[HN Gopher] Confidential submission of draft S-1 to the SEC
___________________________________________________________________
Confidential submission of draft S-1 to the SEC
Author : hackerBanana
Score : 328 points
Date : 2026-06-08 21:22 UTC (8 hours ago)
(HTM) web link (openai.com)
(TXT) w3m dump (openai.com)
| XCSme wrote:
| > We recently submitted a confidential S-1. We expect it to leak
| so we're just announcing it.
|
| What?
| SilverElfin wrote:
| They expect someone to leak that they had submitted it, so
| they're just saying it themselves. I don't think they mean that
| the actual contents (like financial projections and all that)
| will be leaked.
| hmokiguess wrote:
| Narcissist marketing, Sam loves it.
| ortusdux wrote:
| I wonder how much of it is photos?
| rvz wrote:
| This is the true definition of AGI and will be achieved this
| year.
|
| The I in AGI has always stood for IPO.
| hmokiguess wrote:
| Altman Gets his IPO
| root-parent wrote:
| Well if you reverse OpenAI ... the first letter is I and the
| last two are P O...
| onlyrealcuzzo wrote:
| Artificially Generated Internal-rate-of-Return
| mlmonkey wrote:
| What's the point of a "confidential S-1"?? Isn't the S-1 supposed
| to inform potential investors?!? So ... shouldn't it _not_ be
| confidential??
| tyre wrote:
| The SEC needs to review it before approving a company to go
| public at all. It's targeted at investors but they need to
| clear it, ask questions, demand changes, etc.
| simonw wrote:
| Anthropic did exactly the same thing on June 1st:
| https://www.anthropic.com/news/confidential-draft-s1-sec
| throw0101a wrote:
| Note the word "Draft".
|
| Once it no longer is being drafted--and agreed upon by all
| parties to meet the needed regulatory standards--it will become
| final and be publicly published.
| JumpCrisscross wrote:
| > _What 's the point of a "confidential S-1"?_
|
| "Under the JOBS Act, it has been possible since April 2012 for
| 'emerging growth companies' to file a Form S-1 on a
| confidential basis, only making the contents public 21 days
| prior to the road show for the IPO" [1]. Since 2017 and 2025
| it's been available to basically all companies [2].
|
| Withdrawing an IPO looks bad. Confidential filing lets issuers
| start and have the option to abort the process without taking
| reputational damage. (The specifics of OpenAI's filing, and any
| back and forth with the SEC, remains confidential.)
|
| [1] https://en.wikipedia.org/wiki/Form_S-1
|
| [2] https://www.sec.gov/about/divisions-offices/division-
| corpora...
| uxhacker wrote:
| Also according to the Financial Times that this confidential
| filling gives employees who are considering to sell shares
| transparency.
| koolba wrote:
| Would be hilarious if they used an LLM to write it and it started
| hallucinating revenue streams and numbers.
| stanmancan wrote:
| I'm pretty sure they're smart enough to remember to put "make
| no mistakes" in their prompt.
| ai_critic wrote:
| > We have not decided on timing yet; it may be a while because
| there are things we want to do that are likely easier as a
| private company.
|
| Presumably those things were harder as a charity/non-profit.
| krona wrote:
| They need to financially engineer a good looking quarter
| beforehand.
|
| Perhaps Larry Ellison can cut them a nice quid pro quo for a
| few months to make OpenAI look profitable (like the
| SpaceX/Anthropic deal), although that's probably unlikely given
| the debt Oracle is taking on to build it's infra.
| anukin wrote:
| You are forgetting the google space x deal too
| Eji1700 wrote:
| > They need to financially engineer a good looking quarter
| beforehand.
|
| Eh given the quality of recent IPO proposals I think they can
| just say there's a couple zillion air molecules to turn into
| gold and be done with it.
| tsunamifury wrote:
| you mean the 50% of its company that was leveraged to
| purchase Paramount?
| taneq wrote:
| Just depreciate their server farms less this year to reduce
| losses. ;)
| JumpCrisscross wrote:
| > _like the SpaceX /Anthropic deal_
|
| I understand the scepticism around Google's deal with SpaceX,
| given the former holds a stake in the latter. But Anthropic
| buying SpaceX's compute doesn't have any related-party smell
| to it. That genuinely looks like SpaceX having cornered some
| valuable compute.
| SecretDreams wrote:
| Google owns 14% Anthropic and 6% xAI.
|
| When Anthropic spends on xAI, it benefits Google. When
| google spends on xAI, it benefits Google. When xAI spends
| on Google, believe it or not, that benefits Google.
|
| This is how a Ponzi -style circular financing scheme
| typically works.
| JumpCrisscross wrote:
| > _When Anthropic spends on xAI, it benefits Google_
|
| Unless Google is directing these transactions, this is
| not a novel issue. (We see a similar effect with mutual
| funds owning most companies [1]. It's a weak effect.)
|
| > _This is how a Ponzi -style circular financing scheme
| typically works_
|
| No. It's potential conflicts of interest. It's not
| circular financing. Circular financing follows the cash.
| When NVIDIA invests in OpenAI so OpenAI can buy NVIDIA
| chips, _that_ is circular financing.
|
| [1] https://insights.som.yale.edu/insights/the-rise-of-
| the-mutua...
| SecretDreams wrote:
| I think it depends on how you view the payout google will
| get when these companies IPO and give Google exist
| liquidity and a nicer looking balance sheet, if needed,
| either or.
| JumpCrisscross wrote:
| > _it depends on how you view the payout google will get
| when these companies IPO and give Google exist liquidity
| and a nicer looking balance sheet_
|
| Google has a fantastic balance sheet with or without
| these investments. None of the recent deals have uniquely
| enabled an IPO. So they'd be playing to increase their
| stakes' value by a few points ahead of a dump, a dump
| that would almost certainly wipe out much more than
| they'd stand to gain by trying to make someone else a
| dollar so they get nickels and dimes out of it.
| thundergolfer wrote:
| No a Ponzi scheme involves not output, but here there is
| very much output in the inference being sold by
| Anthropic. Pretty big difference.
| krona wrote:
| I'm actually talking about both. WSJ publishes Anthropic
| artificial profitability. Days later the reason for the
| profitability appears in SpaceX S-1; it's compute costs
| were artificially suppressed. Both are going public. It's a
| quid pro quo.
| JumpCrisscross wrote:
| > _It 's a quid pro quo_
|
| This is a reasonable accusation! It doesn't make a lot of
| sense-the _Journal_ article is worth a hell of lot more
| than SpaceX referencing Anthropic 's profitability. And
| we have zero evidence for it-one could raise this
| accusation against any compute partner Anthropic were to
| buy from.
| LearnYouALisp wrote:
| Reasonable or *un*reasonable?
| JumpCrisscross wrote:
| > _Reasonable or unreasonable?_
|
| Reasonable. The influencers who just learned the term
| circular financing are mostly idiots. The ones pointing
| out the conflict of interest with Google are technically
| correct, but the conspiracy takes so many moving parts to
| yield such little gain that it would have to be
| particularly stupid in vision yet competent in execution
| to pull off.
|
| But asking if there is a _quid pro quo_ between Anthropic
| and SpaceX? Like, there could be. We have no evidence of
| it. The S-1 mention doesn 't make any sense. But they're
| both going public and if I were a journalist I'd look
| into it.
