Please help interpret the Birthday effect as described in Wikipedia:

A birthday attack works as follows:

1. Pick any message m and compute h(m).
2. Update list L. Check if h(m) is in the list L.
3. if (h(m),m) is already in L, a colliding message pair has been found. else save the pair (h(m),m) in the list L and go back to step 1.

From the birthday paradox we know that we can expect to find a matching entry, after performing about 2^(n/2) hash evaluations.

Does the above mean 2^(n/2) iterations through the above entire loop (i.e. 2^(n/2) returns to step 1), OR does it mean 2^(n/2) comparisons to individual items already in L.