Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

OpenAI Is Preparing to File for an IPO Soon

wsj.com

Post reply on HN
Print view View original

181–190 of 426 posts

Re: OpenAI Is Preparing to File for an IPO Soon

#181

Post by andsoitis »

jddj wrote: post #173
andsoitis wrote: post #141

Earlier quoted context omitted.

> Rather, it will make the pension funds and passive investors the bag holders for the oligarchs. Care to explain the mechanics? I’m an investor (both in passive and more active vehicles) and don’t understand what you mean.

Index funds buy companies, for the most part, according to their market capitalisation. They own more of bigger companies than small. There's the option of "equal weight" or other strategies but the overwhelming majority is market cap weighted. Index funds are also really, really big now and contain a lot of money earmarked for retirement/pensions. In theory if you had a temporarily very frothy market into which you…

Ok, but how does this "hold the bag for the oligarchs"? And which specific oligarchs do you have in mind when you say this? Are you thinking of Sam Altman and Dario Amodei and Elon Musk?

Re: OpenAI Is Preparing to File for an IPO Soon

#182

Post by cheinic6493 »

ifwinterco wrote: post #124
NewJazz wrote: post #115

Earlier quoted context omitted.

Direct indexing is a thing.

It’s a thing but your order execution won’t be as efficient as an ETF, so you will be losing a non-negligible amount each year in slippage from the large number of small transactions

> It’s a thing but your order execution won’t be as efficient as an ETF, so you will be losing a non-negligible amount each year in slippage from the large number of small transactions

Not necessarily

ETF managers execute block trades outside the normal market, sometimes through dark pools, not even reported to the public.

Fidelity, Vanguard, etc ask JPMorgan, Goldman to execute these block trades and pay them a fee. This fee can exceed the “slippage” a retail investor can face.

Re: OpenAI Is Preparing to File for an IPO Soon

#183

Post by dbbk »

techtuate wrote: post #95

I was wrong - not investing in FB and Amazon many years ago - thought those businesses will shrivel and die. I believe OpenAI is a bit of a coin flip as the AI space evolves. In fact I feel all AI will be marginal return generators at best. There are a lot of incumbents and a lot more coming as barriers to entry get increasingly lower. Unless a company can build a near monopoly it'll be hard to justify a 100X revenue…

If you were going to invest in any AI company literally the only one I would trust to still exist in 10 years would be Google

Re: OpenAI Is Preparing to File for an IPO Soon

#184

Post by mrweasel »

aurareturn wrote: post #59
RandallBrown wrote: post #55

Earlier quoted context omitted.

Isn't SpaceX the only one of those that actually makes money?

Personally, I don't worry about profitability in the short term. If Anthropic is adding $15b ARR every single month, and their gross margins are 50%+ (per Dario), profits are inevitable. The thing I'm most worried about with SpaceX is bundling X.com, xAI with it. I don't want to invest in X.com nor xAI. Lastly, I don't my money tied to the Elon rollercoaster.

I understand very little of this, but hasn't OpenAI burned so much money, which it now need to be recouped, making any profit short or long term is mostly a fantasy.

If OpenAI IPOs, then investors will expect a return. OpenAI can't generate that, so they'll be forced to slash R&D, stop datacenter roll outs and layoffs, so what's left? A model that will grow stale in six month, massive commitments and debt?

Re: OpenAI Is Preparing to File for an IPO Soon

#185

Post by andsoitis »

karmakurtisaani wrote: post #178
jddj wrote: post #173

Earlier quoted context omitted.

Index funds buy companies, for the most part, according to their market capitalisation. They own more of bigger companies than small. There's the option of "equal weight" or other strategies but the overwhelming majority is market cap weighted. Index funds are also really, really big now and contain a lot of money earmarked for retirement/pensions. In theory if you had a temporarily very frothy market into which you…

In this case, Elon has moved the wildly unprofitable XAI into SpaceX. SpaceX will IPO with a trillion dollar valuation, while only releasing a small number of shares for public trading. Due to the high valuation, index funds are required to buy SpaceX stock, which Elon will presumably slowly sell them in order not to crash the stock. The funds will be left holding the stock, while eventually the price will crash, bec…

> Elon will presumably slowly sell them in order not to crash the stock. The funds will be left holding the stock, while eventually the price will crash, because the company will simply not make enough money to justify the valuation.

Musk owns about 50% of SpaceX. You are saying he is planning to sell the vast majority of that holding at a gradual pace that will not be noticed by anyone but fast enough to get a high price?

Re: OpenAI Is Preparing to File for an IPO Soon

#187

Post by skippyboxedhero »

coliveira wrote: post #79
henry2023 wrote: post #74

Soon to be part of your portfolio if you hold Nasdaq 100 or S&P 500 trackers line QQQ or SPY.

ETFs are a trap. Put most of your money in single stocks. It is ok to diversify, you don't need an ETF for this.

return on the average stock is -2% iirc, terrible idea

Re: OpenAI Is Preparing to File for an IPO Soon

#188

Post by AlecSchueler »

wg0 wrote: post #160
AlecSchueler wrote: post #138

Earlier quoted context omitted.

What is the third world in 2026?

"Developing nations" if you will. Like these days banks are referring to labour class as "low quality human capital". Whatever terms fancy you, the underlying reality remains the same.

> "Developing nations" if you will

I wouldn't, I'm not sure which nations are developing or that they're developing into. Aren't we all developing all the time?

> Whatever terms fancy you, the underlying reality remains the same.

That's great, could you just explain the underlying reality without the loaded terms then?

Re: OpenAI Is Preparing to File for an IPO Soon

#189

Post by gpt5 »

henry2023 wrote: post #74

Soon to be part of your portfolio if you hold Nasdaq 100 or S&P 500 trackers line QQQ or SPY.

Note that index funds don't hold companies in proportion to their market cap, but in proportion to their free float (shares available to purchase on the market).

Both SpaceX and OpenAI's estimated free float are around 4-5% of their shares at IPO. This means that we really are talking about companies in the sub $100M valuation in term of index fund impact (assuming under $2T for each).

Re: OpenAI Is Preparing to File for an IPO Soon

#190

Post by chvid »

dbbk wrote: post #183
techtuate wrote: post #95

I was wrong - not investing in FB and Amazon many years ago - thought those businesses will shrivel and die. I believe OpenAI is a bit of a coin flip as the AI space evolves. In fact I feel all AI will be marginal return generators at best. There are a lot of incumbents and a lot more coming as barriers to entry get increasingly lower. Unless a company can build a near monopoly it'll be hard to justify a 100X revenue…

If you were going to invest in any AI company literally the only one I would trust to still exist in 10 years would be Google

Yep. Two simple boring bets on AI: NVIDIA and Google.
Post reply on HN