Comment by miohtama
16 hours ago
OpenAI and Anthropic are making north of 4B/year revenue so some companies have figured out the money making part. ChatGPT has some 800M users according to some calculations. Whether it's enough money today, enough money tomorrow, is of course a question but there is a lot of money. Users would not use them in a scale if they do not solve their problems.
OpenAI lost 12bn last quarter
It’s easy to make 1 billion by spending 10 billion. That’s not “making money” though, it is lighting it on fire.
People used to say this about Amazon all the time. Remember how Amazon basically didn’t turn any real profits for 2 decades? The joke was that Amazon was a charitable organisation being funded by Wall Street for the benefit of human kind.
That didn’t last. People in the know knew that once you have a billion users and insane revenue and market power and have basically bought or driven out of business most of your competitors (Diapers.com, Jet.com, etc) you can eventually slow down your physical expansion, tighten the screws on your suppliers, increase efficiencies, and start printing money.
The VCs who are funding these companies are hoping that they have found the next Amazon. Many will probably go out of business, but some might join the ranks of trillion dollar companies.
So every company that doesn't turn any profits is actually Amazon in disguise?
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Amazon had paper losses and great cashflow. OpenAI has actual, real losses and terrible cashflow.
this gets brought up a lot, and the reality is that the scale of Amazon's losses is completely dwarfed by what's going on now