Comment by cmiles8
11 days ago
The window has basically closed for them for the time being. The business math just isn’t there.
The best option at this point is kick the can down the road and hope market sentiment improves next year. Not much signal that it will, and quite a lot of signal the sentiment only declines, but pumping the brakes is the least worst option on the table.
> window has basically closed for them for the time being. The business math just isn’t there
Unless Anthropic also cancels its IPO, this probably isn't it.
The math doesn’t help Anthropic either but the market views these two companies very differently at the moment. Anthropic is seen as having momentum. Open AI is seen as having likely peaked. That makes a huge difference when pitching an IPO.
> but the market views these two companies very differently at the moment. Anthropic is seen as having momentum. Open AI is seen as having likely peaked
What are you basing this on? Both are currently doing rounds/tenders that are placing without problems.
The media treats these two differently, as do financial influencers. But I'd be careful about conflating either of them with the market.
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Agree but Anthropic momentum is fading too.
Open source is starting to slowly become a source of frustration for frontier labs In the discussion around value for money.
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> Anthropic is seen as having momentum.
How can you tell that? "The Market" at the moment is the private investor market and, to my (admittedly untrained) eye, those two companies are being treated exactly the same when they raise.
ChatGPT is the 5th most visited website in the world and gets a ridiculous amount of user data. They're going to be an advertising powerhouse.
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> The business math just isn’t there.
What do you mean? I promise I'm not being facetious or satirical. I'm just too simple and conservative of an investor to understand this comment. (for example: Is the price-to-earnings ratio too high? I probably wouldn't want to invest in the business.)
They are losing too much money. With open source options that are always close to frontier performance it will always be hard for them reduce training costs and charge premium rates.
I guess my point is that IPO timing is irrelevant if they don’t have an actual profitable business.
I doubt that anyone at OpenAI would let their payday decrease. If anything, they got assurances that everyone would keep the bubble going until 2028 no matter what.
There may never be another window. They will run out of money especially if open models catch up.
They should have done it a year or two ago when the hype was strong.
Today everyone knows there's no agi coming up and it will be a very long time until they generate any profits, if ever.