Nvidia's new financing partnerships with major financial institutions will alleviate the capital constraint on AI infrastructure buildout, potentially making Nvidia the central bank of AI by providing residual value guarantees and revenue-sharing arrangements.
Nvidia's financing partnerships create a new asset class for AI compute, solving the capital constraint problem for massive infrastructure buildouts. ✦ AI generated
Gavin Baker · All-In Podcast · 2026-08-14 · original ↗
starts at this moment · 60:00
What he's doing is alleviating that finance constraint so that he can grow uh as big as the the the TAM actually is right is removing that constraint. So for just to take one example Elon wants to add somewhere around 6 to8 gawatt next year. We know that that would cost 3 to400 billion of capex. The company just raised 100 billion in its equity and debt offerings. So obviously they would have to go out and finance that somehow. And as we talked about in our previous episode, the simplest way to finance it would be to get seller financing from Nvidia, especially given that the payback period could be as quick as one year. So now Jensen is creating the you could say the line of credit using these big banks, using these big private equity shops, and he's making that available, and that's going to now benefit all of these downstream purchasers.
verbatim transcript · starts at 60:00
59:59essentially validate this market. And Nvidia is being a matchmaker. And what they're basically saying is, hey, our compute, because it's so flexible, is going to have a long enough life that you can finance it at lower rates than other um kinds of compute. And I think and I think that's that that's smart. That's good for everyone. And it is interesting if you look at the underlying architectures of the three
60:23what I call big Chinese open source models and maybe even throw a few or four you know if we have um Quinn if we have Kimmy if we have DeepSync um and then we have GLM they're actually evolving in very different ways and that architectural variation works in Nvidia's favor and in GPU's favor um because it means that you do need this more flexible compute to be able to
60:50finance it to be able to think that you can have a long life. But what what Nvidia is doing that I think is really smart is they're saying hey we are going to help create this market grow this market but what they're going to provide two very important functions they're going to say hey um Blackstone Goldman Sachs KKR Apollo Black Rockck um I'm leaving someone out and I'm so sorry
61:18there are six of them come to us if you have a deal you can bring it to us and we will give a residual value guarantee and I think the way that that residual which will further lower the cost of financing these and that residual value guarantee can then be incorporated into those companies underwriting and what that basically means is they're saying that after 3 years four years we
61:48guarantee that these GPUs can be rented at a certain rate and then the risk that they are bearing is the risk between that that value um and wherever the market rate is and right now everything's going straight up Nvidia has better telemetry than almost anyone and to the supply and demand of compute so they can put that at a very very smart place um further make it
62:17financable you're risking you know they're only bearing ing 25% of the risk the world's some of the world's smartest underwriters you know in terms of reputation >> what could go wrong Gavin I mentioned mortgage back securities etc and obviously the lifespan is the key issue here um the different hyperscalers were saying hey four five six years Amazon and the big debate happened but what we've seen is to your point with the