{"id":381,"date":"2026-06-12T20:12:09","date_gmt":"2026-06-12T20:12:09","guid":{"rendered":"https:\/\/longhaulmovingpros.com\/?p=381"},"modified":"2026-06-12T20:12:09","modified_gmt":"2026-06-12T20:12:09","slug":"spacexs-stratospheric-ipo-launch-has-a-couple-of-heavy-duty-stowaways","status":"publish","type":"post","link":"https:\/\/longhaulmovingpros.com\/?p=381","title":{"rendered":"SpaceX\u2019s Stratospheric IPO Launch Has a Couple of Heavy-Duty Stowaways"},"content":{"rendered":"
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The AI boom is usually framed as a cutthroat competition between a small handful of powerful tech companies. That\u2019s accurate, but it also overlooks a much subtler, stranger, and more alarming dynamic: Namely, that the very same companies that are competing to build and control the future of AI are at the same time bankrolling one another.<\/span><\/p>\n

Read more Here\u2019s How Much More Money Elon Musk Has Than Larry Page, Jeff Bezos, and You<\/a><\/p>\n

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The enormous demand for compute and energy from frontier AI developers like OpenAI, Anthropic, and Google has been forcing those companies to buy and lease resources from their erstwhile competitors, creating a messy web of interdependency of von Bismarckian proportions. It\u2019s also resulted in a complex network of circular moneymaking arrangements. The most common goes something like this: Company A buys AI chips from Company B, which then invests in Company A to help fuel its AI efforts, ratcheting up its data center expansion plans and fueling its demand for Company B\u2019s chips. The carousel of capital spins on and on from there.<\/span><\/p>\n

For the past couple of years, Nvidia has been at the epicentre of the ever-evolving web of circular dealmaking that\u2019s come to enmesh the AI industry. The chipmaker\u2019s graphics processing units (GPUs) have been\u2014and continue to be\u2014the most valuable building block in the AI boom. It\u2019s also been investing heavily in AI startups like OpenAI and Elon Musk\u2019s xAI, which was acquired by SpaceX in February. So while the AI labs buy AI chips from Nvidia, the latter returns the favor by funding the construction of the massive data centers that house the chips and ultimately power models like ChatGPT and Grok.\u00a0<\/span><\/p>\n

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In November, it was <\/span>announced<\/span> that Anthropic would pay $30 billion for expanded access to Azure, Microsoft\u2019s cloud computing arm, which is powered by graphics processing units (GPUs) made by Nvidia. Nvidia and Microsoft, in turn, said they would invest up to $10 billion and up to $5 billion in Anthropic, respectively. (See the circularity?) The extra compute helped Anthropic meet demand from businesses using its popular enterprise tools and from developers using its popular coding assistant, Claude Code. It usurped OpenAI last month as <\/span>the <\/span>highest valued AI startup<\/span> in the world.\u00a0<\/span><\/p>\n

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Bloomberg<\/span><\/i> published a <\/span>helpful graphic<\/span> in January that visualizes the web of circular deals being woven across the AI industry. But the number of such agreements has continued to grow since that time. In March, for example, Amazon committed $50 billion to OpenAI as part of the ChatGPT-maker\u2019s most recent funding round, while OpenAI said it would invest an additional $100 billion into its existing partnership with Amazon Web Services (AWS), Amazon\u2019s cloud computing business. Behind the scenes, Nvidia is selling AI chips to both Amazon and OpenAI, entwining the fortunes of all three companies.<\/span><\/p>\n

You get the idea.<\/span><\/p>\n

Foundations of sand?<\/b><\/h3>\n

Tech leaders tend to argue that the burgeoning circularity extending across the industry is a virtuous circle that benefits everyone. But skeptics see a noose that\u2019s tightening around the tech sector, and perhaps even around the throat of the U.S. economy itself.<\/span><\/p>\n

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Companies driving the AI boom, like OpenAI and Anthropic, have yet to become profitable, and the surge of investment across the industry in recent years has very much been a gamble that the technology will deliver on the financial growth that companies have been promising. The concern is that the more intertwined these companies become, channeling money back and forth for a technology that has yet to deliver real value for businesses, the chances of financial catastrophe grow.<\/span><\/p>\n

If demand for AI fails to take off in the way that people like Sam Altman, Dario Amodei, and Elon Musk predict it will, many of those enormous data centers that have been built over the past few years will suddenly become useless. The AI labs will suddenly be unable to pay their bills to the companies providing them with chips and compute; and since those same companies were the major backers of the rest of the industry, the whole edifice could crumble\u2014skeptics warn\u2014into the foundation of sand upon which it was built.<\/span><\/p>\n

