Pulse News

**Inside the Start of Project Stargate—and the Startup Powering It**

By Abram Brown

Mar 7, 2025, 9:51am PST

Art by Clark Miller

Crusoe is little known outside data center land, but it's fast growing. Its young, Musk-loving, Everest-climbing CEO has positioned the company to define the $500 billion binge on AI.

On the barren outskirts of Abilene, Texas, traffic had snarled to a crawl: It was shift-change time at Project Stargate, and as several hundred workers drove off the 800-acre site that contains the debut Stargate data center, plumes of dust from the red clay dirt followed the caravan of pickup trucks out of sight. Even without the oxidized haze, no one would've had their windows open. On this early evening in February, the thermometer hovered around 90 degrees.

Regardless of time or temperature, work here goes on 24/7, which is exactly as Crusoe CEO Chase Lochmiller wants it. "This was all trees and shrubs back in June last year. And since then we've had 1.2 million man hours worked on the site," Lochmiller said. "There's a lot of activity here."

Off in the distance: a pair of H-shaped buildings, each partially completed—the actual $3.4 billion data center Crusoe has custom-designed for Oracle and OpenAI as part of Stargate, an initiative that will involve a $500 billion expansion in AI infrastructure that the companies announced with Donald Trump at the White House on the second day of his new administration. Lochmiller anticipates they'll have the power at the site fully turned on by June, concluding in about a third of the time that many such projects can take. (His co-founder, Cully Cavness, has considered whether they might somehow qualify for a Guinness World Records entry.)

To traverse the site, we sat scrunched together in the back seat of a little dune buggy, the quickest way to get around. ("Just like 'Jurassic Park,'" Lochmiller had remarked when we'd set off an hour or so earlier.) When a brief pause in traffic came, the driver, Lionel Branscomb, the site's chief superintendent, darted the buggy forward. A few minutes later, we came to another halt. We had taken a wrong turn, Branscomb admitted.

"One of the problems about having a project moving this quickly is that getting around the site changes," Lochmiller said. "If you leave for a week, the roads are different."

More broadly speaking, Lochmiller and Crusoe certainly do find themselves at a unique intersection, where many of the pivotal elements of this era of technology have come together: artificial intelligence, data centers, crypto, energy, and Trump—to assemble just a short list. And as such, Lochmiller presents a rather distinctive personification of this heady moment in time.

Crusoe's specialty is designing, building, and managing data centers in out-of-the-way places near untapped energy sources. Initially, Lochmiller, 38, and Cavness, 37, built data centers and used them to mine bitcoin. Now companies like Oracle want Crusoe to construct data centers for them; Crusoe will own the centers, and the companies will lease them. As Crusoe's focus has shifted, the startup has become highly valued, fetching a $2.8 billion price tag in its latest funding from December that attracted a slew of boldface investors, including Founders Fund, Nvidia, Fidelity, and Mubadala, an Abu Dhabi sovereign wealth fund. And Crusoe is growing fast. It finished 2024 with nearly $300 million in revenue—roughly tripling its sales from a couple of years ago and expects "significant growth" this year, Lochmiller said.

Those numbers could get much larger if everything goes according to plan in Abilene. Data centers are as essential to AI as Henry Ford's assembly line was to the explosion in automobiles a century ago. And Lochmiller envisions Abilene as a new model for the entire industry: a showcase of how to build a data center at a breakneck pace near a source of affordable power in parts of the country that are happy to host new-age industrialists in their backyards.

Should Lochmiller pull it off, Crusoe could have a defining role in the AI boom—and a chance to drink heavily from Stargate's deep well of funding. Just the scale of economics around Abilene is enormous, and Lochmiller made sure I understood that by comparing it to a familiar sight: Marc Benioff's billion-dollar skyscraper in downtown San Francisco. "In the Bay Area, the Salesforce Tower defines the city skyline, right?" he said. "You take three Salesforce Towers, and that's the amount of work that's going on here."

Ever since President Trump and Oracle Chair Larry Ellison highlighted the Abilene data center at the Stargate press conference in January, Crusoe has faced the burden of sudden fame: a steady stream of curious onlookers arriving, hoping for a better view of what the president and the billionaire had talked about. "The project was kinda under wraps, then this big thing happened at the White House," Lochmiller said wryly. "And suddenly Abilene was catapulted onto the front page." (Work and planning at Abilene obviously began much before the public Stargate announcement.) More interest came after Sam Altman tweeted a drone-shot video of the site. As a result, Crusoe had to tighten on-site security, and an unexpectedly locked gate was partly the reason we'd gotten turned around in the buggy.

