Dylan Patel: evaluation

Transcript context

…Okay, a spicy question. You’ve explained that SemiAnalysis sells these spreadsheets. You’re always pointing out how six months or a year ago, you warned people about the memory crunch. Now you’re telling people about the cleanroom crunch, and in the future, the tool crunch. Why is Leopold the only person using your spreadsheets to make outrageous money? What is everybody else doing? I think there are a lot of people making money in many ways. Leopold jokes that he’s the only client of mine who tells me our numbers are too low. Everyone else tells me our numbers are too high, almost ad nauseam. Whether it’s a hyperscaler saying, “Hey, that other hyperscaler, their numbers are too high,” and we’re like, “Nah, that’s it.” They’re like, “No, no, no, it’s impossible,” blah, blah, blah. You finally have to convince them through all these facts and data when we’re working with hyperscalers or AI labs that in fact, no, that number isn’t too high, that’s correct. Eventually, sometimes it takes them six months to realize, or a year later. Other clients, on the trading side, also use our data. Roughly 60% of my business is industry. So AI labs, data center companies, hyperscalers, semiconductor companies, the whole supply chain across AI infrastructure. But 40% of our revenue is hedge funds. I’m not going to comment on who our customers are, but a lot of people use the data. It’s just how do you interpret it, and then what do you view as beyond it? I will say Leopold is pretty much the only person who tells me my numbers are too low, always. Sometimes he’s too high, sometimes I’m too low. But in general, I think other people are doing that. You can look across the space at hedge funds and look at their 13Fs and see they own, maybe not exactly what Leopold does, because it’s always a question of what is the most constrained thing. What’s the thing that’s going to be most outside of expectations? That’s what you’re really trying to exploit: inefficiencies in the market. In a sense, our data is making the market more efficient by making the base data of what’s happening more accurate. Many funds do trade on information that is out there… I don’t think Leopold’s the only person. I think he has the most conviction about the AGI takeoff, though. Right, but the bets are not about what happens in 2035. The bets that you’re making—that are at least exemplified by public returns we can see for different funds including Leopold’s—are about what has happened in the last year. The last year stuff could be predicted using your spreadsheets. It’s about buying the next year’s spreadsheets.…

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