NeoLab's first business model: reselling GPUs

What happened: NeoLab AI startups that raised large funding rounds and locked in compute are reselling GPU capacity, per qbitai. Modal founder said many NeoLabs may become Neoclouds next year. Key numbers: Compute is often 50% to 70% or more of a NeoLab's total costs. Why it matters: A Silicon Valley VC said a full foundation model training run costs at least $10 million in compute, and Matt Murphy of Menlo called NeoLab one of the most overhyped investment areas. Musk predicted a wave of consolidation and failures among Neoclouds.

NeoLab AI startups that raised large funding rounds and locked in compute are reselling GPU capacity, per qbitai. Modal founder said many NeoLabs may become Neoclouds next year.

A Silicon Valley VC said a full foundation model training run costs at least $10 million in compute, and Matt Murphy of Menlo called NeoLab one of the most overhyped investment areas. Musk predicted a wave of consolidation and failures among Neoclouds.