The Three-Year Silicon Clock: How to Think About AI Capital Expenditure Without Getting Burned
Venture debt and sovereign funds have poured hundreds of billions into hardware clusters. But when silicon depreciates on a 36-month half-life, the software layer must generate cash flow or face insolvency.
Core Principle: Unless your core business is selling electrical compute by the megawatt, purchasing custom GPU hardware is an operational trap. The durable competitive advantage is domain workflows, not transient silicon.