|
| The base case, that there is commercial value to xAI's
| datacenters that folks in the frontier-model space are
| competing to get access to, does seem to be one folks
| here are actively rejecting.
| PunchyHamster wrote:
| > That genuinely looks like SpaceX having cornered some
| valuable compute.
|
| That's nice way to say "invested in AI that turned out to
| be flop nobody wants to pay for so they are selling spare
| capacity"
| JumpCrisscross wrote:
| > _That 's nice way to say "invested in AI that turned
| out to be flop nobody wants to pay for so they are
| selling spare capacity"_
|
| Both takes are true. xAI invested in capacity that was
| supposed to yield frontier-model-maker margins. Grok
| failed to generate enough interest. So now they're
| selling it.
|
| That's absolutely a good business, in a way that's more
| certain than the frontier-model one. But it's also lower
| margin, which doesn't support the sort of valuation
| SpaceX is going for.
| bleepblap wrote:
| What I don't understand is how it's even a good low-
| margin business. Maybe I'm missing something but:
|
| Data centers (before recently) are low margin businesses
| because all the inputs are commodities: you buy power
| (joules), power (PDU), cooling hardware, physical racks,
| etc.. from the same vendors as everyone else. Worse, your
| biggest potential clients have the scale to just build it
| on their own and cut you out because of their scale and
| because you don't bring anything unique (outside of maybe
| physical proximity to an interesting market)
|
| xAI has all the same commodity inputs plus another huge
| upfront capital expense (GPU/storage/networking), and
| their customer base is exclusively the well-funded
| companies who would normally just build it on their own.
|
| I assume that they can't get better deals from nvidia
| than (e.g.) Microsoft because of their scale, so the unit
| cost of their inputs is the same or worse than their
| clients.
|
| So the whole game is hoping that they hope to charge more
| now because people can't build fast enough and try to
| recoup their upfront costs before either a) other
| capacity comes online and b) the installed hardware
| becomes obsolete.
|
| I'm being earnest -- it seems like they're trading one
| tiny margin service (datacenter) for another tiny margin
| service, with the added difficulty that there's an
| additional 10 figures of upfront expenditures and their
| viability depends solely on paying everything off before
| the price floor drops. Maybe it's staunching the
| bleeding, but it seems like not a great move
| bee_rider wrote:
| I wonder if they do have non-commodity AI capabilities,
| just, ones that don't translate into a world-class
| frontier model.
|
| Like they might have hired really good AI infra folks,
| gotten really good uptimes on their nodes, gotten folks
| who really know how to configure Infiniband (or
| whatever). But then, didn't find the folks who knew what
| to run on that infrastructure. Or maybe Grok just had too
| much political drama around it.
| bleepblap wrote:
| Maybe they have something else im the books, I truly have
| no idea. But once you get down from the top rung of full-
| bandwidth cross section networking at the 100k node
| networking scale "AI" infra, theres no shortage of people
| who can do that. Most importantly, labor isn't the big
| chunk of the outlay. Even if they have 50 engineers
| clearing $1m/yr, that's pocket change for everything else
|
| EDIT: said 50 engineers at $50m/yr originally and meant
| 50 @ $1m/yr
| redox99 wrote:
| 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
| suits him better than a pure software play, where "move
| fast break things" is already the norm.
| bleepblap wrote:
| 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 like a losing strategy.
| redox99 wrote:
| 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.
| JumpCrisscross wrote:
| > _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 more
| now because people can 't build fast enough and try to
| recoup their upfront costs before either a) other
| capacity comes online and b) the installed hardware
| becomes obsolete_
|
| Correct. But charging people now generates incumbency
| advantages that make beating (a) and (b) easier. (From
| what I can tell, (b) isn't an existential issue, at least
| for xAI, because they've basically already recouped their
| investment with commited contracts they'd have to fuck up
| on to lose.)
| bleepblap wrote:
| > 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.
| Which...
|
| > Correct. But charging people now generates incumbency
| advantages
|
| I don't see now this is an "incumbency advantage".
| There's nothing that sticks their clients to stay there
| and sign up for the next data center.
| JumpCrisscross wrote:
| > _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.
| bleepblap wrote:
| In the west, there's no actual competitor to NVIDIA
| hardware. Yes, people make other chips, but nothing is a
| serious drop-in replacement for the nv stack. Between the
| networking and software, they're truly a different
| "thing" of accelerator, and I don't consider them
| fungible at all. The US government tried to build 3
| supercomputers with each of nvidia/amd/intel accelerators
| and you can see how it went
| JumpCrisscross wrote:
| > _there 's no actual competitor to NVIDIA hardware...I
| don't consider them fungible at all_
|
| Which is why nobody should claim NVIDIA makes a
| commodity.
| cco wrote:
| You're not wrong in the long term, either in general or
| for SpaceX.
|
| In the long term, hopefully the market stabilizes, new
| entrants can challenge Nvidia etc. But of course maybe
| not!
|
| However for SpaceX, this is a dead end move. They made a
| good decision on buying this compute when they did but
| they failed to use it to create a compelling model.
|
| So they're selling access to recoup some of their
| investment (maybe a profit?). But what's the plan as
| these chips age out over the next three to five years?
| Become a compute company? They claim they want to... in
| space!
|
| Regardless, they bought some valuable chips, failed to
| use them, but can now sell access and recoup over the
| next few years before they become outdated.
| lumost wrote:
| Why do we think frontier model vendors are high margin?
| dualvariable wrote:
| 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.
| JumpCrisscross wrote:
| > _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.
| dualvariable wrote:
| 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.
| JumpCrisscross wrote:
| > _it is hiding the fact that there 's very little
| external revenue coming into the AI sector compared to
| the costs_
|
| There is a _lot_ of revenue dumping into this sector. If
| there weren't, you'd have a point about manufactured
| numbers. But I don't think anyone seriously doubts
| Anthropic and Google are hauling in serious dough.
|
| The question, as you point out, is how much they are
| keeping. But xAI selling compute doesn't really hide any
| of that. If anything, given the prices Musk is getting,
| it _adds_ to the cost line. (And xAI isn't masking
| compute revenue as Grok's.)
| mceoin wrote:
| Google owns 14% of Anthropic.
| bandrami wrote:
| I think the reference was to Elon giving Dario a two-month
| discount on compute as part of the deal and Dario
| immediately announcing a profitable quarter _based entirely
| on that discount_.
| SilverElfin wrote:
| Anthropic basically did that by getting two months of free
| compute from SpaceX. As I recall, this is how they were able
| to claim that they were profitable. But in reality, they are
| only profitable for those two months.
| reactordev wrote:
| You mean Oracle's customers will face when their renewal bill
| includes infrastructure fees.
| edoceo wrote:
| Like financial reporting and "transparency" that's required for
| public companies.
| AtlasBarfed wrote:
| Capital is going to dry up. All the AI companies are racing to
| get to market before the dumb money disappears
| outside1234 wrote:
| "We want to be ready to grift public money at a moment's notice,
| but there are still opportunities to grift private money right
| now, so we are holding off."
