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OpenAI closes funding round at an $852B valuation

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Re: OpenAI closes funding round at an $852B valuation

#331

Post by woah »

nine_k wrote: post #14
nemo1618 wrote: post #7

I'm old enough to remember when companies worth $1 billion were called "unicorns." Now we have a company raising 122 times that? Valued at nearly 1000 times that...? At least they're throwing consumers a bone via the ARK deal. It's crazy how little AI exposure is available to anyone who isn't already wealthy and/or connected.

I think this is reality-distortion field rivaling that of Jobs', and a crisis of faith. Nobody apparently believes that capital is worth investing into anything but AI.

OpenAI is making $24b a year. It's a 32x revenue multiple. High, but not insane. Spinning this as a story of overinvestment doesn't make sense.

Re: OpenAI closes funding round at an $852B valuation

#332

Post by voganmother42 »

gunsle wrote: post #330
voganmother42 wrote: post #303

Earlier quoted context omitted.

After the DoD moves? It is not just the technologically illiterate, it is part of the US culture war. OpenAI is the MAGA brand, like tesla.

What an absurd leap. OpenAI is the maga brand because they simp for government contracts like any massive company would?

Did you miss the cancel/unsubscribe gpt boycott? It was only about a month ago. Many people I know cancelled/unsubscribed. To be fair though, most people I have talked with needed almost no encouragement to move to anthropic or google (better products, easy to switch etc). Consumer sentiment can change quickly.

Re: OpenAI closes funding round at an $852B valuation

#333

Post by minraws »

manquer wrote: post #253
SilverElfin wrote: post #202

Earlier quoted context omitted.

Does the GAAP accounting matter if everyone passively buys shares due to the new fast entry rules, which corruptly will force us all to buy into these companies? The fundamentals and true value seem less relevant than ever: https://www.benzinga.com/markets/tech/26/03/51248353/michael...

Diluting the index entry rules, only devalues the index utility. When it becomes a bigger problem, other indices with higher quality controls will out compete the current ones and be used by asset managers seeking safety. More likely than not, most of us are already holding stock in these companies one way or another. All the Mag 7 hold a major chunk of OAI and Anthropic stock anyway, slower entry does not make it le…

I personally find this is the correct solution, since indexes are over-inflated either way, this brings much needed sanity to the index. Your index is now worth much more or much less based on how you view the AI bubble and you are forced to understand and correct your forward looking investments accordingly.

Passive investments are good, but if taken too far as they clearly have been in the last decade they become a scam. Everyone is SIPing into it, and there is infinite liquidity. Until one big whale finally decides they are booking it, then all hell will break loose on the same damn day.

Re: OpenAI closes funding round at an $852B valuation

#334

Post by [deleted] »

bandrami wrote: post #329
nl wrote: post #327

Earlier quoted context omitted.

OpenAI seems to do reasonably well at attracting capital investment without profits. As did Amazon, Google, Meta etc etc.

OpenAI is great at attracting people who say "yeah, sure, I'll give you capital at some point in the future" who then never actually give them the capital (or at least haven't yet).

[deleted]

Re: OpenAI closes funding round at an $852B valuation

#335

Post by nl »

bandrami wrote: post #329
nl wrote: post #327

Earlier quoted context omitted.

OpenAI seems to do reasonably well at attracting capital investment without profits. As did Amazon, Google, Meta etc etc.

OpenAI is great at attracting people who say "yeah, sure, I'll give you capital at some point in the future" who then never actually give them the capital (or at least haven't yet).

They seem to be spending lot of cash too...

Re: OpenAI closes funding round at an $852B valuation

#336

Post by daemin »

What if all the people currently using these "AI" services are the entire market for those services? I'm pretty sure everyone that wants to use LLMs is already doing so and already paying for the service.

That would mean the only way to increase growth would be to charge more per token and to get the existing people to use more tokens. Both of which seem to be only what mature companies do when trying to squeeze the cash cow for all it's worth.

It also explains why they're trying to stuff AI into everything, to keep the numbers up, and to get everyone to try and pay them money.

Re: OpenAI closes funding round at an $852B valuation

#338

Post by harmonic18374 »

aurareturn wrote: post #150
Barrin92 wrote: post #126

Earlier quoted context omitted.

not if your product is selling two dollars for one dollar and as soon as you'll start to charge more I'll switch to one of your twenty competitors profit isn't a function of having a killer product, it's a function of having no competition

And why do you think twenty competitors can stay competitive for years to come? Industries always consolidate and winners emerge. SOTA LLMs look like a natural monopoly or duopoly to me because the cost to train the next model keeps going up such that it won't make sense for 20 competitors to compete at the very high end. TSMC is a perfect example of this. Fab costs double every 4 years (Rock’s Law). It's almost impo…

Google has already surpassed them both in all areas except coding. People on HN only look at benchmarks, but Gemini's multimodal understanding, things like identifying what a plant is, normal user use cases (other than chatting), integration with other tools, is much better.

It's believable that Meta, ByteDance, etc. can catch up too. It is not certain that scaling will meaningfully increase performance indefinitely, and if it stops soon, they surely will. Furthermore, other market conditions (US political instability) can enable even more labs, like Mistral, to serve as compelling alternatives.

Uber, TSMC, etc. have strong moats in the form of physical goods and factories. LLMs have nothing even remotely comparable. The main moat is in knowledge, which is easy to transfer between labs. Do you think all the money that goes into training a model goes into the actual final training run? No, it is mostly experiments and failed ideas, which do not have to be repeated by future labs and offshoots.

Re: OpenAI closes funding round at an $852B valuation

#339

Post by mxkopy »

daemin wrote: post #336

What if all the people currently using these "AI" services are the entire market for those services? I'm pretty sure everyone that wants to use LLMs is already doing so and already paying for the service. That would mean the only way to increase growth would be to charge more per token and to get the existing people to use more tokens. Both of which seem to be only what mature companies do when trying to squeeze the…

The market hasn’t been built out yet. There’s that post from a couple days ago where someone frontloaded the entire UX of an operating system onto an LLM, so you just tell the hardware what you want to do and it does it. https://news.ycombinator.com/item?id=47557165

The growth is there but it’s going to be a marathon, not a sprint. I don’t know why everyone’s in such a goddamn hurry all the time

Re: OpenAI closes funding round at an $852B valuation

#340

Post by natas »

daemin wrote: post #336

What if all the people currently using these "AI" services are the entire market for those services? I'm pretty sure everyone that wants to use LLMs is already doing so and already paying for the service. That would mean the only way to increase growth would be to charge more per token and to get the existing people to use more tokens. Both of which seem to be only what mature companies do when trying to squeeze the…

Give it a year or two, and apple or any other hardware will have unified memory OR AMD will have a good offering to run all that stuff locally. It won't be as good as Claude, but it'll do for 90% of the things. It will be expensive as first, just like the first mainframes, then give it another 5 years or so, and it'll be affordable.
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