Firmus Aims for $6 Billion ASX Listing Amidst Co-Founder's Past and Efficiency Claims
Firmus, a Singapore-based AI infrastructure provider, is targeting a listing on the Australian Securities Exchange (ASX) this year, with a stated valuation of $6 billion. The company was co-founded by Oliver Curtis, who was convicted of insider trading in 2016 and served a one-year sentence.
Firmus is seeking a $6 billion valuation on the ASX, raising questions about co-founder Oliver Curtis's past conviction for insider trading.
Firmus: Cooling AI Infrastructure with Major Backing
Firmus specializes in creating cooling technology for data centers that support AI infrastructure, aiming to significantly enhance efficiency. A substantial project is currently under construction in Tasmania.
The company has secured significant financial backing from a diverse group of institutional investors, superannuation funds, and prominent entities, including leading AI chipmaker Nvidia and American private equity giant Blackstone.
Firmus's ambitious Project Southgate initiative, a partnership with Nvidia and CDC Data Centres, plans to deploy 1.6 gigawatts of infrastructure by 2028. A flagship facility under this project is scheduled to open in Launceston, Tasmania, this year.
Co-Founder's Path: From Conviction to AI Pivot
Following his release from prison in 2017, Oliver Curtis co-founded e-Nome, a cryptocurrency medical start-up, with his father, Nick Curtis. E-Nome, however, did not achieve market success.
Two years later, Firmus was established by Oliver Curtis, Tim Rosenfield, and Jonathan Levee. The company initially focused on liquid cooling technology specifically for bitcoin mining operations. When bitcoin prices declined, Firmus strategically pivoted its technology towards AI data centers.
Oliver Curtis's post-conviction venture, e-Nome, failed, but Firmus later emerged, successfully pivoting its liquid cooling technology from bitcoin mining to the burgeoning AI data center market.
Ambitious Efficiency Claims Face Scrutiny
Firmus claims its proprietary liquid cooling systems offer operating costs approximately half that of competitors and build costs about 50 percent cheaper. The company reports a power usage effectiveness (PUE) of 1.1 or below at its new greenfield sites, referencing an exceptionally low figure of 1.03 for its Tasmanian operations. PUE measures a data center's energy efficiency, where a lower number indicates better efficiency. The global average PUE is around 1.5, with hyperscalers typically achieving about 1.2.
Firmus's PUE: A Global Benchmark?
Dr. Amr Omar, a senior research associate at the University of NSW specializing in data center energy systems, noted that a PUE of 1.03 is at the extreme end of what is currently possible globally. Sam Maher, CEO of GovTech Australia, expressed concerns that investors might be influenced more by the company's compelling narrative than by the actual infrastructure case.
Firmus clarified that the 1.03 statistic was a "point measurement" from a 2021 "immersion deployment" in Tasmania. The company also stated that its figures could not be independently verified by a third party due to the absence of a recognized certification body for PUE.
Investor Backing Amidst Industry Challenges
Nvidia's investment in Firmus is perceived by some as significant validation of the company's technology. However, it's worth noting that Nvidia's investment strategy includes stakes in numerous AI infrastructure companies worldwide to foster a robust ecosystem for its hardware.
Nvidia's Validation and Partner Endorsement
Greg Boorer, CEO of CDC Data Centres, a Firmus infrastructure partner, affirmed the accuracy of Firmus's efficiency and water consumption claims. He noted that CDC provides the base infrastructure, while Firmus installs its specialized cooling technology.
"CDC Data Centres CEO, Greg Boorer, affirmed Firmus's efficiency and water consumption claims, highlighting their partnership in deploying the cooling technology."
Measuring Efficiency and Rival Approaches
The data center sector currently faces a significant challenge with the absence of a single, agreed-upon method to accurately measure and compare efficiency across different providers.
Rival companies, such as Sharon AI and Southern Cross AI, employ diverse approaches to AI infrastructure. Sharon AI focuses on providing enterprise and AI-native customers with clusters and multi-year contracts, while Southern Cross AI utilizes specialized chips that do not require liquid cooling and claims higher AI output per unit of energy.
IPO Hurdles: Co-Founder's Past and ASX Character Test
Oliver Curtis's past conviction for insider trading may pose a challenge for Firmus's IPO. Under ASX guidelines, a proposed chief executive or director must meet a "good fame and character" test, which explicitly considers criminal history.
The ASX recently issued updated guidance on this test, emphasizing that the time elapsed since the offending conduct is a relevant factor. June will mark a decade since Curtis's imprisonment.
Helen Bird, a corporate governance specialist at Swinburne University, suggested that while investors might overlook Curtis's past amidst a booming AI-driven market, this sentiment could rapidly change if the company's performance begins to decline. Firmus declined to comment on questions regarding Curtis's conviction or his satisfaction of the character test.
The ASX's "good fame and character" test, which considers criminal history and time elapsed, will be a key factor for Oliver Curtis as Firmus pursues its IPO.