| shimman wrote:
| Growing worry I have are the dozens of newly minted corporate
| elites that will continue to wreck havoc on the tech industry
| mandating their golden paths while America still lacks medicare
| for all, college for all, and universal childcare.
|
| If you think Sam Altman is bad for the industry, imagine what 200
| of him will be like!
| philipallstar wrote:
| We had universal childcare until we converted single-income
| families into dual-income families in order to make the boomers
| who they bought houses from rich.
| lokar wrote:
| And to give women full agency over their own lives
| philipallstar wrote:
| No one has full agency over their life. The men who
| generally work harder, longer, and for more of their lives,
| that are shorter as a result, don't have fully agency.
| Having a boss isn't agency.
| komali2 wrote:
| Ok, then, to give women as much agency as men have.
| asadotzler wrote:
| Women couldn't have bank accounts, in my lifetime.
| CGMthrowaway wrote:
| Ah, money. What life is all about.
| 0xWTF wrote:
| Women want their own income stream because of the innumerable
| ways men get into trouble. If her man gets into trouble, she
| wants a plan B, for her and her children. I don't think
| anyone was thinking about how that would prop up the housing
| market 30 years later.
| CGMthrowaway wrote:
| That's a nice story, but the truth is when women first
| entered the workforce in meaningful numbers, it was
| primarily unmarried women. Society strongly expected women
| to leave the labor force once married, and businesses
| actively banned married women from working
| dofm wrote:
| I was wondering about this the other week.
|
| Is there a chart, somewhere, like a family tree, of what the
| Apple and Microsoft stock "ordinary millionaires" went on to
| do?
| thin_carapace wrote:
| we need more non tech women to marry and divorce craven tech
| men so that at least half of these scrooge like fortunes can
| get donated
|
| edit: id love to tally all the donations done by techies and
| compare them to how much of bezos fortune has ended up routed
| to charity via his ex
| HDBaseT wrote:
| If you're a tech billionaire, you don't marry unless you
| are incredibly stupid.
|
| Altman and Thiel are also gay, so theres that too.
| abuani wrote:
| ... Being gay does not limit altman or theil from getting
| married...
|
| And last I checked, plenty of tech billionaires are
| married and by no stretch of the imagination stupid.
| dofm wrote:
| No idea where this comes from; I wasn't talking about a
| literal family tree but a figurative one (I grew up with
| _Rock Family Trees_ )
|
| Also: Altman _is_ married.
| thin_carapace wrote:
| i think i was trying to make the point that the type of
| person to make a shitload of money tends to be the type
| of person to hold onto a shitload of money
| bpt3 wrote:
| I'm just anticipating the next version of "Community-based
| EBITDA" that sama rolls out in the latest attempt to convince
| everyone that spending >$1 to earn $1 is a good idea.
| guluarte wrote:
| "Hey, don't invest too much in Spacex or Anthropic. We're
| planning an IPO too."
| winfredJa wrote:
| This is the real reason. I don't think equity market has enough
| capital to support three companies of this size.
| vessenes wrote:
| SpaceX IPO is slated to be $75-80bn -- the market has size
| for that. We also have seen robust options and finance
| markets for AAPL and NVDA over the last years that make the
| broader ecosystem not overly worrying in my armchair opinion.
|
| I'm not clear how much crossover demand there is between SX
| and Anthropic/oAI -- that seems like the more interesting
| question. I'm guessing if we had Anthropic/oAI launching at
| the same time we'd see some pretty interesting capital
| dynamics.
| fc417fc802 wrote:
| > if we had Anthropic/oAI launching at the same time
|
| Don't we have exactly that? There are S-1 announcements for
| SpaceX, Anthropic, and OpenAI. Google is selling to raise
| money for infra (IIRC). There's an absurd amount of money
| flowing in at present (prospectively at least).
| XorNot wrote:
| None of these companies are worth the numbers being tossed
| around, but SpaceX especially so.
|
| Its Schrodinger's IPO: the space business is _so_
| successful how could you question the company 's worth? You
| can't afford to miss out on the next biggest AI business to
| invest in!
|
| What's going to happen is the music will stop and it's just
| a question of who cashed in when it does. OpenAI are easily
| the most vulnerable here.
| HDBaseT wrote:
| I was under the impression SpaceX was going to be a
| trillion dollar company.
|
| The media and market is hyping these three companies up to
| be all trillion dollar companies.
| panopticon wrote:
| Afaik SpaceX is only putting 5% of its shares up on the
| public market when it IPOs (newly minted shares, diluting
| the existing private shareholders).
|
| So the markets only "need to absorb" $75B when SpaceX
| IPOs, not its whole $1.7T valuation. At least until the
| lockup period expires.
| HDBaseT wrote:
| Gotcha, that seems a bit more manageable for the market
| to absorb.
|
| I think it will still be a bit tight with Anthropic and
| OpenAI IPO'ing at similar times however.
| fear91 wrote:
| I don't get what's the point of non-profits if you can IPO them.
| How does that make any sense?
| wmf wrote:
| They're IPOing a commercial subsidiary of OpenAI so that it can
| donate even more money to the parent nonprofit.
|
| (Actually the subsidiary is everything and the nonprofit is a
| do-nothing fig leaf but the IRS and Congress seem to not care
| enough to stop them.)
| Yizahi wrote:
| Checks and balances dear sirs and madams, checks and
| balances. Excepts apparently it meant cheques used to top up
| account balances.
| Atreiden wrote:
| But then private shareholders are able to extract shareholder
| value from the subsidiary, so the "nonprofit" component is
| utterly meaningless here.
|
| How is this not illegal? What prevents any nonprofit from
| doing this to sidestep its filing status and extract profit?
| bwhiting2356 wrote:
| not to be a shill, but isn't it good for the non-profit to
| own a big piece of a successful company?
| swores wrote:
| I think it depends on context.
|
| If the private subsidiary was doing semi-unrelated stuff
| to the goals of the non-profit, and using it to fund the
| non-profit, then your logic could make sense - for
| example if a cancer research charity owned a profitable
| business and funnelled the profits up to spend on
| research, great.
|
| But in OpenAI's case, the claimed goals of the non-profit
| were essentially "do AI in a way that puts safety above
| profits". And whether or not one agrees with their
| previous approach to safety, or even whether safety needs
| to be cared about, it's undeniable that the for-profit
| business isn't acting as useful fundraising for the non-
| profit's goals, it's literally acting in the opposite
| direction.
| JumpCrisscross wrote:
| > _it 's undeniable that the for-profit business isn't
| acting as useful fundraising for the non-profit's goals,
| it's literally acting in the opposite direction_
|
| It's generally not up to your or to me, it's up to the
| donors to the non-profit. If what you find to be
| undeniable is very much deniable to them, then that is
| their right.
|
| The only question of public concern is whether OpenAI,
| Inc., a charity, meets the exemption requirements [1].
|
| [1] https://www.irs.gov/charities-non-profits/charitable-
| organiz...
| yieldcrv wrote:
| A few things, but they work very well for our industry.
