Neoclouds such as Core Weave rent out servers and chips for AI computing, but often lease their own facilities, relying on chipmaker guarantees and supplier credit. Despite smaller assets, demand is high—Nscale recently signed a six-year, $45bn deal with Anthropic. The London-based startup, valued at $14.6bn, is set to go public, with board members including Sheryl Sandberg and Nick Clegg. Core Weave's shares have more than doubled since listing, and Nebius is up threefold.

However, risks loom. If AI infrastructure demand falls short or prices drop, the fallout could be severe. Chipmakers like Nvidia act as suppliers, investors, and guarantors, creating circular exposure—similar to the dotcom crash. Long-term rental contracts, some exceeding 10 years, may lock in costs, while technology could become obsolete quickly, as Nvidia's chips may age like old Nokia phones.

Termination clauses offer some flexibility—Anthropic and x AI's deal can be ended with 90 days' notice. Yet, the sector's Darwinian nature is evident: firms like Nscale and Ionic Digital previously pivoted from crypto mining. They may need to adapt again, but for now, the neocloud boom continues, driven by AI's insatiable demand for compute.