Platformonomics TGIF is a weekly roll-up of links, comments on those links, and perhaps a little too much tugging on my favorite threads.
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We’re going to Cleveland in June! What is must-see in Cleveland? What can we learn from Cleveland’s history to help Seattle navigate its unfolding economic transition?
Meanwhile, lots going on!
News
RIP Soma
Mononymous like a rock star, Soma very successfully played against type in the sharp-elbowed worlds of both Microsoft and venture capital. He will be missed.
Never Take a Dependency on Elon Musk: Space Twitter S-1 Edition
We regularly catalog the many reasons you’d be foolish to take a dependency on fractional CEO and serial nuisance litigant Elon Musk.
Owning $SPCX is a complete and utter dependency on Elon, and all the more so if it trades anywhere close to the elevated valuations being floated.
Normally you’d gets some protections investing in a rug pull when a massively overcapitalized startup gets dumped on retail investors. But Space Twitter’s combo S-1 filing and picture book suggests we can’t let frivolities like management accountability or corporate governance get in the way of going to Mars.
Elon has 85% voting control and Space Twitter will be availing itself of the governance exemptions available to a “controlled company”.
A year from now when the stock is in the tank and Elon laughs at fanboy capital losses, remember you were warned.
The Price-to-Elon Ratio
The Space Twitter financials are universally underwhelming. Modest revenue. Unprofitable. Slow and decelerating growth. Eyeball metrics. AI spend without any AI traction. Starlink is a nice business (and product), but that is about it. Data centers in space, a Mars colony, competing with the entire semiconductor industry, even a frontier AI model are just hand-waving.
The S-1 says “we have identified the largest actionable TAM in human history”, of which 80% is “enterprise apps” (and there is no market less likely to take a dependency on Elon).
It is ridiculous to talk about Space Twitter in the ranks of trillion dollar valuation companies:
The financial consensus seems to be Space Twitter might be worth $500 to $700 billion, using a rosy set of assumptions. With the bankers and fanboys pushing a valuation of upwards of $1.75 trillion, we can see how much is warranted by the business and how much you are paying for blind faith in Elon (and hope this isn’t another Boring Company, Cybertruck or DOGE).
Your Price-to-Elon ratios (computed by subtracting the financial value of the business from the valuation):
At $1.75 trillion, Elon is 60-71% of Space Twitter’s value
At $1.5 trillion, Elon is 53-67% of Space Twitter’s value
At $1 trillion, Elon is 30-50% of Space Twitter’s value
Invest accordingly.
Follow the CAPEX: Space Twitter
We are required by law to examine Space Twitter’s CAPEX spending, at the company level and by segment:
CAPEX for the AI segment has exploded, accounting for over 60% of spending in 2025 (with very little to show for it), even as the focus shifts from aspiring frontier model to neocloud, a business for which Elon is uniquely unsuited.
And we can compare Space Twitter to some of our favorite CAPEX spenders.
I make fun of Oracle’s CAPEX spending hereabouts as both insufficient and financially reckless, but they look better than Space Twitter.
Finally, looking at cloud/AI infrastructure spenders:
Good News for Nuclear Power, Bad News for Data Centers
Only 50 years to recover from the nuclear freakout. I’ll pencil in 2076 for the data center construction boom to really take off.
There is an alternative world where we built the 1000 nuclear plants planned in the 1970s and have abundant, clean baseload electricity to power all the things.
My proposal: 1.) would-be banners of data centers can’t use data centers, to complain about data centers or anything else and 2.) tell the agitated they’re playing into Elon’s hands by banning terrestrial data centers.
The Newspaper is Down!
Local newsletter and newspaper nostalgist The Seattle Times is struggling to print the dead tree edition so central to its self-conception.
If The Seattle Times ever succeeds in realizing their dream of the government forcing Google and Meta to subsidize their bygone way of life, they might require those companies to also throw in a few SREs.
Don’t Be Cleveland: At the Very Bottom of the Learning Curve
Not an unambiguous walk-back, but good to see our mayor is starting the remedial Mayoring 101 course. What else might she have gotten wrong? And still no word whether her parents are going to cover the reported $750 million in lost tax revenue.
Previous:
A Warning to Seattle: Don’t Become the Next Cleveland, Don’t be Cleveland: Seattle Hits New Record for Office Vacancies, Don’t be Cleveland: Credit Rating Downgrade for Washington State, Don’t be Cleveland: The Regional Homeless Authority, Don’t be Cleveland: More King Country Fraud, Don’t be Cleveland: Seattle Mayor Says Bye, Don’t be Cleveland: Seattle Mayor Retcons Her Starbucks History, Don’t be Cleveland: Snap Says “Bye Bob”, Don’t be Cleveland: Howard Schultz Says “Bye Bob”, Don’t be Cleveland: Seahawks Edition, Don’t be Cleveland: More Inebriation in Olympia, Don’t be Cleveland: Starbucks Says “Bye Bob”, Don’t be Cleveland: Amazon’s Exit, Don’t be Cleveland: Drunken State Spending, Don’t be Cleveland: Meta, Oracle, and Others Say “Bye Bob” (Ferguson), Don’t be Cleveland: What if the “Budget Emergency” was Spending, not Revenue?
Related:
Jamie Dimon: “People think that somehow being anti-business is going to help the city—it’s not”
Don’t Be Cleveland or Seattle? The Data Center Resistance
Seattle and Cleveland are converging, and not in a way that is good for either city. These are not AI data centers, They’re places for local companies to host their web sites. But still evidently the enemy!