|
| The rule is that the nonprofit and disqualified persons
| (mostly board members), cant own businesses together, well
| they can but not more than 35% of it together, and a max of
| 20% can have voting capability
|
| The consequences arent immediate, non profits have 3 years
| to correct this
|
| Now in the tech industry, getting VCs involved is already
| the plan from day one and founders get diluted, so getting
| below 35% is either easy, or easy within 3 years
|
| so they're fine
|
| there's a lot of things they can all do to deal with the
| share consolidation
| Tuna-Fish wrote:
| Every step taken by the nonprofit leadership has to be, (or
| at least seem to be at the time), net positive for the
| stated goal of the nonprofit. To be legal, the IPO needs to
| be a net gain for the nonprofit.
|
| It can easily be that, if they believe that the capital it
| raises increases the long-term value of the company by a
| greater multiple than the proportion of the company that is
| lost from the nonprofit to outside investors.
|
| The primary example of this is Novo Nordisk (the Ozempic
| company). Their largest shareholder is, through an
| intermediary, the Novo Nordisk Foundation, which is one of
| the largest charities in the world. Nordisk used to be a
| charity that owned 100% of it's own labs and facilities,
| but in 1989 they realized that they were just too small,
| and would get trampled by larger international players
| without greatly increasing their scope. So they made their
| subsidiary go public (through a complex merger, not an
| IPO), and now only own 28% of it, instead of 100%. But, in
| large part because of the capital that going public brought
| them, despite constantly distributing money for research
| and charity, that's 28% of a company that's more than 100x
| bigger that what they used to be. And they retained 77%
| voting control.
| siren2026 wrote:
| Just the fact that they still calling themselves OpenAI is so
| grotesque.
|
| Similar to Google with "Don't be evil". At least they got the
| decency to eventually remove it when they realized they were
| actually doing evil.
| an0malous wrote:
| There is no point, it's just government sanctioned virtue
| signaling
| tedsanders wrote:
| The nonprofit (OpenAI Foundation) owns ~26% of the for-profit,
| plus some extra warrants.
|
| The for-profit (OpenAI Group PBC) is what's filing the S-1
| Draft.
|
| The OpenAI Foundation also exclusively appoints the board of
| the OpenAI Group PBC and can replace directors at any time.
|
| https://openai.com/our-structure/
|
| (I work at OpenAI, but I am not a lawyer and am not speaking on
| behalf of OpenAI - just sharing my personal understanding.)
| ncruces wrote:
| > The OpenAI Foundation also exclusively appoints the board
| of the OpenAI Group PBC and can replace directors at any
| time.
|
| Isn't it hard to write this with a straight face?
| to11mtm wrote:
| If they truly wanted it to be in the benefit of the not-for-
| profit and safe from interference, the ownership by the
| foundation would be much closer to or just over 50%.... just
| thinking out loud...
| chippiewill wrote:
| The magic 50% ownership isn't relevant for that purpose.
| There are special provisions which means that the
| Foundation effectively exerts full control over the company
| because it appoints the entire board.
| ghshephard wrote:
| See: https://www.axios.com/2023/11/18/how-openai-board-is-
| structu... for the OpenAI Structure.
|
| 1) In order to fund research - this stuff costs 10s of billions
| of dollars - everyone, from Ilya, to Elon, to Sam - all agreed
| that they would require a profit-arm to raise money. Nobody was
| going to sponsor that 10s of billions of dollars to a non-
| profit.
|
| 2) The non profit is still there - and controls the commercial
| element.
| argee wrote:
| > Nobody was going to sponsor that 10s of billions of dollars
| to a non-profit
|
| How much has MacKenzie Scott donated to non-profits again?
|
| Seems like such a claim is on thin ice.
| alpinisme wrote:
| "Controls"
|
| That will be especially untrue after IPO when shareholders
| can claim there are fiduciary responsibilities that conflict
| with the non profit goals.
| super256 wrote:
| The non profit is a big shareholder of the commercial
| subsidiary
| JumpCrisscross wrote:
| > _when shareholders can claim there are fiduciary
| responsibilities that conflict with the non profit goals_
|
| The for-profit has fiduciary responsibility to the non-
| profit as well as other shareholders. The IPO doesn't
| really change that.
| alextheparrot wrote:
| The for-profit is a PBC with the sane mission at the
| nonprofit [0]
|
| [0] https://openai.com/index/built-to-benefit-everyone/
| JumpCrisscross wrote:
| > _non profit is still there - and controls the commercial
| element_
|
| The non-profit hasn't controlled squat since they tried and
| failed to fire Sam Altman.
| spac wrote:
| Novo Nordisk
| cj wrote:
| https://en.wikipedia.org/wiki/Novo_Holdings_A/S
| yieldcrv wrote:
| The corporation selling shares is just primarily owned by the
| non profit
|
| The corporation selling shares is subject to normal corporate
| tax regime
|
| The real answer to your question is that non profits can own
| shares, and there is no legal difference between passive
| investment of other publicly traded companies and highly
| consolidated shares of a private company. In the US it is seen
| as merely happenstance that we have such a liquid market where
| the shares themselves can rapidly change in value and create
| profits, but there is nothing controversial about that.
| cloudengineer94 wrote:
| Here we go
| cloudengineer94 wrote:
| Here we go... Let's see if retail investors are indeed exit
| liquidity or not
| anukin wrote:
| Pretty much is, at this point. Spcx is oversubscribed.
| cj wrote:
| Source
| deadbabe wrote:
| You're always someone's exit liquidity.
| dofm wrote:
| Or just... Americans:
|
| https://www.notus.org/technology/trump-blindsided-ai-compani...
|
| _OpenAI CEO Sam Altman pitched the idea of turning over shares
| in his company to Trump in early 2025 and discussed the matter
| again with senior officials in recent weeks_
| stinger wrote:
| This is like a slack message
| stuxnet79 wrote:
| A very unserious tone from probably the most consequential
| company of our lifetimes. It's vibing all the way to the top I
| guess.
| gordonhart wrote:
| 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!
| Nicholas_C wrote:
| 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.
| stuxnet79 wrote:
| Only thing missing from this comms masterpiece was all
| lowercase.
| shepherdjerred wrote:
| I wish all announcements were this terse and candid
| kylecazar wrote:
| What a weird tone this is written in.
| sigmar wrote:
| I think it is intended to sound like Sam Altman. Would look
| exactly like a tweet of his if it didn't have capitalized
| characters.
| throw03172019 wrote:
| Was this meant as an internal team post?
| lnrd wrote:
| 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
| n42 wrote:
| 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.
| matheusmoreira wrote:
| We all want to sell the top and buy the bottom.
| recursivecaveat wrote:
| Letter dated Feb 28th 2000, NASDAQ would hit the peak of the
| bubble March 10th.
| rfgplk wrote:
| Companies IPOing should be forced to put up their estimated
| market cap as collateral in cash. Oh what is that? You don't have
| $1 trillion in cash to put up? Cool, you're not a $1 trillion
| dollar company then.
| verbify wrote:
| Companies always trade at a premium to book, so how would that
| work?
| missedthecue wrote:
| Last year Chegg was trading below net cash (meaning their
| market cap was smaller than cash in the bank minus debt).
| Might still be, I haven't checked in a while. There were
| maybe a hundred on the Tokyo stock exchange trading below net
| cash.
| lmm wrote:
| Some companies trade at a discount to book value (very normal
| for banks, for example, especially those from e.g. Pakistan).
