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Confidential submission of draft S-1 to the SEC

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Re: Confidential submission of draft S-1 to the SEC

#231

Post by HerbManic »

to11mtm wrote: post #163

The timing of all of these IPOs has a smell similar to both the US Mortgage company trend shortly before interest rates spiked and all those companies started shedding jobs progressively since, and/or the DotCom IPO boom. Where we land remains to be seen.

One of the stranger theories I have seen is that it is based on Astrology as there is a confluence of Uranus squaring the lunar nodes... whatever that means. There is a saying supposedly attributed to JP Morgan (but not likely) "Millionaires don't use astrology but Billionaires do."

One of the more rational ideas I have seen of any kind of divination is that it provides a means of passing judgement over to a near seemingly random system. If you are reading tea leaves, doing an 'I Ching' divination, biobliomancy etc. that essentially provides a coin flip to make you go 'yes' or 'no' to an opportunity.

Re: Confidential submission of draft S-1 to the SEC

#232

Post by redox99 »

bleepblap wrote: post #197
redox99 wrote: post #173

Earlier quoted context omitted.

It's like buying a ticket for a concert, realizing you can't go and that you can resell it for more than what you paid. You're right that long term it should stabilize into a low margin business. Elon is also much less risk averse than others, which helps to build stuff fast, possibly cheaper, pushing legality to the limit. Colossus was definitely built much faster than anything else. I think building datacenters sui…

The concert analogy makes sense (I analogized it as "staunching the bleeding"). WRT SpaceX building data centers: I think there's a natural tension between a "low margin business" and "being risk adverse". SpaceX (the rocket business) did well because it was high risk and high reward. Building a 10b datacenter to hope to get a slice of a low-margin industry is high risk and low reward and just seems fundamentally lik…

It's not like Elon is a stranger to low margin. Making cars is low margin, and it's not like SpaceX has crazy margins now that we know the financials.

Also I think stuff like Hetzner is a commodity. But are gigawatt scale data centers a commodity? You need those for AI training.

Anyways their goal is datacenters in space, not traditional data centers. Although I think that's only viable for inference.

Re: Confidential submission of draft S-1 to the SEC

#233

Post by JumpCrisscross »

bleepblap wrote: post #227
JumpCrisscross wrote: post #215

Earlier quoted context omitted.

> because all the inputs are commodities AI compute hardware is not a commodity. And in a shortage, commodities can command high margins. xAI has lots of NVIDIA GPUs and HBM. It also has permits and power hook-ups, both things that are getting harder to come by day by day in the U.S. Natural gas is a commodity. Doesn't make having lots of right now bad business. > the whole game is hoping that they hope to charge mor…

> AI compute hardware is not a commodity. And in a shortage, commodities can command high margins. I don't see the distinction you're drawing about "commodity", but I'm happy to be wrong on that. My point was that spaceX's ai division is buying all their inputs from external vendors and can't meaningfully differentiate themselves from person Y who buys all the same hardware except for the fact they bought them first.…

> don't see the distinction you're drawing about "commodity"

People pay markedly more for NVIDIA GPUs than they do for others. That opposes the fungibility requirement of a commodity.

Re: Confidential submission of draft S-1 to the SEC

#234

Post by JumpCrisscross »

siren2026 wrote: post #230
JumpCrisscross wrote: post #223

Earlier quoted context omitted.

> what is driving this is the need for insiders, employees, early investors to be able to sell their stock at scale before the music stops How would you differentiate insiders needing to sell versus insiders needing to dump before a crash? I remember when Uber and Airbnb and WeWork went public in quick succession. There were similar claims. WeWork never made it public. And Uber and Airbnb's IPO investors made of fant…

> How would you differentiate insiders needing to sell versus insiders needing to dump before a crash? To answer this, just ask yourself how many of the insiders would have bought the stock at current IPO's price? Most insiders would probably never touch those stocks at this price. I know a couple people at OpenAI and Anthropic that are very clearly selling everything they can as soon as they can. This is all a caref…

> couple people at OpenAI and Anthropic that are very clearly selling everything they can as soon as they can

If you are serious about this for Anthropic please drop me a line. (Not OpenAI.)

> never before had we 3 mega IPOs happening at almost the exact same time

Uber (May 2019), Airbnb (December 2020) and WeWork (scheduled 2019, SPAC 2021) were pretty closely bunched. And they were big for their time. Keep in mind that the money supply has expanded since then.

> Most IPOs end up negative after the first few quarters

Source?

Re: Confidential submission of draft S-1 to the SEC

#235

Post by siren2026 »

JumpCrisscross wrote: post #226
siren2026 wrote: post #221

Earlier quoted context omitted.

I agree with you that this might be a good marketing move overall. And I don't really care about the chain of causation. The change of rules for the available float and the fact those funds will buy based on the market cap and not the float makes it a completely irresponsible investment at this point.

