The SpaceX IPO, Fable 5, AI Capex Update & Market Check w/ Gavin Baker, Andrew Fox & Clark Tang | BG2

**Brad Gerstner** (0:00)
I think we're all pretty AI-pilled, and if you're AI-pilled, that means we gotta build a lot more compute than the world thinks, and that these models are gonna be a lot more valuable than people think. You combine that with their core business, I don't know another entrepreneur or another business that's a better bet on the future than SpaceX. And so I think for most institutional investors, it's a must buy, a must own, is set it and forget it in order to have a real bet on both the space and the AI future.
All right, here we go. Early morning, Silicon Valley, BG2 is back. We're chopping it up on all things, tech and markets. To do that, I have none other than GB in the house, Gavin Baker from Atreides. He's brought his main guy, Andrew Fox. And of course, I had to draft Clark Tang into the mix, my partner, to talk about some of the big questions of the day. How should we be thinking about the SpaceX IPO? What are the big levers? There are big numbers out there for what's gonna happen over the course of the next few years. So let's break that down a bit, help simplify it for folks.
Mythos launched yesterday. I want to talk a little bit about like who's up, who's down in the race for super intelligence. Where are we? What did we learn with the Mythos launch? And Clark was in Taiwan last week with Jensen at Computex and GTC. So what was our takeaway there? What's going on with GPUs memory? Where are the bottlenecks? And where do we go from here? To start everything off, maybe just kick it over to you, Gavin, talking about the SpaceX IPO, the IPO is in two days. You're a big shareholder. Congratulations. We're also a shareholder. You know, we also expect to be buying in the IPO. The Wall Street Journal is reporting, you know, the Goldman Sachs are both saying $160 billion in revenue in 2028 We know that the IPO is $135 a share, $1.77 trillion.
So, when we think about kind of what the big levers are, there's so many moving parts in this IPO. Nobody's better than you at just breaking it down, simplifying it. What are the key levers that we ought to be thinking about that you're thinking about over the course of the next few years?

**Gavin Baker** (2:20)
Sure. So, great to be here. Thank you for having me. I thought we're going to call it BGGB, but we can stick with BG2. I'm in your house.

**Brad Gerstner** (2:28)
Hey, all subject to revision.

**Gavin Baker** (2:30)
That's okay. So, I think there's two big levers or variables that I think people should focus on, and I'm not going to comment on where I think those variables go.
But one is, you guys have this chart. Did you post this on X?

**Clark Tang** (2:47)
I did before, and then we also included a new edition with XAI's new deals as well.

**Gavin Baker** (2:53)
Yeah. So, Clark, who I've known for many years, did a great analysis here, and he shows that XAI's deal with Google for Cloud computing, generates more operating profit per gigawatt than Anthropic, than Meta, than Google, than OpenAI.
Their deal, actually, with Anthropic, also generates probably more operating profit than anyone but Anthropic. And so, you know, your colleague at Altimeter, Freida, also she calculated a 55% IRR on Colossus One. You know, if you can borrow money at six, seven, eight percent and invest in something with a 55% IRR, I'm not the most sophisticated thinker, but that math maths. And so I think the most important variable, one of the two most important is how quickly they bring on terrestrial data centers. We do know from Jensen that Elon brings data centers up faster than anyone. One hundred and twenty two days. Speed is literally cost, right? Because every day you're paying electricians and plumbers, that's cost.
And they're now monetizing them at arguably the highest rate. And so I think, you know, everybody should run their own math on that. But that is a massive variable. Yes. Truly massive variable. The second thing is, you know, we have a chart and it's wildly out of date now. It's kind of freaking amazing. This chart is, I think, is this chart from ten days ago? But in like the ten or twelve days since this chart, since we made this chart, which shows the Pareto curves for Opus 4.7 for coding, for Codex from OpenAI, and now we've had Opus 4.8, it was already out of date, and now we have Fable and Mythos, which is freaking wild, in 10 days. We would have had to update the chart twice.