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OpenAI completes deal that values company at $157B

nytimes.com

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Re: OpenAI completes deal that values company at $157B

#281

Post by starchild3001 »

fhdsgbbcaA wrote: post #217
azinman2 wrote: post #171

Earlier quoted context omitted.

In 2023 Google had $307.39B in revenue and $24B in profit last quarter (suggesting ~100B in profit this year). Meanwhile OpenAI is losing money and making no where near these sums.

Google has also magnificently shit the bed with Gemini; their ads business is getting raked over the coals in court; they are a twice convicted monopolist; and are driving away top talent in droves. It reminds me of the old joke: Heard about the guy who fell off a skyscraper? On his way down past each floor, he kept saying to reassure himself: So far so good... so far so good... so far so good.

[flagged]

Re: OpenAI completes deal that values company at $157B

#282

Post by what »

choilive wrote: post #174
smt88 wrote: post #91

Earlier quoted context omitted.

Uber was a literally life-changing product with an obvious value for anyone. LLMs have neither benefit.

Every cafe, airport, school I've been to has people using ChatGPT or its competitors. Its obviously valuable for almost anyone. Just like how people cant imagine life before smartphones, people wont be able to imagine life before LLMs became ubiquitous. Its everywhere.

I’m sorry, but what? How can you tell people at the cafe/airport/school are using LLMs?

Re: OpenAI completes deal that values company at $157B

#283

Post by ddxv »

I'm surprised there isn't more concern for OpenAI in that open source / open weight models are fast catching up to the plateau that OpenAI is at. Include edge AI models, ie tiny models that fit in apps/extensions etc and you have a LOT of nearly free competition coming for OpenAI.

Re: OpenAI completes deal that values company at $157B

#284

Post by gammarator »

mulmen wrote: post #247
paxys wrote: post #232

Earlier quoted context omitted.

Google is a digital advertising company. OpenAI hasn't even entered the ads business. In the absolute best case they can take over a large chunk of Google's search market share, sure, but that still doesn't make it anything similar to Google in terms of finances. How do they start making the queries profitable? What do they do when their competitors (Claude, Gemini, Llama, Mistral, Grok and several others) undercut t…

Google started as a useful search service then corrupted itself with ads. This is the same thing that Facebook and Reddit did. It’s not hard to imagine an LLM that provides “sponsored” responses. So it’s a long term bet but the idea that Google would lose to an LLM isn’t far fetched to me.

The unit economics appear to be substantially different.

Re: OpenAI completes deal that values company at $157B

#285

Post by epolanski »

There's no chance in the world they are worth even a tenth of it.

Like literally some of their best talent tomorrow starts their own company and all they need is data center credits to catch up with open ai itself.

What is the company's moat exactly? Being few months at best ahead of the curve (and only on specific benchmarks)?

Re: OpenAI completes deal that values company at $157B

#286

Post by epolanski »

nwiswell wrote: post #106
paxys wrote: post #100

$6.6B raise. The company loses $5B per year. So all this money literally gives them just an extra ~year and change of runway. I know the AI hype is sky high at the moment (hence the crazy valuation), but if they don't make the numbers make sense soon then I don't see things ending well for OpenAI. Another interesting part: > Under the terms of the new investment round, OpenAI has two years to transform into a for-pro…

> if they don't make the numbers make sense soon then I don't see things ending well for OpenAI. This is pretty much obvious just from the valuations. The wild bull case where they invent a revolutionary superintelligence would clearly value them in the trillions, so the fact that they're presently valued an order of magnitude less implies that it is viewed as an unlikely scenario (and reasonably so, in my opinion).

But even if they invent revolutionary super intelligence, big if, what's stopping other companies to follow suit? Talent between these companies moves fast, some start their own.

Hell even open source models are nowadays better than the best models this billions burning company had just 6 months ago.

I'm lost at what is the moat here, because I really don't see it and I don't believe any of these companies has any advantage at all.

Re: OpenAI completes deal that values company at $157B

#287

Post by MacsHeadroom »

adastra22 wrote: post #190
mattmaroon wrote: post #80

Earlier quoted context omitted.

If they accomplish AGI first, they will be the world’s most valuable company, by far. If they fall short of AGI there are still many ways a more limited but still quite useful AI might make them worth far more than Meta. I don’t know how to handicap the odds of them doing either of these at all, but they would seem to have the best chance at it of anyone right now.

They accomplished AGI (artificial general intelligence) years ago. What do you think ChatGPT is? Alternatively, what are you imagining this “AGI” you speak of to be?

OpenAI defines AGI as "autonomous systems that outperform humans at most economically valuable work."

ChatGPT is not autonomous or capable of doubling global GDP.

Re: OpenAI completes deal that values company at $157B

#288

Post by adyavanapalli »

piyuv wrote: post #275
Rebuff5007 wrote: post #53

I for one can never get over the fact that Mira Murati was not laughed out of the room when she said -- with a straight face -- that GPT4 had high school level intelligence and the non-existent GPT5 will have PHD-level intelligence [1]. IMO -- this is not a serious company with serious people building an important long-lived product. This is a group of snake oil salesmen that are in the middle of the greatest grift o…

Nice of her to think these advanced autocomplete models have any intelligence at all

I know right?! Now, all you have to prove is that humans are anything more sophisticated than that :)

Re: OpenAI completes deal that values company at $157B

#289

Post by queuebert »

jsheard wrote: post #29
cs702 wrote: post #4

Given the high risk, investors likely want a shot of earning at least a 10x return. $157 billion x 10 = $1.57 trillion, greater than META's current market capitalization. Greater returns would require even more aggressive assumptions. For example, a 30x return would require OpenAI to become the world's most valuable company by a large margin. All I can say to the investors, with the best of hopes, is: Good luck! You'…

It's fine, Sam's bulletproof plan is to build AGI (how hard could it be) and then ask the AGI how they can make a return on their investments. https://www.threads.net/@nixcraft/post/C5vj0naNlEq If they haven't built AGI yet that just means you should give them more billions so they can build the AGI. You wouldn't want your earlier investments to go to waste, right?

AGI's answer will be easy: hyperinflation. Kills many birds with one stone.

Re: OpenAI completes deal that values company at $157B

#290

Post by epolanski »

itsoktocry wrote: post #108
paxys wrote: post #100

$6.6B raise. The company loses $5B per year. So all this money literally gives them just an extra ~year and change of runway. I know the AI hype is sky high at the moment (hence the crazy valuation), but if they don't make the numbers make sense soon then I don't see things ending well for OpenAI. Another interesting part: > Under the terms of the new investment round, OpenAI has two years to transform into a for-pro…

> I don't see things ending well for OpenAI. I mean, what exactly do you see happening? The have a product people love and practically incalculable upside potential. They may or may not end up the winners, but I see no scenario in which it "doesn't end well". It's already "well", even if the company went defunct tomorrow. > that clause with that timeline seems a bit risky. I'm 99% certain that OpenAI drove the terms…

> they have a product people love and practically incalculable upside potential.

They are not the only ones with the product. They don't have a moat. They are marginally better than competing models, at best. There is no moat into LLMs unless you happen to find the secret formula for super intelligence, hope nobody else finds it, and lock all of your R&D in the Moria mines so they don't go working and building it elsewhere.

There is no moat here. I can't believe so many intelligent people, even on HN cannot grasp it.

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