💩 SHITTY VENTURE CAPITAL, INC.

Investment Memorandum

RICKHOUSE, INC. ("Proof of Work")

Series Seed - $18,000,000 - July 22, 2026

NOTE: This is the first diligence memo this firm has completed in its entire operating history. We completed it because the founder brought samples.

THE COMPANY

RICKHOUSE, INC. operates a 40-megawatt data center in rural Kentucky in which the two-phase immersion cooling loop is filled, in its entirety, with 130-proof unaged corn whiskey.

The servers are submerged in bourbon. The bourbon absorbs the heat. The heat matures the bourbon. The bourbon is then bottled and sold. The company calls this "closing the loop." Our lawyers call this "several loops we should probably close."

The founder, Rye Donnelly, explained the insight in one sentence that we have been unable to stop thinking about:

"A rickhouse is a warehouse full of racks that gets hot and cold until the whiskey is good. A data center is a warehouse full of racks that gets hot and cold continuously, forever, at scale. We are not building a distillery. We already had one. We just plugged it in."

THE PRODUCT

Each GPU is a barrel. Each rack is a rickhouse. Every bottle ships with a QR code disclosing exactly which workload aged it. This is what the company refers to as silicon terroir, a term Rye invented in front of us and then defended for forty minutes.

Expression	Aged By	Tasting Notes
Single Barrel, Rack B12	One H100, one continuous pretraining run	Caramel, charred oak, thermal paste
Cask Strength	Sustained 100% utilization, no thermal throttling	Vanilla, leather, a warranty being voided
Small Batch (Inference)	Idle nodes serving a chatbot nobody uses	Thin. Watery. Honest.
The 12-Year, Aged Six Weeks	Crypto miners, briefly, before the pivot	Regret, copper, litigation
Reserve	The blade server that caught fire	Sold out permanently

UNIT ECONOMICS

The company sells compute below cost and whiskey below cost, and makes it up in the tasting room, which has a two-hour wait and no bathroom.

Evaporation loss in a traditional rickhouse is called the "angel's share." At RICKHOUSE the figure is 31% annually, which the company reports on its dashboard as Angel Investor's Share and books as a marketing expense.

RISKS WE IDENTIFIED AND THEN DECIDED NOT TO WEIGH

The coolant is 65% alcohol by volume. The fire marshal has used the phrase "the entire building is the accelerant" in writing, twice.
The TTB requires whiskey to age in charred new oak. RICKHOUSE ages it in aluminum heatsinks that it chars beforehand with a blowtorch. Legal counsel describes this as "a novel reading."
Federal law requires a bonded warehouse. The company argues the data center is "bonded compute." No regulator has agreed with this. No regulator has yet disagreed in writing, which the founder considers momentum.
Roughly 8% of the workforce is a distiller and 92% is a site reliability engineer, and both groups are now drinking on the job with a credible operational justification.
Nobody at the company can say what happens to the flavor profile when a training run diverges. We asked four times.
The product is, in the plainest terms available, a data center full of Molotov cocktails on a UPS.

RECOMMENDATION

Invest. The samples were exceptional.

We are aware that "the samples were exceptional" is not an investment thesis. We refer you to our Investment Thesis, which is vibes, and note that this is comfortably the most rigorous diligence in our portfolio's history.

Terms were memorialized on a barrel head in Sharpie, consistent with firm policy.

Warmly, and at 98 degrees Fahrenheit,
Chadwick "Chad" Burnsworth III
Managing Partner & Person of Interest

Post-close update: the Reserve expression is no longer available. The rack it was named after is also no longer available.

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