This was not the day to be a publicly traded neocloud (as young AI data center firms are known). As the market sold off on bad inflation data—reinforcing certainty of another interest rate hike—neoclouds tanked. These companies typically are borrowing a lot to finance expansion. The worst hit in the stock sell-off was CoreWeave, whose stock fell 15.5%, fueled by chatter that its bonds were falling to worryingly low levels. CoreWeave CEO and co-founder Michael Intrator was defiant. He told his staff, according to a spokesperson: “When you are building a new type of technology company, there will be periods of time when the market misunderstands and acts irrationally.” Yeah, right. The issue may be more that Intrator doesn’t understand investors. He sold CoreWeave stock every week between April and the end of September, securities filings show, while his fellow co-founders have also been selling regularly. That can’t help but undermine investor confidence in the company. Intrator could win some brownie points by pledging to stop selling his stock for a while.
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