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OpenAI raises $8.3B at $300B valuation

nytimes.com

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Re: OpenAI raises $8.3B at $300B valuation

#91

Post by notfromhere »

lelanthran wrote: post #81
_fat_santa wrote: post #52

Given their current product offerings, I really don't see a way they could ever justify a $300B valuation unless they get everyone on the planet to subscribe to their $200/month plan. I'm calling it now: investors are gonna get burned hard on this one. Cause right now all they have is "well we are working on superintelligence" and to that I say "great, then what?". Even if they do make that breakthrough I don't see h…

Firstly, the $200/m plan is at a loss, they'll make a profit on PAYG tokens, not plans. Secondly, this is looking very risky: they are at the bottom of the value chain and eventually they'll be running on razor thin margins like all actors who are at the bottom of the value chain. Anything they can offer is doable by their competitors (in Google's case, they can even do it cheaper due to ow ing the vertical which Ope…

Maybe the better analogy for LLM businesses isn’t SaaS but more like power generation.

If AI really becomes that ubiquitous then OpenAI capturing that value is no less ridiculous than ComEd capturing the value of every application of electric power.

Re: OpenAI raises $8.3B at $300B valuation

#92

Post by chpatrick »

ozgrakkurt wrote: post #8
bix6 wrote: post #3

Nice they can poach 3 engineers back from Meta!

Out of all blockchain/AI hype bs, best thing is engineers getting rich

Just because they're both hyped doesn't mean they're the same. Blockchain has always (largely) been a solution in search of a problem but LLMs are already being used by everyone and their dog right now.

Re: OpenAI raises $8.3B at $300B valuation

#93

Post by fkyoureadthedoc »

orionsbelt wrote: post #44
fkyoureadthedoc wrote: post #19

Earlier quoted context omitted.

[flagged]

Maybe before you judge someone you should know the facts. They have basically done that, per the below statement by the rest of the family. I have a mentally ill family member and they are enormously difficult and are their own worst enemy and refuse help; there’s a reason many end up homeless. “Our family loves Annie and is very concerned about her well-being. Caring for a family member who faces mental health chall…

Where did I say what anyone else did or didn't do, or judge anybody?

Re: OpenAI raises $8.3B at $300B valuation

#94

Post by jsnell »

v5v3 wrote: post #74

What does OpenAI have over XAI to make such a difference in valuation? XAi includes x/twitter and lots of hardware and is valued at $113 billion https://www.eweek.com/news/elon-musk-xai-valuation-debt-pack...

XAI does not include Twitter, as far as I know? Aren't they separate entities? But Twitter can't be worth more than a couple of tens of billions at the most.

Things OpenAI has that XAI doesn't:

Hundreds of millions, if not already a billion, active users. A household brand-name. >$10B in revenue.

In comparison XAI's revenue appears to be in the hundreds of millions/year and their brand is currently in the gutter after the recent spate of scandals. Their main differentiating factor is using their AI to power an anime waifu[0] companion app.

[0] I don't think it's judgmental to use this term when they were doing so in their own job ad titles

Re: OpenAI raises $8.3B at $300B valuation

#95

Post by kgwgk »

Workaccount2 wrote: post #69
ahmedhawas123 wrote: post #15

So OpenAI is running at a $13B ARR, meaning this is a ~23X valuation. I don't have a good read on margin. But this would imply massive growth assumptions which I struggle a bit to understand where they come from. (1) New customers new to AI or migrations from Claude/Perplexity/Google: The overwhelming majority of people already know about the offerings, leaving most new people to come from residual people who identif…

Tech people and their friends are like 1% of the population. Go out on the the street of Anytown in any western country, and people know "ChatGPT". A friend of mine is a teacher, and told me that at a recent school board meeting there was discussion about implementing AI into the learning curriculum. And to the board, "AI" and "ChatGPT" were used interchangeably. There was no discussion of other providers or models,…

They may be satisfied with anyone’s “ChatGPT” though.