Why exactly did Crusoe pick this spot in West Texas? Well, once completed, the data center can house 100,000 Nvidia-made GB200 chips, the lifeblood of artificial intelligence. They require an enormous power, and in total, the data center will guzzle 300 megawatts of electricity. That's several orders of magnitude more energy than data centers required a decade ago back when older, less sophisticated chips needed far less power. At the moment, the AI industry has an unquenchable demand for these data centers, without which it can't develop projects like ChatGPT. And the ability to construct these centers quickly has turned into a matter of national importance as America races to maintain its dominance over AI.

So given that great demand for massive power pronto, a place like West Texas makes sense. While data center construction can sometimes encounter a mountain of red tape that takes years to clear, local and state officials couldn't have been happier to see Crusoe arrive in Texas. "Texas is a place that's very pro-business: They're easy to work with, invited us in, and helped us move through the process," said Cavness, the Crusoe co-founder. "And there is abundant energy."

The Abilene data center will draw from the main Texas energy grid, and Crusoe plans to take a portion of that energy from local wind farms, which tend to have an abundance of unused power. (Lochmiller wouldn't comment on precisely how much.) In some cases, these farms have previously faced such a supply-and-demand imbalance that they've sat unused for lengthy periods of time to avoid operating at a loss.

The ability to identify parts of the country with underutilized energy sources is one part of Crusoe's appeal to Oracle (which will lease the data center from Crusoe and provide OpenAI with access to the servers). Another part is even more straightforward: The startup promised to finish the data center quickly. Plenty of companies in America can build a data center, but the large cloud firms such as Amazon and Microsoft just "aren't as nimble," said Bob Wobschall, who tracks the data center world as an executive vice president at CBRE, the real estate services firm. "They might have the budgets for massive capital deployment, but they don't have the speed."

Some of Crusoe's speed comes from the fact that it can supply many of the components needed for the center itself like the switchgear that acts as a giant power panel and the telephone booth-size power distribution centers, which help regulate energy flow—through its own manufacturing facilities in Tulsa, Okla. (This helps it avoid at least some of the supply-chain kinks that can plague data centers.) As much as possible, Crusoe has assembled the center modularly, prioritizing finished components that can arrive ready to fit together "like Lego blocks," Lochmiller said.

For much of Crusoe's operations, Lochmiller has drawn inspiration from one chief source: Elon Musk. He idolizes Musk as some young film director might worship at the altar of Spielberg or Tarantino, and he has closely studied how Musk's companies operate, a reflection of what could be one of the most durable elements of Musk's legacy—his status as a lodestar for an entire generation of young entrepreneurs eager to emulate him.

Initially, Lochmiller had hoped Musk's XAI would be the one to join Oracle at the Abilene data center. The conversations ended abruptly last year after Musk broke them off; in turn, he rapidly converted an existing industrial building in Memphis into a data center in 122 days. The scuppered deal hasn't altered Lochmiller's admiration for Musk, and in Abilene, he has instilled Musk's around-the-clock attitude toward work. While some competitors' employees might do a 10-hour day, "we'll use the other 14 hours, too," he said with obvious pride. "We'll be pouring concrete at three in the morning." And while a rival might work five days a week, "we work the other two days," too, he said.

Internally, the original name for the Abilene center was Project Ludicrous because Lochmiller wanted to operate at "ludicrous speed," he said. The name is a reference to the 1987 comedy "Spaceballs," a favorite of Musk, and Lochmiller chose it as a nod to Musk, not because he has any special fondness of his own for the movie. "Haven't seen it since high school," he conceded.

For the past several years, JB Straubel, a Tesla board member and the company's former chief technology officer, has been a Crusoe investor and has counseled Lochmiller on the business and how to emulate Tesla. "I love that whole ecosystem of entrepreneurs being underdogs and trying to do crazy things," Straubel said. "It makes me happy we could be a beacon....I feel an almost parental source of pride."

Even the Abilene site's chief superintendent, Lionel Branscomb, comes from Musk world, having spent several years at Tesla in Texas. He thinks Lochmiller has embraced just the right amount of Musk ethos. Undiluted Elonism has some drawbacks, he acknowledged. "Elon is really high intensity—high expectations," which can motivate people, Branscomb said. "But it comes at the expense of your sanity."

