Earlier quoted context omitted.
And what's the profit on the 13B?
Irrelevant at this stage.
the problem with the post-dotcom market in a nutshell. everything’s a bubble. bubbles have more durability now. until they don’t.
OpenAI raises $8.3B at $300B valuation
191–200 of 294 posts
Re: OpenAI raises $8.3B at $300B valuation
#192Earlier 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,…
> When average people are asked to reach for AI, they reach for ChatGPT. No, average people are nowhere near that tech-savvy. Just because every mom in the 90s called every video game console a "Nintendo" did not mean that Sony didn't mop the floor with Nintendo in that era. This isn't brand loyalty, it's brand genericity. Other than, say, Replika-style users who have formed an emotional bond with a certain style of…
Except Open AI happen to be the Sony in this case. 700M Weekly active users and the 5th most visited site on the planet, with no-one else close. I mean, it's pretty clear this is less 'Nintendo' and more 'Google'.
Re: OpenAI raises $8.3B at $300B valuation
#193Given 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…
You have to look at Palantir revenue and market cap to justify this. Palantir is around $1B in revenue and around 350B market cap. They build AI solutions for the government. I think OpenAI has something similar in mind. They got the AI part and the government contract part and now just need to capitalize on it. Also from what I have heard, they are at $5B in revenue anyway.
Re: OpenAI raises $8.3B at $300B valuation
#194What 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...
Does xAI have a similar amount of revenue/customers? (I've personally never heard anyone talk about using it -- except on Twitter.)
Re: OpenAI raises $8.3B at $300B valuation
#195They haven’t released a new model in ages and their research seems dead in the water. People are going to get burned on all these meme stocks.
Re: OpenAI raises $8.3B at $300B valuation
#196Given 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…
Just picking a semi-related stock, NVDA trades at ~30x gross revenue, so a $300B "only" translates into ~$10B in revenue. And OpenAI can ask for a better multiplier because I'm sure they're forecasting a ton of growth and a ton of cost savings.
NVDAs valuation is insane. At 30X revenue, they could double sales and reduce expenses to zero and they'd still need a story about future growth to justify the valuation.
Consider this: Nvidia doesn't do the manufacturing, just the engineering. If we had AI super intelligence, you'd just need to type "give me CUDA but for AMD" into chatGPT and Nvidia wouldn't be special anymore. Then someone at TSMC could type "design a gpu" and the whole industry above them would be toast.
There's no reason to expect an engineering firm to win if AI commoditizes engineering. It's very possible to change the world and lose money doing it.
Re: OpenAI raises $8.3B at $300B valuation
#197They haven’t released a new model in ages and their research seems dead in the water. People are going to get burned on all these meme stocks.
How weird would it be though if OpenAI actually did go under. So many things are now built on top of this thing. Is it only really economically viable because it’s being subsidised by generous venture caps?
Re: OpenAI raises $8.3B at $300B valuation
#198300 billion is completely absurd
Re: OpenAI raises $8.3B at $300B valuation
#199Earlier quoted context omitted.
Yes, and they have a monopoly on the ad market. Whereas a SOTA LLM can be used to bootstrap an almost-as-good LLM. The gap is shrinking between SOTA models and there's now fierce competition. Moreover, ads are a very high ROI business. The profit margins on SOTA LLM offerings are razor thin or negative.
> they have a monopoly on the ad market Only if you look narrowly at search ads, but really they compete with Meta, Tiktok and X for ad spend. And the quality of the LLMs is beside the point, just like search engine quality. ChatGPT has a near monopoly on 'AI' mindshare, with the general public.
What they mean is there's no moat in a SOTA model.
Re: OpenAI raises $8.3B at $300B valuation
#200300 billion is completely absurd
I think NVIDIA's is absurder. Higher than Apple, Microsoft, Google. They're the number one for AI chips, but they're not the only company that can make them.