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Anthropic raises $13B Series F

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Re: Anthropic raises $13B Series F

#641

Post by sidewndr46 »

serf wrote: post #325
sidewndr46 wrote: post #219

Earlier quoted context omitted.

I'm not an expert at how private investment rounds work, but aren't most "raises" of AI companies just huge commitments of compute capacity? Either pre-existing or build-out.

it's difficult for me to imagine this level of compute existing and sitting there idle somewhere; it just doesn't make sense. So we can at least assume that whoever is deciding to move the capacity does so at some business risk elsewhere.

I've stayed away from the hyperscalers but worked at places where requesting 400 servers for a task was normal and routine.

Understanding scale is a weird thing, that I guess is psychological. I think the different experiences and travels I have made have an impact on this. Despite living for over a decade in Texas I live in one of the most densely populated places. But I recently got to visit Colorado, which is far less populated and has lots of weird places.

You can drive up to the base of the Great Sand Dunes and walk up the first few hills quite easily if you're in good shape. Here's some photos

https://www.hydrogen18.com/p/2024-great-sand-dunes-national-...

If you pull out your smartphone and look at Google Maps, it becomes pretty obvious how insane the scale of the place is. There's no real prohibition on where you can walk there because it isn't necessary. It's so large and the environment is so harsh, you aren't going to cross much of it on foot. Ever.

Re: Anthropic raises $13B Series F

#642

Post by Barbing »

reissbaker wrote: post #632
Barbing wrote: post #426

Earlier quoted context omitted.

Thoughts on Ed Zitron’s pessimism? “There Is No AI Revolution” - Feb ‘25: https://www.wheresyoured.at/wheres-the-money/

Ed Zitron plainly has no idea what he's talking about. For example: Putting aside the hype and bluster, OpenAI — as with all generative AI model developers — loses money on every single prompt and output. Its products do not scale like traditional software, in that the more users it gets, the more expensive its services are to run because its models are so compute-intensive. While OpenAI's numbers aren't public, this…

Thank you for your analysis!

Re: Anthropic raises $13B Series F

#643

Post by mlyle »

cjbgkagh wrote: post #640
mlyle wrote: post #638

Earlier quoted context omitted.

Probably not. But we don't tend to see P=MC where there's any differentiation or barrier to entry, and I do not believe that AI is fully commoditized or will be soon.

Perhaps my 'marginal cost' should have been taken to be 'near marginal cost' and as such I don't believe it'll be fully commoditized either, just mostly commoditized in that it becomes impossible to extract meaningful monopolistic rents. Similarly I don't believe in perfect market efficiency so nothing would be exactly at marginal cost. At the moment we have investment subsidizing use so often these APIs are availabl…

I don't believe the APIs are actually under marginal cost. Inference is cheap, but people are using a lot of it.

The problem is, the arguments you're making could be used for almost any industry, including ones that we've seen sustained excess profits.

Re: Anthropic raises $13B Series F

#644

Post by eatsyourtacos »

ACCount37 wrote: post #249
eatsyourtacos wrote: post #241

Earlier quoted context omitted.

Economics is entirely made up. It's a social science.

In case of economics, the gap between "social science" and "entirely made up" is ten miles long and filled with hellfire. The laws of economics have the kind of inevitability you expect from the laws of physics. Disrespect them at your own peril.

>The laws of economics have the kind of inevitability you expect from the laws of physics

Absolutely not- that is ridiculous.

Let's take "supply and demand" for example. Supply and demand only applies when you assume greed and capitalism. In a different social construct, the traditional supply & demand completely falls apart. But the problem is economics is presented as some sort of fact of nature. It just reinforces survival of the fittest instead of society that helps everyone.

Increasing prices because of demand is not the law of the land- it's a greed of humans that you normalize and make acceptable.

Re: Anthropic raises $13B Series F

#645

Post by cjbgkagh »

mlyle wrote: post #643
cjbgkagh wrote: post #640

Earlier quoted context omitted.

Perhaps my 'marginal cost' should have been taken to be 'near marginal cost' and as such I don't believe it'll be fully commoditized either, just mostly commoditized in that it becomes impossible to extract meaningful monopolistic rents. Similarly I don't believe in perfect market efficiency so nothing would be exactly at marginal cost. At the moment we have investment subsidizing use so often these APIs are availabl…

I don't believe the APIs are actually under marginal cost. Inference is cheap, but people are using a lot of it. The problem is, the arguments you're making could be used for almost any industry, including ones that we've seen sustained excess profits.