> fact those funds will buy based on the market cap and not the float makes it a completely irresponsible investment at this point It's an index. The conventional way to market weight is to use market cap. The float rules are mostly for technical reasons around transaction costs for very large indices. There is a theoretical argument for float weighting, inasmuch as if you bought the stock market you'd be buying the…

> It's an index. The conventional way to market weight is to use market cap. The float rules are mostly for technical reasons around transaction costs for very large indices.

No the float rule is to avoid having to buy so much stock compared to the available stock that it would create irrational prices. This is probably going to happen with those IPOs. It's pure offer and demand!

To put it differently: Imagine a company is valued at 100B$ but only released 1% of its stock for sale (1B$). The NASDAQ100 includes it in its index based on the market cap only and because of that now needs to own about 100m$ of that stock. You are now trying to buy 100m$ out of only 1B$ available stocks. Prices are going to skyrocket artificially. If it was weighted on the float, it would only have been required to buy 1m$, which would make way more sense.

And an index can be whatever the company behind it wants it to be. The SP500 can decide absolutely whatever they want and every index fund will just have to agree and comply and buy based on those decisions.

But as everything if they do something stupid they lose credibility and customers. This is one of those instances in which they changed the rules in a way that made no clear sense and they will be remembered for that.

Re: Confidential submission of draft S-1 to the SEC

#236

Post by stuxnet79 »

Nicholas_C wrote: post #185
gordonhart wrote: post #159

Earlier quoted context omitted.

I prefer this tone to fake marketing speak. If they’d done a proper job here they’d be accused of having GPT write it. At least this is organic laziness!

Their tone is just as fake as typical fake marketing speak - they are trying to come off as nonchalant. I bet this announcement was wordsmithed to hell.

Only thing missing from this comms masterpiece was all lowercase.

Re: Confidential submission of draft S-1 to the SEC

#237

Post by siren2026 »

JumpCrisscross wrote: post #234
siren2026 wrote: post #230

Earlier quoted context omitted.

> How would you differentiate insiders needing to sell versus insiders needing to dump before a crash? To answer this, just ask yourself how many of the insiders would have bought the stock at current IPO's price? Most insiders would probably never touch those stocks at this price. I know a couple people at OpenAI and Anthropic that are very clearly selling everything they can as soon as they can. This is all a caref…

> couple people at OpenAI and Anthropic that are very clearly selling everything they can as soon as they can If you are serious about this for Anthropic please drop me a line. (Not OpenAI.) > never before had we 3 mega IPOs happening at almost the exact same time Uber (May 2019), Airbnb (December 2020) and WeWork (scheduled 2019, SPAC 2021) were pretty closely bunched. And they were big for their time. Keep in mind…

> Source?

There is an actual ETF tracking IPOs: https://finance.yahoo.com/quote/IPO/

Re: Confidential submission of draft S-1 to the SEC

#238

Post by dualvariable »

JumpCrisscross wrote: post #143
dualvariable wrote: post #138

Earlier quoted context omitted.

If you were to treat all the hyperscalars as one company with one 10-K then Anthropic buying compute from SpaceX/xAI is an internal bookkeeping transfer between two departments. It isn't the same as top-line revenue into the AI companies. It is still mostly just financing money that Anthropic raised being transferred to SpaceX.

> If you were to treat all the hyperscalars as one company with one 10-K then Anthropic buying compute from SpaceX/xAI is an internal bookkeeping transfer between two departments This is literally true for any revenue. Treat the buyer and seller as a single company and their transaction is internal.

Because it is hiding the fact that there's very little external revenue coming into the AI sector compared to the costs. AI companies doing business with each other isn't net revenue into the sector. Treating the whole sector as a single entity isn't arbitrary.

Re: Confidential submission of draft S-1 to the SEC

#239

Post by ai-x »

awwaiid wrote: post #195
ai-x wrote: post #186

Earlier quoted context omitted.

The content of all these comments has a smell similar to 2023 when NVDA had a spectacular run and HN was absolutely sure that AI is a bubble. It's also similar to 2024 when HN was sure that AI is a bubble. Similar to 2025 when HN commentators were sure that AI is a bubble. 1000% gains later, HN will continue to identify patterns of 2000/2008 and are absolutely convinced it is a bubble Note: If a company gains 1000% a…

Yes, many companies going out of business altogether, some of them large, is what a bubble pop would look like. As opposed to a uh.... Correction.

The ARR of OpenAI + Anthropic > $85B greater than McDonalds, Netflix, Starbucks, Google Cloud, CocaCola, and 1000 other iconic firms around the world.

If I wanted blind pattern matching comments of dot-com bubble, I can just ask LLMs of 2023 like ChatGPT 3.5

Re: Confidential submission of draft S-1 to the SEC

#240

Post by n42 »

lnrd wrote: post #48

What was that Warren Buffett's quote about everyone trying to leave the party seconds before midnight in a room where there are no clocks? I think it was at peak of the dot com bubble

I looked it up:

  The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities — that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future — will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands.
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