Hm…CoreWeave isn’t a land baron; it’s a GPU middleman. Its margins are sandwiched between Nvidia (upstream) and landlords/utilities (downstream). Unless it locks in long-term control of power and property, it’s just timing an arbitrage window before vertical integration crushes it.
While CoreWeave's position in the GPU supply chain is indeed vulnerable to margin compression from both directions, I disagree that it's merely timing an arbitrage window - their rapid infrastructure buildout and specialized AI deployment expertise creates genuine value that won't easily disappear through vertical integration alone. Especially in an era of constrained capacity (the next 5+ years).
Appreciate the thoughtful reply, Chris. I agree that infra buildout speed and AI specialization are valuable, but they’re not durable in the absence of control over scarce inputs. CoreWeave’s model works while supply is constrained and hyperscaler demand is desperate. But what happens when Nvidia reshuffles allocation or hyperscalers build their own campuses? The execution edge evaporates unless it’s backed by lock-in or control. That’s why I see this less as a long-term moat and more as tactical positioning in a transient bottleneck regime.
I hear that, I think they now have the capital and resources to secure more of the downstream resources like real estate/utilities and are starting to do so.
Hm…CoreWeave isn’t a land baron; it’s a GPU middleman. Its margins are sandwiched between Nvidia (upstream) and landlords/utilities (downstream). Unless it locks in long-term control of power and property, it’s just timing an arbitrage window before vertical integration crushes it.
While CoreWeave's position in the GPU supply chain is indeed vulnerable to margin compression from both directions, I disagree that it's merely timing an arbitrage window - their rapid infrastructure buildout and specialized AI deployment expertise creates genuine value that won't easily disappear through vertical integration alone. Especially in an era of constrained capacity (the next 5+ years).
Appreciate the thoughtful reply, Chris. I agree that infra buildout speed and AI specialization are valuable, but they’re not durable in the absence of control over scarce inputs. CoreWeave’s model works while supply is constrained and hyperscaler demand is desperate. But what happens when Nvidia reshuffles allocation or hyperscalers build their own campuses? The execution edge evaporates unless it’s backed by lock-in or control. That’s why I see this less as a long-term moat and more as tactical positioning in a transient bottleneck regime.
I hear that, I think they now have the capital and resources to secure more of the downstream resources like real estate/utilities and are starting to do so.