The company Old Huang started for compute power loans jumped 17.7% yesterday, but its market cap is still only $1.887 billion. With such a low valuation, it’s true that banks are unlikely to lend money to this kind of company—just the depreciation of hardware alone could wipe out its market cap. Sharon AI got 40,000 Grace Blackwell GB300 GPUs from Old Huang, worth over $2.5 billion. Selling hardware has a gross profit margin of 65%, which basically means NVIDIA invested $1 billion into this company, but in the form of compute power loans instead of equity investment—making it less risky. Worst-case scenario, the compute power doesn’t sell, and the GPUs turn into residual value. I think this is an upgrade to the business model. This business model might also be adopted by OpenAI and Anthropic. Using compute power to invest in companies cuts costs in half (based on the gross margins of these two companies) and allows for a share of the company’s future revenue. Actually, domestic players like Alibaba Cloud investing in Zhipu, Minimax, and Kimi are also using this same approach. It might not necessarily be a bubble—at least the flywheel is spinning before the bubble bursts. This business model is pretty interesting.