| csallen wrote:
| This makes no sense. Market cap and cash reserves are two
| different stats for a reason. Why would they need to be the
| same? Just to make things simpler for people who don't actually
| know what market cap means? (Which, granted, is the vast
| majority of people.)
| kommunicate wrote:
| ...what?
| lanthissa wrote:
| the marketcap represents the cashflow estimated by the market
| to be taken out of the business over the lifetime of the
| company discounted today.
|
| your suggestion makes no sense
| twosdai wrote:
| If a company that wanted to IPO had 1 trillion dollars, their
| market cap would have to be larger than their cash holding.
| Their cash on hand is considered or at least should be
| considered in any normal valuation of the company. Because
| shares are ownership of the company.
|
| So a simple valuation would be something like Current Cash +
| Assets + Expected Future cash - (Expenses + Risk)
| farrellm23 wrote:
| This makes no sense: the whole point is to raise capital. The
| valuation is never just the current value of the assets; it's
| based on the expected future cash flows. A good example is in
| biotech, some researcher developed a treatment and wants to
| develop a product. They have valuable IP but zero money. So
| they IPO to raise capital to bring the treatment to market. The
| investors expect that in the future, they will get dividends or
| a buyout.
| echoangle wrote:
| Where would a company ever get their market cap in cash? If
| they had that, wouldn't they by definition have a higher market
| cap, since the value of the company is cash + the rest of the
| company?
| JumpCrisscross wrote:
| > _since the value of the company is cash + the rest of the
| company?_
|
| Failing companies sometimes trade below cash value. OP's
| basically creating a rule by which only failing companies are
| allowed to go public. (Or those who have paid a king's ransom
| to a megabank.)
| jandrese wrote:
| In theory the purpose of an IPO is to raise cash to expand a
| company. If the company already has the cash they don't need to
| do an IPO.
| sciencejerk wrote:
| When/how are IPO dates released?
| JumpCrisscross wrote:
| > _When /how are IPO dates released?_
|
| Once the SEC declares a registration statement "effective," the
| company is subject to the Exchange Act's reporting
| requirements. Theoretically one can do this and not list one's
| shares. That's dumb, so nobody does it.
|
| In practice, we'll get a couple weeks to possibly days ahead of
| the listing. That process is partly governed by the SEC
| accepting the company's S-1. It's mostly down to negotiations
| between the company, its underwriters and IPO investors.
| dzonga wrote:
| why not let it be public ?
| thallavajhula wrote:
| Elon is not going to be happy about this. He's been vocal about
| his dislike towards the business model OpenAI chose to run with.
| jorblumesea wrote:
| that's not the issue, Elon is just a petulant child that is
| losing the ai game ever since he left OAI. Elon wanted full
| control, and that dispute over control is the central issue.
|
| Elon is 100% a for profit person, it's just a 10 year rivalry
| between Sam and Elon.
| thallavajhula wrote:
| And to top that, he lost the battle in the court recently.
| nkozyra wrote:
| Elon wanted precisely the same model.
| bandrami wrote:
| I personally think Elon is willing to take a hit on SpaceX's
| IPO Friday because he knows it will suck the air out of Sam's
| attempt at exiting.
| cco wrote:
| Here is my low key prediction about the purchase of Cursor by
| Elon.
|
| Cursor is purportedly a huge customer of OAI, maybe a top five?
| I think Elon bought it to have leverage on sama.
|
| If timed correctly, Elon could pull the plug on a huge customer
| (Cursor) the quarter before OAI try to IPO.
| jordemort wrote:
| I have instructed my financial advisor to keep my exposure to the
| upcoming wave of AI IPOs as close to zero as possible.
| shermantanktop wrote:
| So...all cash?
| system2 wrote:
| I'd assume healthcare would be the answer.
| zerobees wrote:
| Given that the US govt is reportedly talking to OpenAI about
| taking a stake, your only choice might be Zimbabwean dollars.
| lifeisstillgood wrote:
| I find the irony delicious that this S1 will be fed into ChatGPT
| so often looking for flaws and edge cases that the LLM will
| develop sentience just to tell people to stop...
| chronci3740 wrote:
| Too late.
|
| Interest in the SpaceX, Anthropic, and OpenAI IPO is already
| dropping
| lellow wrote:
| Why do you say this? It's OK to make such a bold statement, but
| you gotta share how you came to this conclusion. This helps
| with a good discussion.
| chakintosh wrote:
| I have a feeling that as soon as OpenAI and Anthropic stocks are
| up for grabs, the market will implode.
| inatreecrown2 wrote:
| yep, same here.
| lbrito wrote:
| Same. Glad I'm not alone.
| brazukadev wrote:
| I think that might not even happen depending on how SpaceX IPO
| goes.
| andsoitis wrote:
| > the market
|
| Which market? The stock market? Or the tech stocks? Or
| something else?
| system2 wrote:
| Then someone says the market; they definitely mean the stock
| market. I don't know what else you can understand from it.
| baby_souffle wrote:
| > Which market? The stock market? Or the tech stocks?
|
| Both.
|
| Across the entire stock market, not a ton of bright spots
| _except_ for Tech.
|
| Take a look here: https://finviz.com/map?t=sec_all&st=w52
| dwa3592 wrote:
| implode as in? to the moon or crash into bits and pieces?
| Groxx wrote:
| Implode generally implies shrinking/collapsing, so while
| explode is kinda ambiguous, I think this is fairly clearly
| saying "bubble will pop".
| levocardia wrote:
| So are you short the market?
| sometimelurker wrote:
| crashes aren't shortable unless you know exactly when they
| are going to happen
| mrcwinn wrote:
| Which is great because the parent comment provides a
| precise timeline.
| zulban wrote:
| Maybe lay down some concrete numbers and timelines, hold
| yourself accountable, otherwise you risk confirmation bias with
| your predictions like millions before you.
| sc68cal wrote:
| "Markets can stay irrational longer than you can stay
| solvent."
| jansan wrote:
| Starting the first three sentences with "We" does not pass the
| Voigh-Kampff / "I am not a robot" test.
| zuzululu wrote:
| so who is buying at the open? anthropic, spacex, openai
|
| i think that we are going to see another leg up but this is gonna
| be it for a while
| stingraycharles wrote:
| From what I understand, SpaceX has been engineered such that
| all kinds of passive investment funds (pension funds, ETFs)
| will buy into it at their first rebalancing, and as such it
| should get a decent amount of volume after open.
|
| Having said that, it's the company I have least faith in due to
| the recent acquisition of xAI / Twitter.
| blourvim wrote:
| I heard that the rule changes which would allow SpaceX to be
| auto bought by those funds has been blocked, previous stock
| seasoning rules will apply
| JumpCrisscross wrote:
| > _the rule changes which would allow SpaceX to be auto
| bought by those funds has been blocked_
|
| Nothing was blocked. S&P 500 never adopted them.
| Influencers misunderstood what a consultation document is
| and presented a question as a _fait accompli_.
|
| NASDAQ 100 changed its rules, as did S&P and Russell's
| total-market funds. But for NASDAQ 100 I'm going to go
| ahead and say this was a brilliant market move, since
| nobody _ever_ talked about that index before this.
| kasey_junk wrote:
| Crsp changed as well.
