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Sam Altman's Bubble Talk Bet Is 1 Year Old

blog.samaltman.com

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Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#21

Post by david927 »

KKKKkkkk1 wrote: post #18

TLDR: Venture capitalist claims the tech sector is not in a bubble.

Exactly. To be fair, it's pretty hard to remain objective in his spot. If he spent a year anywhere else in the world, doing something different, he would certainly have a different perspective. But that's fine. He should feel the way he feels about this.

I was going to make a similar bet but in the other direction. My instincts say that 90% of the companies mentioned would be out of business by then and the remaining in the "still-going-but-not-relevant/MySpace" category. The coming Tech Winter will be devastating to the unicorns, precisely because so much is expected from them.

But I don't want to be one of those people. A community is built by people supporting each other, up or down, Tuesday or Wednesday. Maybe Sam is right and maybe I am, but at the end of the day, let's innovate and let the future unfold how it will.

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#22

Post by NumberCruncher »

projectramo wrote: post #4

Here are his three bets reproduced for comments: 1) The top 6 US companies at http://fortune.com/2015/01/22/the-age-of-unicorns/ (Uber, Palantir, Airbnb, Dropbox, Pinterest, and SpaceX) are currently worth just over $100B. I am leaving out Snapchat because I couldn’t get verification of its valuation. Proposition 1: On January 1st, 2020, these companies will be worth at least $200B in aggregate. Seems he is on track…

Basecamp is now a $100 billion dollar company, according to a group of investors who have agreed to purchase 0.000000001% of the company in exchange for $1.

Source: https://m.signalvnoise.com/press-release-basecamp-valuation-...

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#23

Post by mikeryan »

projectramo wrote: post #4

Here are his three bets reproduced for comments: 1) The top 6 US companies at http://fortune.com/2015/01/22/the-age-of-unicorns/ (Uber, Palantir, Airbnb, Dropbox, Pinterest, and SpaceX) are currently worth just over $100B. I am leaving out Snapchat because I couldn’t get verification of its valuation. Proposition 1: On January 1st, 2020, these companies will be worth at least $200B in aggregate. Seems he is on track…

I think #1 is actually the toughest bet. I can see Palantir, Dropbox and Pinterest either remaining static or even dropping from their current valuations. Even Uber and Airbnb don't have a clear path to huge growth in front of them, Airbnb is the safer bet for growth because of the lack of competition. Uber still seems a strong business but I'm not sure how well they continue to grow. X-factor for Uber is how it well it expands into complementary product verticals like self-driving cars, deliveries etc.

SpaceX could end up carrying this category.

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#24

Post by sama »

I feel better about this now than I did a year ago. Proposition 1 is up about 50% in the first year, and proposition 2 is up about 65%.

The main point remains--we spend far too much time talking about whether or not startups are in a bubble. It's boring and it gets in the way. Sometimes it will be true and sometimes it won't, but the stories claiming a huge bubble for the last 10 years have been generally wrong.

It was telling to me that, even with the fever pitch of VCs calling for the end of the world last year, only one investor (a TechStars mentor) would take this bet.

The goal of this bet was to deflate the bubble conversation, and that seemed somewhat effective.

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#25

Post by etjossem »

NumberCruncher wrote: post #22
projectramo wrote: post #4

Here are his three bets reproduced for comments: 1) The top 6 US companies at http://fortune.com/2015/01/22/the-age-of-unicorns/ (Uber, Palantir, Airbnb, Dropbox, Pinterest, and SpaceX) are currently worth just over $100B. I am leaving out Snapchat because I couldn’t get verification of its valuation. Proposition 1: On January 1st, 2020, these companies will be worth at least $200B in aggregate. Seems he is on track…

Basecamp is now a $100 billion dollar company, according to a group of investors who have agreed to purchase 0.000000001% of the company in exchange for $1. Source: https://m.signalvnoise.com/press-release-basecamp-valuation-...

You do know that post is one big "valuations are high and we are in a bubble" joke, right?

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#27

Post by rco8786 »

neom wrote: post #7

He'll likely be right on all 3 but only because 1 company in each will disproportionately skew. His bet is overly broad. Palantir and SpaceX are very promising companies, it's hard to say if their true value will be realized by 2020. Stripe alone is worth $10-15B if you ask me. Where he might stumble is the 3rd, however finding $3B of worth in what must be 30+ companies shouldn't be hard, depends how badly the global…

> 1 company in each will disproportionately skew.

He's a VC, that's what he's betting on.

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#28

Post by vkou »

projectramo wrote: post #4

Here are his three bets reproduced for comments: 1) The top 6 US companies at http://fortune.com/2015/01/22/the-age-of-unicorns/ (Uber, Palantir, Airbnb, Dropbox, Pinterest, and SpaceX) are currently worth just over $100B. I am leaving out Snapchat because I couldn’t get verification of its valuation. Proposition 1: On January 1st, 2020, these companies will be worth at least $200B in aggregate. Seems he is on track…

A single bad IPO from that list of firms (Which will likely happen in a climate of pessimism, even if we don't hit a recession) will be disastrous to their aggregate valuation, even if they stay private.

I feel that the only way Sam will win the bet is if none of the firms in #1 or #2 will IPO between now and 2020.

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#29

Post by reitzensteinm »

NumberCruncher wrote: post #22
projectramo wrote: post #4

Here are his three bets reproduced for comments: 1) The top 6 US companies at http://fortune.com/2015/01/22/the-age-of-unicorns/ (Uber, Palantir, Airbnb, Dropbox, Pinterest, and SpaceX) are currently worth just over $100B. I am leaving out Snapchat because I couldn’t get verification of its valuation. Proposition 1: On January 1st, 2020, these companies will be worth at least $200B in aggregate. Seems he is on track…

Basecamp is now a $100 billion dollar company, according to a group of investors who have agreed to purchase 0.000000001% of the company in exchange for $1. Source: https://m.signalvnoise.com/press-release-basecamp-valuation-...

This is a trite complaint, and in my view, misses what is often bogus about the lofty valuations - liquidation preferences provide a lot of downside protection.

For instance, if I invest $1bn in Uber at a $10bn post and a 1x preference, I get the first $1bn of any sale. Yes, I invested at a $10b valuation, but I don't actually lose any money unless the valuation sinks below $1bn.

This is a much better deal than simply paying $1bn for 10% of Uber, and in my view, actually does not imply a $10bn valuation at all.

Re: Sam Altman's Bubble Talk Bet Is 1 Year Old

#30

Post by x1798DE »

blowski wrote: post #11
projectramo wrote: post #4

Here are his three bets reproduced for comments: 1) The top 6 US companies at http://fortune.com/2015/01/22/the-age-of-unicorns/ (Uber, Palantir, Airbnb, Dropbox, Pinterest, and SpaceX) are currently worth just over $100B. I am leaving out Snapchat because I couldn’t get verification of its valuation. Proposition 1: On January 1st, 2020, these companies will be worth at least $200B in aggregate. Seems he is on track…

> I think this underscores how long 5 years is in internet time. You're absolutely right. The 10 biggest tech stories of 2011 http://edition.cnn.com/2011/12/26/tech/web/tech-news-2011/in...

I'm not sure I understand, those stories don't seem to bolster your point - a few of them are one-time events (Steve Jobs' death), and most of them are still ongoing concerns - hackers, facebook, etc.

I probably agree that 5 years is a long time in tech, but some variation on almost all those stories could easily be published today.

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