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Chapter 1: What is the main topic discussed in this episode?
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Subject to credit approval, Apple Card issued by Goldman Sachs Bank USA, Salt Lake City branch. Terms and more at applecard.com. Bloomberg Audio Studios. Podcasts. Radio. News. Talking about the use of AI, for that you need infrastructure. We'll talk about that now. Nscale, a UK developer for AI data centers, is now one of Europe's most valuable startups.
After raising $2 billion in a recent round, which now values the company at a cool $14.6 billion. Now the AI hyperscalers are also looking to this particular company. because they want to be looking for more compute, but also they've got some significant leaders coming in.
Directors, including former British politician, Nick Clegg, Sheryl Sandberg as well, longtime chief operating officer of Facebook and its parent Meta. And I'm very pleased to say we can welcome the leadership now. Nscale CEO, Josh Payne, along with Sheryl Sandberg. It is a joy to have you both on the show.
And Josh, some huge ambitions from Nscale and just the computing power that you can bring online the revenues you're going to be generating the next few years. Just talk to us about how you achieve that, that necessary infrastructure, Josh.
Well, thank you, Caroline. It's great to be here. You know, firstly, what I'll say is this is the fourth industrial revolution. This market is moving so fast and we're still at the beginning. We're talking about a technology that is going to lead to, you know, automated drug discovery, the extension of human life, truly autonomous agents.
And the only thing that prevents that future is access to the scarce resource, which is the compute. And so N-scale solves this problem. We buy and build and deploy all of that infrastructure to allow for these products to be built and operated. And so not only is there just huge demand for the sector, but we're capturing it.
And there's huge demand for your expertise, Cheryl, and to join boards. Why did you choose Josh? Why did you back Emscale? Why on the board?
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Chapter 2: What is Nscale and why is it significant in the AI data center market?
Well, the funny part of the story starts with his part, which is...
Well, so thinking about how I build the next great AI platform, what was most important to me is speaking to executives that have built great platforms before of global scale. And so certainly none better than Sheryl Sandberg. And so I tried for some time to get an introduction to Sheryl. And upon finally doing so, we scheduled a 30-minute call.
Chapter 3: How did Nscale achieve a $2 billion funding round?
And the first thing that she said to me was, I don't do boards and I don't do these calls.
So it was an inauspicious beginning, but I didn't do boards and I didn't do these calls. But what I saw in Josh 90 minutes into our 30 minute phone call was what I considered real visionary leadership. Over the next few weeks as he was trying to get me to consider joining the board, he went away and he wrote a letter to his management team.
And the only person I'd ever seen write like that was Mark Zuckerberg. This combination of a relentless, relentless desire for great, relentless desire for execution. You know, and from my point of view, I joined Google when it was at 250 people, left at 20,000. I joined Facebook when it was 550 people, left almost 100,000. So the opportunity to work with a founder I believe in
I joined right as the company was about 300, 400 people, so that same spot, and try to take some of the lessons we've learned and help a company I believe in this much scale really matters. I also really believe in the power of AI. I think we're at the very beginning. I started my career in global health.
AI is going to mean that anyone in a remote village anywhere in the world could get skin cancer diagnosed at the same efficacy rate. as someone in the Mayo Clinic. But that is going to take a build-out and a build-out of infrastructure and compute. And I really believe in Josh and Nscale's ability to do that. So I'm happy to be here.
Josh, the term Neocloud has actually also become quite broad. When I talk to people about Nscale, they say, well, Nscale is modular. How do you set yourselves apart from the other Neoclouds out there, many of whom come on this program and make quite similar pitches?
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Chapter 4: What role does Sheryl Sandberg play at Nscale?
Yeah, so I think the key distinction with N-scale is we are fully vertically integrated. Again, if you think about the challenge for the sector, it's actually landing the infrastructure on the ground and getting it plugged in. And the true scarcity, given the demand in the sector, is the land, the power, and then the chips.
And so, by and large, the neocloud sector is not really vertically integrated in that they don't own their own land and power.
n scale does we own the land and power we own the chips and we own the software delivering an end-to-end service to the counterparty in addition we recently acquired a company called american intelligence corporation in west virginia which adds an even further segment to that which is the ownership of the power this is a behind the meter site which means that we're effectively taking natural gas and
producing our own energy, which means it's not connected to the local grid and therefore subject to any kind of price increases for consumers.
Cheryl, it's great to have you back on Bloomberg Television and on Bloomberg Tech. You said, I don't do boards historically. With this role with Nscale, I think a lot of people are really interested if you go back to being an operator. With time, if you would join the executive ranks at Nscale, and whether you do or don't, kind of operationally, how you think you can help the company grow.
So I've joined as both a board member as an advisor. I'm spending real time with Josh and his team. I have no plans to go on board full time. They have an incredible exec team. And my goal is to help them scale, help figure out how we structure, how we do corporate governance. I've helped recruit some other great board members. Nick Clegg, you mentioned, joined the board with me.
Sue Decker, who has decades of experience chairing audit committees and in the financial world. and work with them to really scale their company. What I see in Josh is two things. Is real ambition, like real ambition to make a difference in how the AI build out happens. Make it sustainable, make it clean, commitment to local jobs as we scale and build.
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Chapter 5: What are Josh Payne's ambitions for Nscale's infrastructure?
but also a commitment to excellence, to hiring the best people, to getting people into the right jobs, to structuring so that we can really execute. And it's been, it already has been a great pleasure to work this closely with someone I believe in. And also, Caroline, I know you always care about this, a really strong team of senior women. head of AI infrastructure, CFO, head of security.
Josh, before me, hired what he considers, who he considers the best people and a lot of great women in those jobs.
I love that because it's something I'm passionate about. It's something that you spend your career advocating for, Cheryl, is... diversity within the ranks of talent, but also you're advocating as well for clean energy. And I noticed you've got one other board seat with TerraDot, and that is about carbon neutrality. So Josh, I ask you, what about carbon neutrality for West Virginia?
Because that's about natural gas. How do you think about that in the longer term?
Yeah, sure. So broadly, the company thesis is to take sustainable energy and convert it into intelligence. So we first do this in the north of Norway. So we operate in the north of Norway using only hydropower. The north of Norway has such a large oversupply of energy due to basically the seasons. Effectively, during the winter, all of the glaciers melt over.
And then in the summer, they all melt and create enormous waterfalls. And the Norwegian government has built large hydropower dams to capture that energy. But the challenge is it can't be exported. And so it's got to be consumed in region.
So Emscale is building some of the largest AI infrastructure projects on the European continent in the north of Norway, taking otherwise stranded energy and converting it to intelligence. The same goes for our projects in Texas, as an example. In Texas, you've got a similar oversupply of renewables and other energy, but it's in remote location.
So we're building some of the largest infrastructure projects in North America in this location in order to convert that to intelligence. Now, in West Virginia, we're doing the same thing, but slightly different. In West Virginia, we're producing our own energy. One of the challenges with the North American grid is constraint.
And so we felt that producing our own energy with natural gas generators, i.e. behind the meter, was the best way to scale sustainably, but also not impact local prices and the grid.
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