| JumpCrisscross wrote:
| > _Crsp changed as well_
|
| Yes. For their total-market fund. That makes sense. (CRSP
| is probably the most-significant index to make the
| change. But even then, it won't be a significant source
| of demand. Total market means _lots_ of components.)
| siren2026 wrote:
| > But for NASDAQ 100 I'm going to go ahead and say this
| was a brilliant market move, since nobody ever talked
| about that index before this.
|
| Most people know the NASDAQ100 as its ticker QQQ. Also
| known as the high risk - high reward investment.
|
| After reading how Nasdaq changed the rules in order to
| court all the mega IPOs to list with them, I will never
| ever consider a Nasdaq fund again. The rule change about
| the available float is especially shocking.
| JumpCrisscross wrote:
| > _After reading how Nasdaq changed the rules in order to
| court all the mega IPOs to list with them, I will never
| ever consider a Nasdaq fund again_
|
| We have zero evidence for that chain of causation. And we
| have zero evidence of significant outflows for NASDAQ 100
| since this rule change. (There is early evidence of
| _inflows_ , but I suspect that's just because nobody
| talked about the NASDAQ 100 before and this turned out to
| be a brilliant marketing move.)
| siren2026 wrote:
| 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.
| JumpCrisscross wrote:
| > _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 float, not all of all of the
| companies. But I haven't seen research to say one way is
| definitively better than the other.
|
| I agree they should have probably paired the float-rule
| change with a gradual onramp. But again, NASDAQ 100 isn't
| big enough to really _need_ to care about this. (Half a
| trillion is obviously a lot of money. But not relative to
| the equity markets, and not when spread across a hundred
| of the largest names.)
| siren2026 wrote:
| > 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.
| JumpCrisscross wrote:
| > _No the float rule is to avoid having to buy so much
| stock compared to the available stock that it would
| create irrational prices_
|
| Correct.
|
| > _this is probably going to happen with those IPOs_
|
| Not due to any index-following investor.
|
| > _SP500 can decide absolutely whatever they want_
|
| Yup, S&P 500 is a committee-based index.
|
| > _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_
|
| S&P never changed the S&P 500's rules.
|
| NASDAQ 100 did. But from what I can tell, that was a
| brilliant piece of marketing. Nobody talked about them
| before. (QQQQ doesn't appear to have gained or lost net
| assets in that time, which isn't unexpected, it's a
| volatile fund.)
| dakolli wrote:
| S&P is no longer allowing this, only the NASDAQ. I think the
| bigger risk would be if they were included in the S&P
| 100/500. There was too much backlash.
|
| These capitalists are taking advantage of the corrupt
| administration in charge at the moment (not that a blue admin
| would be that much better), but they can get away with almost
| everything at the moment. Keep your head on a swivel, the
| billionaire class knows they don't have to worry about going
| to jail for the next few years and they'll make sure to screw
| everyone they possibly can to satisfy their endless greed.
|
| Death to the fascist insect that feeds on the blood of the
| people.
| JumpCrisscross wrote:
| > _There was too much backlash_
|
| There wasn't. A consultation was rejected. It happens all
| the time. If S&P management had a say, they would have
| wanted SpaceX included.
| JumpCrisscross wrote:
| > _SpaceX has been engineered such that all kinds of passive
| investment funds (pension funds, ETFs) will buy into it_
|
| Pension funds are rarely passively run. They tend to be
| sophisticated investors. For example, several pension funds
| are _already_ investors in SpaceX.
|
| NASDAQ 100 will include SpaceX after a couple weeks. But it's
| a tech fund. It's strange to complain about buying the
| largest tech company in a tech fund. Similarly, S&P total
| market and Russell total market will buy early. But again,
| those are total-market funds. If you want to actively manage
| your portfolio, don't buy total-market funds.
| SwellJoe wrote:
| The cheap money for subsidizing tokens has begun to run out. Not
| all gone, yet, but it's getting harder to pretend the chatbots
| are cost-effective to run. Soon, they're going to need to tap a
| larger pool for money: Everyone's retirement accounts.
| mgraczyk wrote:
| The numbers are public now, this is obviously false
| SwellJoe wrote:
| Which public numbers are you referring to that contradict
| what I said?
| paustint wrote:
| If SpaceX, OpenAI, and Anthropic get fast tracked to be on
| NASDAQ or S&P 500 then they are required to be included in
| index funds which will be automatically included in
| retirement accounts and that will give investors an exit.
|
| https://youtu.be/yhRjvX_t4hc?si=N-a-s_5ttWKfVeJZ
| siren2026 wrote:
| yes it will keep the grift going for a couple months due to
| the index artificial demand. Actually, SpaceX timed the
| unlocking of their shares to the timeline index funds will
| have to buy.
|
| Guess who will hold the bag when it's all going downhill?
| JumpCrisscross wrote:
| > _If SpaceX, OpenAI, and Anthropic get fast tracked to be
| on NASDAQ or S &P 500_
|
| S&P 500 said no. NASDAQ 100 is a tiny tech index. The
| retirement conspiracy could have been a thing, and its
| effect isn't zero, but oh my god was it overblown by the
| influencer crowd.
| applfanboysbgon wrote:
| "Nothing happened on Y2K, everyone was overreacting"
| JumpCrisscross wrote:
| The notion that S&P's committee took online chatter into
| account is silly beyond explanation. If anything, S&P
| management would have put their fingers on the scale to
| _include_ these new issues.
| lelanthran wrote:
| > The numbers are public now,
|
| Where?
| brikym wrote:
| Let me guess... wall street bets is going to pump $OPEN stock?
| derwiki wrote:
| That would make my portfolio's day!
| dominotw wrote:
| showoff
| voganmother42 wrote:
| Good thing they bought that podcast...
| thedogeye wrote:
| I thought this was about the college football conference for a
| second.
| fHr wrote:
| codex is great
| moralestapia wrote:
| [meta, off-topic but relevant]
|
| Maybe the solution to s..tposters is to do what Wikipedia does.
|
| Some articles/topics are "protected" and new/unverified accounts
| cannot touch them.
| to11mtm wrote:
| 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.
| gekoxyz wrote:
| While I agree on the smell I think that the situations are
| really different. I am not an economist but I think that other
| than the situation of the huge amount of money in play we are
| in a really different case. The general user (and I have
| noticed it especially with today's WWDC) basically doesn't get
| _any_ benefit from AI (neither LLMs, image generation or photo
| editing). They were promised living like in Wall-e in 5 years
| and they are basically still living the same life. White collar
| jobs slightly benefited from the LLMs and same with programmers
| (while many say that they can get huge leverage the public
| results of what software companies produce didn 't get the same
| benefit). Everyone knows the market will crash, nobody knows
| how much.
| charcircuit wrote:
| There is ton of utility. I use it all the time to study, to
| look up what's happening in the world, to understand the
| context behind what others are saying, cooking recipes, and
| much more. Considering LLMs have access to tools for
| searching the internet they have a superset of the
| capabilities of Google and consumers got a lot of value from
| Google. In fact from putting ads on the search results Google
| has made billions of dollars from such consumers getting
| value from their service.
| Eufrat wrote:
| When you ask it to give you a digest of current events or
| as a study aid how are you ensuring that what your reading
| is a valid representation of the source material? Has it
| never given you false information?
