XAI seeks up to $200B valuation in next fundraising

Post by seydor » Sat, Jul 12, 2025, 5:07 PM UTC

lemoncookiechip wrote: post #4

I find it odd that investors are still so motivated to drop money into AI, specifically LLMs, not because I don't see value in the technology, I do, but because it feels to me like it only takes a few months (if that) for your company which might currently dominate with the leading product, to be left behind by someone else who just came out with a better, cheaper, and faster product. I guess this is true for most te…

Post by blitzar » Sat, Jul 12, 2025, 5:20 PM UTC

klodolph wrote: post #10

lemoncookiechip wrote: post #4

I find it odd that investors are still so motivated to drop money into AI, specifically LLMs, not because I don't see value in the technology, I do, but because it feels to me like it only takes a few months (if that) for your company which might currently dominate with the leading product, to be left behind by someone else who just came out with a better, cheaper, and faster product. I guess this is true for most te…

My top suspicion is that xAI’s valuation is more about moving money around and less about belief in the actual underlying xAI projects.

Post by Aurornis » Sat, Jul 12, 2025, 5:24 PM UTC

Retric wrote: post #7

lemoncookiechip wrote: post #4

I find it odd that investors are still so motivated to drop money into AI, specifically LLMs, not because I don't see value in the technology, I do, but because it feels to me like it only takes a few months (if that) for your company which might currently dominate with the leading product, to be left behind by someone else who just came out with a better, cheaper, and faster product. I guess this is true for most te…

Yea, I don’t think investors really internalize that LLM companies have effectively zero moat. Customers can easily jump ship. Everyone is using effectively the same compute, nearly identical training data, very similar algorithms, etc. Worse past investments in a model become outdated quickly.

Post by coderatlarge » Sat, Jul 12, 2025, 5:26 PM UTC

lemoncookiechip wrote: post #4

I find it odd that investors are still so motivated to drop money into AI, specifically LLMs, not because I don't see value in the technology, I do, but because it feels to me like it only takes a few months (if that) for your company which might currently dominate with the leading product, to be left behind by someone else who just came out with a better, cheaper, and faster product. I guess this is true for most te…

Post by ketzo » Sat, Jul 12, 2025, 5:30 PM UTC

Aurornis wrote: post #16

Retric wrote: post #7

Earlier quoted context omitted.

Yea, I don’t think investors really internalize that LLM companies have effectively zero moat. Customers can easily jump ship. Everyone is using effectively the same compute, nearly identical training data, very similar algorithms, etc. Worse past investments in a model become outdated quickly.

I think Hacker News readers underestimate how sticky the typical customer is. The average subscriber to these services isn’t following a constant stream of LLM news and jumping from platform to platform every time the leaderboard changes slightly. The average customer signs up and then inertia and familiarity take over. They stay signed and comfortable.