The economic impact of such a collapse could have consequences far beyond Silicon Valley itself. The ballooning investments in the tech companies driving the AI race in recent years have become an important financial driver for the U.S. economy itself, helping to bolster the country\u2019s GDP at a time when it\u2019s fighting through the twin headwinds posed by inflation and tariffs. Millions of Americans\u2019 financial security is also tied directly to the fortunes of the tech industry through common financial vehicles like 401(k) plans.<\/span><\/p>\n

Read more Coinbase Says Let the AI Agents Trade Fartcoin<\/a><\/p>\n

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The SpaceX IPO rocket<\/b><\/h3>\n

On Thursday, SpaceX\u2014officially called Space Exploration Technologies Corp.\u2014announced the finalization of its long-awaited initial public offering (IPO) price of $135 per share. It\u2019s by far the biggest IPO in history and has officially minted Musk, its founder and CEO, as the world\u2019s first trillionaire.<\/span><\/p>\n

SpaceX is probably best-known as a manufacturer of rockets and satellites (Starlink is a subsidiary), but it\u2019s also become a major force in the AI industry through its data center infrastructure. It\u2019s been selling the compute created by these data centers to some of the very companies that are supposed to be competing with xAI.<\/span><\/p>\n

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For example, Anthropic <\/span>announced<\/span> last month it had agreed to pay $1.25 billion per month to access SpaceX\u2019s Colossus 1 data center, located in Memphis, Tennessee, billed by SpaceX as \u201cthe world\u2019s biggest AI supercomputer.\u201d Through the deal, Anthropic said it would gain access to 300 megawatts of electricity powered by 220,000 Nvidia GPUs. And last week, SpaceX said it had inked a multiyear agreement with Google, through which Google will pay $920 million per month for compute to power its AI efforts. (The collaboration is expected to kick off in October and extend through July of 2029.) <\/span><\/p>\n

Meanwhile, Anthropic and Google have been deepening their own financial ties: In April, Google said it would <\/span>invest up to $40 billion<\/span> in Anthropic, which had recently teased Mythos, a model that was supposedly too powerful to release publicly. And according to a report published Thursday by\u00a0The Information<\/em>, Anthropic is also moving ahead with plans to lease data centers from a number of U.S. companies, with Google potentially stepping in as a guarantor.<\/span><\/p>\n

Nvidia, Amazon, Google, and the other tech giants that are providing new AI startups with computing power are often referred to as \u201cpicks and shovels\u201d companies of the AI boom, referring to the industry that profited from miners\u2019 dreams of riches during the California Gold Rush. The vast majority of miners didn\u2019t strike gold, but the ones providing the picks and shovels profited from the broader frenzy of speculation and greed. By investing in its data center infrastructure and making lucrative deals with Google and Anthropic, SpaceX is clearly trying to become a dominant picks and shovels company in the AI race.\u00a0<\/span><\/p>\n

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Much of the early excitement from investors in the SpaceX IPO has been driven by Musk\u2019s promise of building data centers in space, powered by an unlimited supply of solar energy. It\u2019s the sort of futuristic-sounding vision\u2014along with Musk\u2019s goal of colonizing Mars\u2014that appeals to many investors who (not unreasonably) believe in his ability to deliver on impossible-sounding promises. But it also remains to be seen if data centers in space are technically achievable. Coupled with the uncertainty of the future of the AI industry to which SpaceX has hitched its fortunes, its stock start to look like a riskier investment than its initial market surge would suggest.<\/span><\/p>\n

Yes, the rocket that is SpaceX\u2019s valuation has the twin engines of Google and Anthropic\u2014two of the MVPs of the AI boom\u2014powering it. But the circularity of the relationship between these companies makes all of their situations more precarious than they may initially appear. If the rocket comes crashing back down to Earth, it could bring much more than Google and Anthropic down with it.<\/span><\/p>\n

Read more Xbox CEO Is Preparing Gamers for When Hardware Is a Luxury<\/a><\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

Big tech says its circular dealmaking is a virtuous dealmaking. To others it looks more like a noose.<\/p>\n","protected":false},"author":1,"featured_media":380,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-381","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-commerce"],"yoast_head":"\nSpaceX\u2019s Stratospheric IPO Launch Has a Couple of Heavy-Duty Stowaways - Long Haul Moving Pros<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/longhaulmovingpros.com\/?p=381\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"SpaceX\u2019s Stratospheric IPO Launch Has a Couple of Heavy-Duty Stowaways - Long Haul Moving Pros\" \/>\n<meta property=\"og:description\" content=\"Big tech says its circular dealmaking is a virtuous dealmaking. 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