Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
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Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#2So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops?
IPOing and getting a bunch of cash, even if your stock subsequently suffers in the crash, is a lot better than being unable to get that capital infusion before the house of cards collapses.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#3What a headline
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#4So, The Economist's paywall is unbypassable?
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#5So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops? IPOing and getting a bunch of cash, even if your stock subsequently suffers in the crash, is a lot better than being unable to get that capital infusion before the house of cards collapses.
Better for whom?
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#6Why wouldn't it? There huge demand for these shares. It's not like $3+ trillion is dumped at once. It's a tiny percentage of it, and the high multiple does the rest of the work.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#7So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops? IPOing and getting a bunch of cash, even if your stock subsequently suffers in the crash, is a lot better than being unable to get that capital infusion before the house of cards collapses.
Better for whom?
The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO.
Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#8The way I've been thinking about it: there is too much money trying to pour into the market. That's why valuations are so high.
Maybe getting more of these big private companies public will bring valuations down a bit.
(Just my impression. No math or financial studies behind it :)
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#9Net buying of corporate equities by American households, trusts, funds and non-profits has averaged $660bn per year for the last few years [1]. $200bn is not fundamentally a stretch for the American equity markets, let alone capital markets more broadly.
[1] https://www.federalreserve.gov/releases/z1/20260319/html/f22... line 16, 2023 to 2025
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#10Earlier quoted context omitted.
Better for whom?
The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO. Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.
> The company. Worse for the investors
It's worse for the new investors. (If it crashes.) It's great for the old investors. They got an opportunity to sell if they wanted. If they didn't, they still own their shares, except in a company that has that IPO cash sitting in its account.