Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#1

Post by pcurve » Tue, Jan 28, 2025, 1:17 AM UTC

Why OpenAI's $157B valuation misreads AI's future (Oct 2024)
foundationcapital.com

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#2

Post by alephnerd » Tue, Jan 28, 2025, 3:46 AM UTC

Glad to finally see Ashu Garg's writings on HN.

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#3

Post by Stokley » Tue, Jan 28, 2025, 4:13 AM UTC

Whether you love or hate OpenAI, the CapEx involved with this company will be viewed as historic in the future, and will change (has already changed) the paradigm of how tech startups/projects are funded

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#4

Post by dralley » Tue, Jan 28, 2025, 4:16 AM UTC

A year ago Sam Altman was going around trying to convince people we all needed to drop 7 trillion dollars to build hundreds of fabs and nuclear power plants to fuel his AI ambitions. Only a week ago he was triumphantly announcing 500 billion dollar deals with our new President.

The (regrettably temporary) ousting of Sam Altman looks like the right call, in hindsight. Of course some amount of showmanship is expected, but the extreme nature of this self-serving BS is just laughable.

6 months from now we may be looking at Sam Altman the way we look at Adam Neumann.

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#5

Post by anotherhue » Tue, Jan 28, 2025, 4:18 AM UTC

dralley wrote: post #4

A year ago Sam Altman was going around trying to convince people we all needed to drop 7 trillion dollars to build hundreds of fabs and nuclear power plants to fuel his AI ambitions. Only a week ago he was triumphantly announcing 500 billion dollar deals with our new President. The (regrettably temporary) ousting of Sam Altman looks like the right call, in hindsight. Of course some amount of showmanship is expected,…

Reality can rarely compete with good showmanship. Weren't we discussing HyperNormalisation just yesterday?

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#6

Post by trhway » Tue, Jan 28, 2025, 4:20 AM UTC

> But while Facebook’s costs decreased as it scaled, OpenAI’s costs are growing in lockstep with its revenue, and sometimes faster

And here comes DeepSeek and takes the steam out of this and the cost arguments that follow it.

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#7

Post by coldpepper » Tue, Jan 28, 2025, 4:21 AM UTC

AI is still a fad.

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#8

Post by croes » Tue, Jan 28, 2025, 4:22 AM UTC

trhway wrote: post #6

> But while Facebook’s costs decreased as it scaled, OpenAI’s costs are growing in lockstep with its revenue, and sometimes faster And here comes DeepSeek and takes the steam out of this and the cost arguments that follow it.

Until now we know only what the they claim what that costs are.

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#9

Post by anothermathbozo » Tue, Jan 28, 2025, 4:26 AM UTC

coldpepper wrote: post #7

AI is still a fad.

How so?

Re: Why OpenAI's $157B valuation misreads AI's future (Oct 2024)

#10

Post by trhway » Tue, Jan 28, 2025, 4:28 AM UTC

croes wrote: post #8

trhway wrote: post #6

> But while Facebook’s costs decreased as it scaled, OpenAI’s costs are growing in lockstep with its revenue, and sometimes faster And here comes DeepSeek and takes the steam out of this and the cost arguments that follow it.

Until now we know only what the they claim what that costs are.

What DS did is in line with my expectations as I see a lot of performance optimizations possible at algorithmic level. So, even if the DS numbers are BS somebody else will tomorrow reach and even beat it.