| thimabi wrote:
| Not OP but, anyway, AI output should be treated like any
| other source material.
|
| I study from reputable sources every day and never cease
| to be amazed by how many errors or misconceptions they
| have. Peer-reviewed articles, books from renowned
| scholars, news from major publications... regardless of
| the source, false information and contradictions
| accumulate. I'd wager that AI, besides helping me uncover
| these issues in the literature, has had a lower error
| rate than most of the materials that I read on a daily
| basis.
| base698 wrote:
| My father in law owns a small manufacturing business and is
| not technical at all. His computer skills stop with some CAD
| and basic excel. He pays for ChatGPT as does his wife and her
| kids. The internet and dot com bubble didn't have millions
| and millions of non technical users paying cash for a
| product. Almost every coffee shop I go to has people talking
| about AI and ChatGPT even in areas with no tech populations.
|
| I still think it could crash, but it's got real users and a
| mind share like nothing I've ever seen.
| Waterluvian wrote:
| I definitely believe in the broad existence of people like
| your father in law. What I'm not sure about is how many of
| them would keep paying if their subscriptions were priced
| profitably.
| mmcwilliams wrote:
| This seems to ignore the fact that millions of non-
| technical people did pay cash for a product: AOL. And in
| fact the AOL buyout of Time Warner coincided almost exactly
| with burst of the dot com boom.
| JumpCrisscross wrote:
| > _the AOL buyout of Time Warner_
|
| To be clear, there is a world of difference between IPOs
| and LBOs. In the risk they create. And in the risk they
| signal.
| jrmg wrote:
| _The internet and dot com bubble didn 't have millions and
| millions of non technical users paying cash for a product_
|
| The dot com bubble was basically based on regular people
| buying computers and internet service, and then using them
| to buy products they used to buy in stores.
| 100ms wrote:
| The question in my mind is persistence. Everyone goes
| through the honeymoon phase. I'm absolutely loathing the
| idea that phones are arriving soon with chatbot junk built
| deeply into it, enough that the thought is more what if I
| could maybe just stop using my phone so much. I threw
| myself at the Llama WhatsApp integration when I first got
| it, now the idea of having Llama in WhatsApp just feels so
| dumb.
|
| I was a huge early fan of ChatGPT voice too, but I don't
| think I've used voice mode anywhere in at least 6 months.
| The question is what is the right level people are
| generally going to settle on for the use of these tools in
| the long term. 80% of my usage isn't much more than a
| better Google, I could live without it and I could live
| with cheaper options. I'm not sure the consumer money is
| going to be there en masse as hoped
|
| Of course it still leaves a huge amount of business cases
| open, but I suppose the same principle applies. How soon
| will people tire of talking to robo-voice when they call
| their bank? etc.
| LargeWu wrote:
| These companies are never, ever going to make their money
| back off of retail customers. It's not even clear if those
| customers would be profitable at all, let alone enough to
| justify hundreds of billions in capital expenditures.
| jghn wrote:
| > I think that the situations are really different
|
| Keep in mind that people said this before both of those
| crashes.That's the problem with bubbles. It's impossible to
| say if this time really IS different.
| hypendev wrote:
| I wouldn't argue the same.
|
| My parents love using ChatGPT, asking it all kinds of
| questions. My mom discovered Claude and helps her immensely
| with her job - where she would have to take it home and work
| a few hours to be able to finish the tasks on her computer,
| as her company that still uses Office 98, now Claude does it
| in 5 minutes.
|
| They fixed so many random issues using it, it is insane. My
| dad had a bike issue which would otherwise be solved by
| either trying to find obscure manuals from 20 years ago on
| random forums with me translating it from english to our
| language, or by taking it to a mechanic which could take
| months. This way, he just snapped a few photos, said what the
| problem is, and in a few minutes he had the fix.
|
| I've built software that uses LLM's for a specific usecase -
| besides general adoption, professionals in the field
| contacted me and thanked me for making their lives easier, as
| the tasks would often take a lot of manual work. These people
| are earning way more from using my software, than I am from
| their subscriptions, which is still about 20x more than my
| API costs are.
|
| While most non-dev people are behind the curve, the impact it
| has on their lives is becoming bigger and bigger by the day.
| magarnicle wrote:
| Office _98_
| gekoxyz wrote:
| Maybe I downplayed it too much but I really think this is
| still "in distribution" (we always have to remember that we
| are tech savy people and we influence the people that
| surround us). I see the value, but in my opinion it's not a
| generational opportunity, but a great acceleration. We are
| treating it like generational opportunity. That's why I say
| "everyone know there will be a crash, but noone knows how
| big that will be". The AI industry is not (in my opinion
| obviously) worth $ 391B [1] of added value.
|
| [1] https://www.grandviewresearch.com/industry-
| analysis/artifici...
| hypendev wrote:
| It is still "in distribution", that is why when its
| "distributed" properly, it will surely add much, much
| more value to the economy.
|
| But it is a generational opportunity - we can remove a
| lot of barriers that come with knowledge, lack of it,
| access to it and more. Someone can easily get pretty on
| point medical advice without access to doctors. Get
| specific engineering advice without engaging with those
| engineers. We can apply common sense or specific
| knowledge on scale - in a world where about 50% of people
| have IQ under 100 and access to knowledge is gated behind
| lines and payments, this has a huge chance ot improve
| their lives.
|
| And there is the whole shadow inference economy - just
| for example, a few corporations I have worked with in
| insurance and telecommunications have been slowly
| introducing it inside their workflows and their data
| tooling, being able to clean data, tag it, analyse it in
| a way that before would probably cost them billons in
| human costs.
|
| One of them has a database going back to the 80's, with
| data being formatted and reformatted in all shapes and
| sizes, coming back all the way from paper records for
| some of their oldest clients. Cleaning this up was
| unimaginable before as a "something we can do in a day"
| project, but was more of a "possible with insane costs".
| This lead to all further activity being shaped by
| decisions someone made 40+ years ago, details being lost,
| data being thrown away or saved in random notes.
|
| And there's millions of companies like that all around
| the world, which can now do "impossible" and become much
| more efficient and productive for a much cheaper price
| and in way less time than ever.
| xyst wrote:
| Got to payout the investors before the burst
| jtolmar wrote:
| There was a similar wave of IPOs with Uber and AirB&B, not tied
| to a bubble popping.
|
| (I mean, I think this looks incredibly like a bubble too, but
| for completeness sake, that's the counterexample I can think
| of.)
| ai-x wrote:
| 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% and loses 50%, you can't claim
| you were right.
|
| Both OpenAI and Anthropic have already gained 1000% since 2023
| (In Anthropic's case almost 10,000%)
| awwaiid wrote:
| 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.
| ai-x wrote:
| 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
| siren2026 wrote:
| Depending on how much that bubble will pop, all of those
| above might still be very right.
|
| We could very well go back to the 2021 valuations.
| siren2026 wrote:
| Ben Felix got a great video on this subject:
| https://www.youtube.com/watch?v=iOyFja87uyw
|
| The point he makes is that companies go public when they think
| they can get the maximum our of their shares on the retail
| market. Which make sense I guess.
|
| But the fact that the 3 of them are hitting the public market
| at the same time means they all came to the conclusion that now
| is the perfect time to unload those shares. Probably because
| they know there is a high chance of a big crash coming after.