Re: OpenAI raises $8.3B at $300B valuation

#96

Post by alephnerd »

_fat_santa wrote: post #52

Given their current product offerings, I really don't see a way they could ever justify a $300B valuation unless they get everyone on the planet to subscribe to their $200/month plan. I'm calling it now: investors are gonna get burned hard on this one. Cause right now all they have is "well we are working on superintelligence" and to that I say "great, then what?". Even if they do make that breakthrough I don't see h…

> I really don't see a way they could ever justify a $300B valuation

Their ARR is around $13B. A 23x multiple is acceptable when compared against peers with a similar ARR.

> unless they get everyone on the planet to subscribe to their $200/month plan

I used to be a sceptic as well, but OpenAI successfully built their enterprise GTM. A number of corporate AI/ML apps are using OpenAI's paid APIs in the background.

Re: OpenAI raises $8.3B at $300B valuation

#97

Post by christianqchung »

v5v3 wrote: post #77
Workaccount2 wrote: post #69

Earlier quoted context omitted.

Tech people and their friends are like 1% of the population. Go out on the the street of Anytown in any western country, and people know "ChatGPT". A friend of mine is a teacher, and told me that at a recent school board meeting there was discussion about implementing AI into the learning curriculum. And to the board, "AI" and "ChatGPT" were used interchangeably. There was no discussion of other providers or models,…

More than just tech people on X and they all know Grok. I imagine Meta users know Llama too?

Facebook users do not know Llama anywhere near the degree the X network does Grok, and both are pallid in comparison to Chatgpt.

Re: OpenAI raises $8.3B at $300B valuation

#98

Post by antonvs »

skeptrune wrote: post #87
_fat_santa wrote: post #52

Given their current product offerings, I really don't see a way they could ever justify a $300B valuation unless they get everyone on the planet to subscribe to their $200/month plan. I'm calling it now: investors are gonna get burned hard on this one. Cause right now all they have is "well we are working on superintelligence" and to that I say "great, then what?". Even if they do make that breakthrough I don't see h…

What are you talking about? All they have to do is sell ads at this point

As a large language model, I cannot help you with your request, but have you heard about the latest Starbucks Summer Frapulaccini?

Re: OpenAI raises $8.3B at $300B valuation

#99

Post by nzealand »

lelanthran wrote: post #81
_fat_santa wrote: post #52

Given their current product offerings, I really don't see a way they could ever justify a $300B valuation unless they get everyone on the planet to subscribe to their $200/month plan. I'm calling it now: investors are gonna get burned hard on this one. Cause right now all they have is "well we are working on superintelligence" and to that I say "great, then what?". Even if they do make that breakthrough I don't see h…

Firstly, the $200/m plan is at a loss, they'll make a profit on PAYG tokens, not plans. Secondly, this is looking very risky: they are at the bottom of the value chain and eventually they'll be running on razor thin margins like all actors who are at the bottom of the value chain. Anything they can offer is doable by their competitors (in Google's case, they can even do it cheaper due to ow ing the vertical which Ope…

The real revenue opportunity for OpenAI is advertising. More than 25% of Americans use ChatGPT instead of Google, and OpenAI has already announced partnership with Shopify to directly list products. But for now they are focused on market share.

Google does not really own the complete AI stack, NVDA is extracting a lot of the value there.

Google has two other impediments to doing what ChatGPT does.

Googles entire business model is built around search. They have augmented search with AI, but that is not the same as completely disrupting an incredibly profitable business model with an unprofitable and unproven business model.

Also... Americans are in the habit of going to ChatGPT now for AI. When you think of AI, you now think of ChatGPT first.

The real risk is we are at the tail end of a long economic boom cycle, OpenAI is incredibly dependent on additional funding rounds, and if we recess access to that funding gets cut off.

Re: OpenAI raises $8.3B at $300B valuation

#100

Post by antonvs »

jamespo wrote: post #32
paulcole wrote: post #27

Earlier quoted context omitted.

Why do you want to reward effort? I’ll just push a boulder uphill all day and accomplish nothing and then come with my hand out. Also, in your opinion what is the correct proportion of wealth received to legitimate, valuable effort, and vision contributed? I’d love an answer that is an integer percentage, like “43%.”

Makes a change from rewarding the luck of being in the right place at the right time

Which includes having the right sort of parents
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