This is probably a top three surprise that I've seen in my almost 30 years. To me, it's shocking how the narrative took over to the point that investors really thought that the software space was almost done. I almost feel bad for investors personally that sell stocks on geopolitical. There'll be the doomsdayers just like what we saw with Iran in March and oil. Look how that played out. Those will have ebbs and flows, but you have to understand longer term what's happening here. And I just continue to view those as opportunities relative to our long-term view from COVID to different things we've seen in between. Tune out the noise, eye on the prize. And remember...
Well, Dan Ives, great to see you as always. Great to see you as always. Um, normally I don't need to introduce you, but you do have a new firm, Yorkville Ives. What is it? Why did you do it? And how can people learn more about it?
Yeah. So, I created Yorkville ABS in mid-July is when we announced it. And look, it's a modern merchant bank. Yeah. I found great partners. Yorkville, which is a longtime hedge fund, very successful one. People I've known personally. And it was to really break glass and build a bank focused on tech, energy, and infrastructure. And for me, after my career going back, you know, many, many years, this was the next step for me. And I'm just so excited to be doing this at this great time in the fourth industrial revolution.
Awesome. And you just got back from Nebraska. What did you see there?
Yeah, so we did a data center tour in rural Nebraska. Look, I think the reality is, and it's happened all across the Midwest. I've seen it across Midwest, Southeast, Texas, everywhere. We've got 1,000 and 1,500 data centers in motion to get built. That is the hearts and lungs of the AI revolution. Politically, you're definitely going to get into sort of a battle, a boxing match here as we go into midterms. But in my view, first time in 30 years, US is ahead of China when it comes to tech. You need to see these data centers built and they're really expanding at a, I'd say, a jaw-dropping rate.
Yeah. Yeah. Let's let's talk tech stocks in general. Um, there's been no shortage of volatility in the sector this year. Um, looking back at the year so far, what are or one or two things that surprised you the most about the tech landscape, um, so far year to date?
I think what surprised me most, and I'd say this is probably a top three surprise that I've seen in my almost 30 years in the market, was the SaaS apocalypse and how investors actually believed and sold these stocks down 50, 60, and we talked about at the time like it was the most disconnected trade I've seen in my career. Yeah. And I think now as it plays out, not just from Palantir to Snowflake to ServiceNow, now to so many others, I think that to me is shocking how the narrative took over to the point that investors really thought that software space was almost done.
Right? And obviously the the narrative seems to be changing now about the SaaS apocalypse. Tell us more about that.
Look, it remember so many investors that are bearish and they've missed every transformational growth stock the last 25 years focused on valuation. They call these stocks in from the 20 to 4, they're New York City office building. For me, three and a half million air miles later, like we see the demand, we see what's happening out there. The infrastructure led by godfather of AI Jensen Nvidia to the hyperscalers, the use cases are going to be built by software. And I'm not saying there's not software companies that going to be disintermediated, Adobe among others, but you can't just paint them all with the same brush. I think that right now is as we get into the second, third, fourth derivatives of AI, you're seeing this tech rally spread. And I think that is a very important dynamic playing out as the bears watch it from hibernation mode because they can't see AI in the spreadsheets.
Staying with software for a little bit, um, who are what are the types of companies or you could even name names, um, that are going to be the likely winners and what are the kinds of companies and who are the companies that are going to be likely losers.
Look at Palantir. I mean that's the messy of AI in terms of what they've built, right? And that's a stock that went from elementary school, you know, to a teenager to now, you know, almost $200 because they've played out the execution story. Then you look at names like Snowflake, you look at names like MongoDB, you look what's happened Cyber Security, CrowdStrike, Palo Alto among others. It speaks to my view. There will be ones Adobe into and some others that clearly have uphill battle. But you cannot just say AI is going to wipe out software.
Right. Right. And it also looks seems like, um, at at one point the market was very bearish on sort of these system of record type companies. But I think more and more people and investors are realizing that vibe coding a your own CRM is not the same thing as operating your own CRM to run a global business.
Talk to a CIO. Find but go out in New York City, find me a CIO that's going to vibe code for their organization and rip out Salesforce. If you find them, I want to be at that meeting. I think that's that's the fundamental issue. I'm not saying Salesforce has structural problems that they have to navigate in AI and Benioff knows that, right? But I think some of these valuations reflect just too much negative. But think about the narrative stories. Nvidia stock's not working. Then what could happen in the last quarter? Microsoft, you know, beast thrown in the penalty box. Now look at it.
Speaking of stocks that are not working, um, even this AI trade has had different phases, right? So AI trade wasn't hasn't been just one thing over the last call it three plus years almost four years now. Um, you know, at first it was obviously Nvidia and you know who owns the who owns the model or you know Microsoft having economic interest in in OpenAI. Then it sort of moved on to you know infrastructure then the data center build out the bottlenecks the the power the turbines the generators even networking memory. Um, what's next in terms of this AI trade phase?
