumptions driving this on the training and inference side because obviously there's the willingness like Zuckerberg just needs to go down the hall to CFO to get access to all this capital. He doesn't even need to go down the hall. Can just make it so.
He's got the voting shares
right Sam's gotta fly to Norway and Saudi and and other places. But I wanna make sure I understand your thinking on the underlying two sides of this. One which is like your view on the diminishing return curve on just
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