It depends on how you define sustained and define excess profits.

Being an unusually effective and well managed company can certainly yield sustained above average returns but that hardly means that is a meaningful barrier to entry - the question at hand.

Ozempic is marked up 200x (20,000%) because they're able to extract monopolistic rents, that's a completely different ballpark of 2x or even 5x markups.

In a fully commoditized industry participants yield average ROIs, in a mature market it's industry dependent but I would consider ranges from 10% to 100% above average ROIs to be reasonably normal. It's when things get to 10x to > 100x that I would consider to be able to extract monopolistic rents. I know I'm mixing up profits (ROIs) with markups on COGs with the issue being that companies extracting monopolistic rents tend to obscure the fact with padded expenses and the financial details needed to calculate Total Production Cost per Unit are generally not available.

Re: Anthropic raises $13B Series F

#646

Post by nly »

simianwords wrote: post #586
oblio wrote: post #584

Earlier quoted context omitted.

No, you wouldn't have, unless you were one of handful VCs or Uber execs (ok, and a bunch of pre-IPO Uber employees). Uber IPO May 2019: market cap $82bn. Uber now: $193bn. 2.35x multiplier. S&P 500 May 2019: $2750. S&P 500 now: $6460. 2.35x multiplier. So the much, much riskier Uber investment has barely matched a passive S&P 500 investment over the same time frame. And the business itself has lost money, more money…

Let me get this straight. I was replying to this: "So far Lyft seems to be doing okay, which proves the business plan doesn't really work." when I said Uber is profitable Your retort to that was S&P grew more than Uber, which is a nonsensical argument. Our standard for what is a good business is if it grows faster than S&P after going public? Edit: I dug up some research related to this, most companies do worse than…

Most people can't invest in a company pre-IPO, so it's irrelevant

The same is currently true of Anthropic.

Re: Anthropic raises $13B Series F

#648

Post by zestyping »

lelanthran wrote: post #559
ChadNauseam wrote: post #506

Earlier quoted context omitted.

> The creation of wealth comes from trade, [...] I'm not sure to what extent you meant this, but I don't know that I'd agree with it. Trade allows specialization which does increase wealth massively, no doubt. And because of how useful specialization is, all wealth creation involves trade somewhere. But specialization is just one component of wealth creation. It stands alongside labor, innovation, and probably others…

>> > The creation of wealth comes from trade, [...] > I'm not sure to what extent you meant this, but I don't know that I'd agree with it. At a very foundational level, all wealth comes from trade, even when there is no currency involved. When two parties voluntarily make a trade, each party gets more value out of the trade than they had before, so the sum total of value after the trade is, by definition alone, great…

Wow, that's a massive blind spot you've got there.

The value comes from doing the thing. Fixing the tractor creates value. Growing and harvesting the potatoes creates value.

Trading the potatoes for something you value more, yes, also creates additional value. But notice that potatoes have value to you even if you don't trade them for anything.

If you choke on a grape and a helpful volunteer saves your life, they create value. Nothing was exchanged, but they sure as hell generated wealth right there.

Labour and voluntary trade both create value. I wonder what sort of mindset one must have to forget that labour exists.

Re: Anthropic raises $13B Series F

#649

Post by xpe »

utyop22 wrote: post #622
xpe wrote: post #618

Earlier quoted context omitted.

> But in the consumer market segment, for most cases, its all about who is cheapest (free preferably) - aside from the few loonies who care about personality. On what basis do you know this? Or more like your personal impression — based on asking how many people? Your friends?

I have a wide ranging sample of folks I've spoken to and observed their usage.

>10? >33? >100? >333?

Just informal conversations? Or surveys of some kind? I’m genuinely curious. After studying statistics and research design, I have learned to be very cautious at what I conclude.

I often talk with various people outside of my usual peer and work groups, but I wouldn’t know how to get anything close to an unbiased take given the social constraints. Maybe I would notice large shifts over time.

Observation: LLMs are pretty new in the scheme of things and information diffusion seems pretty different across age groups, geographies, and professions. This makes it pretty hard to even be confident that one knows how to collect good data.

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