Deep Sail Capital
Founder & CIO of Deep Sail Capital, Long/Short GARP, Quality/Growth/Micro-Caps
Rumble's management keeps chasing trends through heavy share dilution, making it hard to trust. Its Tether crypto deal diluted shareholders by 100 million shares and its Northern Data acquisition for data centers by 120 million. It is now offering a counterparty 50 million shares via warrants struck at $0.01 just for a commercial deal to buy its GPU services. x.comÂ
Rumble is highly likely headed toward zero rather than back to the 25x ARR valuation @blubercap mentions. x.comÂ
Ondas's share-funded acquisitions look very risky without a strong core business to make them work. It has raised $1.8B selling shares, yet roughly $1.4B sits in cash and short-term investments. One customer provides 55% of revenue, and $252M plus $742M in stock spent on acquisitions has not produced big revenue; continued raises and management pay add to the concern. x.comÂ
Rumble's slide into the $7s ignores a known deal, now that Anthropic is revealed as its mystery compute customer. Per The Information, Anthropic signed a six-year, $13.7B agreement to lease AI compute from RUM Group's Maysville, Georgia data center, which has 120 MW of secured grid power, against just $40.4M of Q2 revenue. x.comÂ
CoreWeave's losses, high debt and rising share count make it look like one of the worst things to buy. Sales have grown sharply, but earnings and returns on capital remain negative. x.com x.comÂ
Rubrik belongs in the too-hard pile until it proves it can make money and stop diluting shareholders. @InvestingVisual notes that net losses, dilution and stock compensation as a share of revenue are shrinking each quarter, but trending in the right direction is not good enough for a large investment; continued proof over time could prompt a rethink. x.com x.comÂ
Rumble could highlight its Northern Data AI cloud business aggressively, given past talk of a $16 billion spinoff of the Taiga Cloud unit. Northern Data reportedly planned that spinoff when its own market cap was about $1.5 billion in July 2024, and Rumble's prospectus for the acquisition centers on power and Nvidia GPUs. x.com x.com x.comÂ
C3is is likely to run another round of death-spiral financing once its new shares lift the market cap enough to repeat the process. Class F holders converted and sold zero-cash-exercise shares, getting four for each warrant, so the real conversion price was a fifth of what it appeared, and the company could again find a way to 10x the common share count. Per @ej23ny, the CFO said $48M on hand covers $38M of January payments, with $26M of annual cash generation. x.com x.com x.com x.com x.com … Show more
Bakkt has destroyed shareholder value through dilution, falling from $40 to under $8. A reply the author answers adds that despite NYSE backing and $3.5 billion in revenue, management diluted retail with ATMs and burned $40 million a quarter. The same accounts that once promoted Bakkt now defend IREN's $6 billion dilution. x.comÂ
Ondas Holdings and Archer Aviation are dead money because endless dilution has outpaced their hot stories. Ondas shareholders haven't made a buck all year as dilution inflates its market cap, and a $460M backlog, even if fully realized, is thin against a roughly $6B market cap. Archer went the same way, climbing on a red-hot story until billions in dilution left enthusiasm unable to keep pace. The biggest cost is opportunity cost in one of the hottest markets of a lifetime. x.com x.comÂ
Snap is an eternal value trap: cheap on paper, but weighed down by regulatory headaches, TikTok eating its lunch and endless dilution. x.comÂ