Lochmiller even approaches his chief pastime with Musklike intensity. A Colorado native, Lochmiller is a fanatical hiker, and he has completed five of the Seven Summits, the world's tallest peaks. Everest took him two tries: His first failed in 2014, and then after quitting a quantitative-trading job, Lochmiller tried Everest again four years later. For the trek, he brought along a Kindle stocked with a Haruki Murakami novel; Vladimir Nabokov's "Lolita," which he found "pretty weird," he said; and Ray Kurzweil's "The Singularity Is Near," which he liked quite a lot. Lochmiller, who has a master's degree in computer science from Stanford, returned home with his thoughts dwelling partly on Kurzweil's prediction that humanlike AI would arrive imminently.

Still, such a scenario wasn't happening the very next day, and on another hiking expedition across two of Colorado's 14,000-foot-plus peaks, Lochmiller and Cavness, whom Lochmiller had known since high school, discussed a concept for a company that could take immediate advantage of immense advancements in chips and computing. Cavness had studied the economics of the energy industry at Middlebury College and later at Oxford University, and he and Lochmiller thought melding their backgrounds together would make a fortuitous combination. The talk of a startup dominated their trip. "By the end of climbing those mountains, we were both pretty excited," Cavness said.

No matter what they did with the chips, they would need access to power, and Cavness suggested they take advantage of the leftover natural gas often burned off in flares in remote locations. Since the natural gas producers had no use for it, they'd be willing to sell the energy for cheap. Cavness and Lochmiller figured they could use the power and the chips for bitcoin mining, and if they could set up the chips within small, modular data centers close to the turbines fueled by flared natural gas, they'd have lower costs than other miners.

Their first such data center roared to life in North Dakota around 2019, much to the shock of the local gas-field roughneck who helped them get up and running. "He looked around at all of our computers, and then looked at us and asked, 'You're not Russians, right?'" Lochmiller recalled. During the couple years of crypto mania that followed, Crusoe expanded to nearly 100 of these natural gas-powered data centers, attracting investors like the Winklevii and Chris Sacca's Lowercarbon Capital, which especially appreciated Lochmiller's and Cavness' desire to go beyond bitcoin. "Back then, you might've concluded, 'Oh, this is a bitcoin company,'" said Clay Dumas, a founding partner at Lowercarbon. "And, ultimately, that would've been wrong."

A couple years ago, Crusoe began selling cloud computing services from its modular data centers, and the diversification of that revenue helped cushion the blow dealt by the downturn in bitcoin prices. Ultimately, the combination of experience in both hunting out unique energy sources and data center construction made Crusoe an appealing partner for Oracle several years later. As Dumas put it: "A great company is always a combination of foresight of where the world is heading, lots of luck, and riding the wave."

When I arrived in Abilene late on a Sunday, I didn't notice a soul anywhere downtown, and when I asked the receptionist at the DoubleTree hotel whether I could leave my car parked on the street, she couldn't help but laugh: Yes, this was a quiet part of a quiet city. "But this is a town that's about to boom," she said with sunshiney brightness. Her optimism caught me slightly by surprise, and I asked what made her so confident. "Well, the big data center they're building," she said.

The exchange underscored a relatively little-discussed element to Stargate specifically and the entire AI infrastructure boom more broadly. Obviously, it could have profound significance for the technology industry. It could also bring tremendous economic development to areas of America that have seen little of it in generations—especially if Crusoe's model prompts other projects in frontier corners near large supplies of energy.

Lochmiller envisions Stargate and Crusoe ushering in "a new version of the New Deal," he said. "There is a really cool story here around just what AI means for the blue-collar economy. We have 1,000 people onsite every day. Those are all new jobs that are entirely created by the AI revolution."

In Abilene, the project could add about $1 billion in tax revenue to the area over several decades, according to an estimate by local officials. Some of those dollars, of course, will get distributed in small ways: In November, for instance, Crusoe had a celebratory topping-off ceremony—a long-held custom in construction to mark the placement of the site's highest beam—with a party that concluded late into the evening at the Ugly Lime. "A funny little dive bar," Lochmiller said. "Plenty of tequila." (As one other Crusoe executive recalled: "All the expensive stuff has dust on it.")

Within a year, Crusoe hopes to expand the Abilene center's power capacity to more than 1 gigawatt—roughly enough power for four Abilene-size cities—and work has already commenced on a natural gas turbine to make that increase possible. Lochmiller has already received interest for data centers as large as 5 gigawatts, and it has prompted him to think even more imaginatively about where to find that energy, including possibly hydroelectric power.

I started to do the mental math on how much money a 5 gigawatt data center would cost. Before I could finish, Lochmiller assured me it would be entirely doable especially given Stargate's ambitions. "Well, I've heard that someone's got $500 billion for me," he said.