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OpenAI’s promise to stay in California helped clear the path for its IPO

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Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#261

Post by JumpCrisscross »

clhodapp wrote: post #253
JumpCrisscross wrote: post #250

Earlier quoted context omitted.

I agree that the whole thing seems shady. But I'm struggling to identify anyone who was hurt. Vague notions of "everyone" doesn't really pass muster--if we can turn that into trillion dollar companies, we should do that!

It's not that I want to see someone made whole for some hurt. What I want to see is for government to do its job and stamp a big "DENIED" on OpenAI's request to reorganize. The response should be "Sorry if you feel like you screwed up your corporate structure, but your money really is locked in this non-profit and you can't just take it out". Edit: Put a different way: Your point seems to be that there is no civil la…

> What I want to see is for government to do its job and stamp a big "DENIED" on OpenAI's request to reorganize

To what end? How thrilled would we be if an adversary nation did this to its golden goose?

> it's about the social contract we hold corporations to in exchange for allowing them to exist

Their job is to create wealth. For the time being, OpenAI is creating wealth to the tune of the GDP of the Phillipines or Norway [1]. If it's puffery, pursue it afterwards. If if not...we gained the annual production of a Nordic petrostate. When it goes public, we'll earn tax revenues equal to the entire economy of a small EU member.

Wealth doesn't make right. But I'm failing to see an incurable harm here that outweighs the upside.

[1] https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nomi...

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#262

Post by dragonwriter »

harmmonica wrote: post #84
hodder wrote: post #66

Can someone explain to me why California would believe Sam Altman plans to stay in California? This is a weak handshake agreement that could easily be flipped post IPO. The very flip from non-profit to IPO shows he will do what it takes for OpenAI to "succeed", so why would the geographical location be any more permanent than corporate structure. This isnt a diss to Sam either, it just shows he is motivated by whatev…

If they're still based in CA when they IPO at least those initial taxes will be collectible in state (assuming they're structured in a way where the IPO is a taxable event for the leadership and staff). Pretty sure the taxes collected from OpenAI will be the single biggest IPO tax windfall ever (correct me if I'm wrong, but I can't think of a bigger one).

stocks sold by the company in an IPO aren’t taxable income. Pre-IPO stocks that people liquidate because there is now a liquid market and they want to realize some gains will generate some, but I don’t know how you’d predict the magnitude of that.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#263

Post by bilekas »

JumpCrisscross wrote: post #150
lukebechtel wrote: post #117

Earlier quoted context omitted.

Because the development of this technology was originally done under a certain set of promises ostensibly intended to prevent pure capitalist profitmaxxing. The workers and supporters who were taken by this idealistic vision, believe it was a bait-and-switch, and that the original promises were never intended to be kept.

> workers and supporters who were taken by this idealistic vision The only people who can claim harm are donors and workers who actually left, e.g. Murati. "Supporters" aren't stakeholders in any material sense.

Converting from a non-profit open source organisation to a for profit private company, and to be shareholder public company, is, in my humble opinion, extremely harmful for potentially the most impactful technology humans have created before.

When companies are profit driven, the line must go up, shareholders need the line to go up, at all and any costs.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#264

Post by bilekas »

deadbabe wrote: post #199

Where else would OpenAI move to? Texas? Florida?

Pretty much wherever shareholders think they could get a better deal. At the end of the day that's all that matters to OpenAI. Even calling it open anymore leaves such a sour taste.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#265

Post by bilekas »

vessenes wrote: post #122
jacquesm wrote: post #38

Prediction for the future: OpenAI IPO's lots of money changes hands, it chugs along for a while, hits a hard spot and then is taken private for pennies on the dollar by Microsoft.

Jacques, I've been reading and enjoying your posts here for at least 15 years. (Thank you for your service.) But I think you're totally incorrect on this; oAI is going to be one of the enduring tech consumer brands built in this half of the 21st century.

> oAI is going to be one of the enduring tech consumer brands built in this half of the 21st century

I am curious why you think that, they're early to market but that by no means guarantees them a long term place at the table.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#266

Post by bilekas »

vessenes wrote: post #251
bazmattaz wrote: post #140

Earlier quoted context omitted.

Why do you say so? They’re burning cash and don’t currently have a viable path to profitability. Sure they have millions of MAU but not many paying ones.

I’ve written about it at some length here, but tldr: their ops are super profitable, likely 1bn per month net income right now. Their R&D costs are immense. You need to believe a story in which their R&D is a waste and other Competitor’s R&D is not or alternately all R&D in the space is a waste and they somehow are unable to use their capital advantage to maintain their substantial brand lead before you believe they…

> With an annualized revenue run rate expected to reach about $20 billion by year-end, losses are also mounting inside the $500 billion company, the people said.

There is a time limit for shareholders to make return on that investment and so far their operating costs are astronomical given they don't yet seem to offer any substantial product that can't be without, if anything, they're pushing people further away from AI with the slop their churning out.

reference : https://www.reuters.com/business/openai-lays-groundwork-jugg...

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#267

Post by qwertox »

hodder wrote: post #66

Can someone explain to me why California would believe Sam Altman plans to stay in California? This is a weak handshake agreement that could easily be flipped post IPO. The very flip from non-profit to IPO shows he will do what it takes for OpenAI to "succeed", so why would the geographical location be any more permanent than corporate structure. This isnt a diss to Sam either, it just shows he is motivated by whatev…

> whatever is best for the entity

Whatever is best for his ego.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#268

Post by terminalshort »

JumpCrisscross wrote: post #249
terminalshort wrote: post #183

Earlier quoted context omitted.

> Is it because the government created laws that limited its total discretion? Yes. As you said, "the people allow for corporations to exist," and the same people created the government and allow it to exist. And when those people created that government they created rules that govern what laws the government is allowed to enact. Those rules are known as the constitution. And one of the first rules the people made wh…

> that rule clearly states that the government can't take legal action against a citizen for saying something the government doesn't like. The CA government retaliating against OpenAI for its CEO threatening to leave the state would clearly violate this rule What? Conspiracy to commit a crime is punishable. If you're credibly threatening to do something that could be unlawful, the state can pursue that. Altman, of al…

Moving a corporation out of state isn't a crime. Not sure what any sort of track record has to do with any of this.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#269

Post by raincole »

jcmontx wrote: post #104

If this happened any non-western country headlines would say "corruption".

...No? It's very common to incentivize companies to locate at some areas. Special Economic Zones are not some western-only idea.

Actually you got it upside down. Only in western countries people will think it's corruption.

Re: OpenAI’s promise to stay in California helped clear the path for its IPO

#270

Post by JumpCrisscross »

bilekas wrote: post #263
JumpCrisscross wrote: post #150

Earlier quoted context omitted.

> workers and supporters who were taken by this idealistic vision The only people who can claim harm are donors and workers who actually left, e.g. Murati. "Supporters" aren't stakeholders in any material sense.

Converting from a non-profit open source organisation to a for profit private company, and to be shareholder public company, is, in my humble opinion, extremely harmful for potentially the most impactful technology humans have created before. When companies are profit driven, the line must go up, shareholders need the line to go up, at all and any costs.

> When companies are profit driven, the line must go up, shareholders need the line to go up, at all and any costs

How is that complaint separate from OpenAI having been started as a for-profit entity?

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