Crusoe, a vertically integrated AI infrastructure company spanning energy, data centers and a managed AI cloud, has surpassed 2,000 employees, and CEO Chase Lochmiller scales it by trusting domain experts in each vertical.
Lochmiller says CEOs almost always fire too slowly and that companies scale exponentially while people scale linearly, a view Brian Halligan says runs opposite to his own hire-slow, fire-fast practice.
Lochmiller says Crusoe aims to be an AI supermajor like Exxon Mobil and Chevron, welcoming rivals chasing the same opportunity because competition validates it.
Crusoe aims to be the Exxon of AI infrastructure
Crusoe is betting that AI compute infrastructure works like the oil and gas value chain, where one integrated player can become a supermajor. It started by turning flared natural gas into compute and now sources power from many kinds of energy. Holding that much scope together depends on trusted domain experts in each vertical and fast decisions on people.
Takeaways
Crusoe is vertically integrated AI infrastructure. Crusoe spans energy generation, power plants, data centers, electrical equipment manufacturing and a managed AI cloud. Lochmiller likens AI compute to the oil and gas value chain and wants Crusoe to be an AI supermajor like Exxon Mobil and Chevron.
Energy comes first, from many sources. Crusoe activates megawatts from natural gas, nuclear, wind, solar and batteries. It is working with Oklo on an SMR-powered AI factory at Idaho National Laboratory and draws on cheap power in Iceland and Norway. Lochmiller expects Form Energy and Antora to deliver cost-effective 100-hour batteries.
Scaling means trusting domain experts and repeating direction. Lochmiller finds domain experts in energy, data centers, manufacturing and AI cloud and trusts their decisions. A weekly staff meeting covers the whole business, and alignment means repeating the direction until he is sick of saying it. Crusoe has passed 2,000 employees.
Most company problems are people problems. Lochmiller says CEOs almost always fire too slowly, because companies scale exponentially while people scale linearly. Halligan says he did the opposite of hire slow and fire fast. Databricks has kept a stable management team for ten years.
Competitors validate the opportunity. Lochmiller recalls early advice that most startups die from suicide, not homicide. A rival chasing the same opportunity validates it, because good opportunities usually support several winners. He does not see AI compute infrastructure as winner-take-all, and partners may also compete with Crusoe.
CEOs need thick skin and must seek bad news. Lochmiller calls data center protests a product of misinformation and says the industry's biggest problem is marketing. Crusoe has increased security. He says a CEO receives bad news often, and Halligan adds that CEOs should train their organizations to deliver it.
How Crusoe found its market
Crusoe began with stranded natural gas flared in oil fields, aiming to bring the market for compute to the energy rather than energy to a market.
Bitcoin mining became the first way to monetize that energy.
ChatGPT launched on 11/30/2022 and pulled demand toward AI compute.
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On this episode 2
Show 1
Lochmiller sold the Bitcoin business to NYDIG, led by Tejas Shah, to focus on AI infrastructure and because some investors' firms were barred from crypto-linked investments. He remains a Bitcoin supporter.