How the Hedge Fund Magnetar Is Financing the AI Boom
Odd Lots
Bloomberg
4.4 • 1.6K Ratings
🗓️ 9 December 2024
⏱️ 53 minutes
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Summary
AI software and the hardware that enables it have been hugely popular investments this year. But there have still been limiting factors on the sector, including a shortage of compute to power so many new start-ups. Investors don't want to finance companies that lack a signed contract for compute, and compute providers don't want to sign contracts for startups that haven't already secured funding. Now Magnetar, a hedge fund which started its first ever venture capital fund earlier this year, is trying to solve this "chicken and egg" problem by offering compute in exchange for equity. Magnetar was an early investor in the AI space, partnering with Coreweave and recently helping the hyperscaler to raise $7.5 billion. On this episode, we speak with Jim Prusko, partner and senior portfolio manager on Magnetar's alternative credit and fixed income team, about why the hedge fund is getting into venture capital and some of the new ways they're deploying money in the space.
Read More: Magnetar Starts First-Ever Venture Fund, Targets Generative AI
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| 1:08.5 | Bloomberg Audio Studios Podcasts Radio News |
| 1:13.2 | Hello and welcome to another episode of the Oddlots podcast. I'm Tracy'm Tracy Allaway. And I'm Joe Wisenthal. |
| 1:32.0 | Joe, AI is so hot right now. In the immortal words of Mugatu, AI is so hot. |
| 1:38.8 | It is, yes, it is really hot. You know, you hear something, there's a little bit of slowing down and some of the |
| 1:44.5 | progress on the models. But the recent InVIDIA results speak for themselves. There's nothing that I've |
| 1:52.1 | seen yet that would suggest that this macro trend, at least as an investment trend, and I'm not |
| 1:58.0 | talking about stocks per se, is anywhere close to, quote, slowing down. |
| 2:02.8 | Yeah. And the interesting thing is we seem to be having more and more players, some new types of players that are getting into the space. |
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