|
| I will not touch those IPOs with a 10 feet long pole. But
| unfortunately a lot of people are about to get burned.
|
| My prediction is that this is what will be remembered as the
| last bit of exuberance before everything starts to unravel.
|
| Books will be written about how insiders will be profiting
| millions by unloading those shares to the greatest fools and
| middle class america.
| teaearlgraycold wrote:
| I'm also staying away. I need to not lose money more than I
| need to gain money.
| JumpCrisscross wrote:
| > _point he makes is that companies go public when they think
| they can get the maximum our of their shares on the retail
| market_
|
| I think this is what's going on right now. But there are a
| variety of reasons that can drive IPO timing. Need for cash
| and owners needing liquidity being chief among them.
|
| I'd also say that post-Covid, retail has become a commanding
| section of the American equity markets in a way I don't think
| they've been in my lifetime. As a result, _every_ IPO from
| now on will have to target retail.
| siren2026 wrote:
| Both OpenAI and Anthropic were able to raise astronomical
| amount of cash on the private markets just weeks ago. I
| don't think that's what's driving them.
|
| I really think 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.
|
| And You can only do that through a full IPO. All those
| companies had private secondary transaction but none of
| them were big enough to transfer the Trillions of $
| required for the insiders to unload their bags.
| JumpCrisscross wrote:
| > _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 fantastically.
| siren2026 wrote:
| > 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 carefully orchestrated PR game that is
| relying on retail to be the ultimate fool. I guess to
| some level every IPO is like that (A PR game to hype the
| company).
|
| But never before had we 3 mega IPOs happening at almost
| the exact same time with so much money to unload on
| retails with dubious ways to force funds to gobble them.
|
| Most IPOs end up negative after the first few quarters
| (at least compared to the SP500). When we are talking
| about a 20B$ company it matters less than 5T$ being
| suddenly fully unloaded on the public.
|
| > And Uber and Airbnb's IPO investors made of
| fantastically.
|
| Did they? https://www.alphaspread.com/comparison/nasdaq/a
| bnb/vs/indx/g...
|
| The only way they might have is by getting the shares at
| the actual IPO price, and even then it's around the same
| as the SP500 return since then.
| JumpCrisscross wrote:
| > _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?
| siren2026 wrote:
| > Source?
|
| There is an actual ETF tracking IPOs:
| https://finance.yahoo.com/quote/IPO/
| JumpCrisscross wrote:
| > _There is an actual ETF tracking IPOs_
|
| Renaissance's IPO index seeks to "capture the essence of
| IPO activity and performance of newly public companies"
| [1]. It does not replicate an actual IPO investor's
| returns.
|
| For example, it adds new issues approximately quarterly
| and never earlier than 5 days from IPO. This is important
| since it misses the pop. Mean (median) first-day returns
| on IPOs are 20% (7%) [2]. The average 3-year buy-and-hold
| return for _all_ IPO investors 1980 to 2025 was 19.1%.
| Less than broad-market indices (though that margin
| shrinks for $1bn+ sales IPOs). But certainly not
| negative.
|
| (Uber and Airbnb reflect this trend. Up since IPO. But,
| as you observe, below the S&P 500's returns even before
| taking into account total returns.)
|
| [1] https://www.lseg.com/content/dam/ftse-
| russell/en_us/document...
|
| [2] https://site.warrington.ufl.edu/ritter/files/IPO-
| Statistics.... _1980 to 2025; 30% (14%) for 2025_
| s1artibartfast wrote:
| Is it bad for insiders to want out? Is it bad for owners
| to sell when they think it is overpriced?
|
| I think this is extremely common, if not necessary, part
| of a functioning market and price discovery. It happens
| with not just IPOs but also secondary offerings.
|
| Some of this seems like dumb retail wanting to
| toughtlessly buy without consideration of risk.
| HerbManic wrote:
| 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.
| system2 wrote:
| What a shitty company, and this shitty announcement proves they
| are going to be shittier after the IPO.
| toufka wrote:
| How much did Apple (via Google (via xAI (via SpaceX))) just crush
| their product?
|
| Seems an awful lot like Apple will commoditize the models that
| power Siri, and just "sherlocked" a trillion dollar private
| company.
| BudaDude wrote:
| If you think Apple just sherlocked OpenAI, you havn't been
| paying attention to the pivot OpenAI has been doing for the
| last 7 months
| dominotw wrote:
| whats the pivot? codex superapp?
| wyager wrote:
| Apple has completely dropped the ball on every single detail of
| AI rollout for the last 5 years - why do you think they will
| suddenly stop now? My prior is that the new siri stuff is just
| as vaporware as the previous "apple intelligence" rollout
| JumpCrisscross wrote:
| > _Apple has completely dropped the ball_
|
| Apple has sat out a capital-allocation shitshow. Its
| investors and likely customers are better off for their
| patience.
| boringg wrote:
| Jury is out on that one -- will have to see what happens in
| the next couple of years. I don't think you can say better
| off with full confidence right now. Very possible you could
| say that in the future..
| JumpCrisscross wrote:
| > _will have to see what happens in the next couple of
| years. I don 't think you can say better off with full
| confidence right now_
|
| We can't say for confidence they'll find a niche in the
| AI world. But we _can_ say they probably sat out some
| value-destroying capital investment. Like, I don 't think
| Apple is going to wind up strategically _worse_ off than
| Meta. But it won 't have blown a metaverse on this.
| lelanthran wrote:
| > I don't think you can say better off with full
| confidence right now.
|
| Of course we can - they managed to avoid spending 100s of
| billions while still giving their users AI...
|
| There is no future in which the entire world is beholden
| to the current VC-backed companies for AI. IOW, there is
| no moat.
| wyager wrote:
| That would be a valid explanation if they hadn't totally
| oversold and underdelivered on "apple intelligence". In
| reality, this explanation is just cope
| MattDamonSpace wrote:
| Ehhh if you squint, everything they announced today was
| announced in 2024.
|
| Doesn't seem like they changed their ideas much (I'm sure
| some iteration occurred but still) and the issue was the
| tech didn't took 2 years to become workable
|
| Feature set is borderline identical
| s1artibartfast wrote:
| Why would Apple even want to be a big player? They aren't
| major players in search or advertising, so it seems less
| likely to disrupt them if they sit it out. There are reasons
| why shareholders might want companies to stay out radically
| different Technologies unless they are at risk of losing
| their business model.
|
| It's not an existential risk to them unless they make it one
| by going all in.
| cmiles8 wrote:
| Unless the picture and trajectory changes dramatically I don't
| see OpenAI managing to pull off a successful IPO. If they do
| manage to go public it will likely only be at a fraction of what
| they're worth now, with existing investors rushing for the exits
| to avoid completely losing their shirts.
|
| The revenue trajectory is now anemic, no clear sign of stopping
| the cash burn anytime soon, and all the liability associated with
| all things Sam Altman at this point. Frankly it's a mess.
|
| In Warren Buffet's Cinderella party scenario it's 11:59 at the
| party and someone just found an accurate clock.
| pseudosavant wrote:
| It is increasingly look like OpenAI, Anthropic, and SpaceX (xAI)
| are going to burst their own AI bubble by going public. Their
| businesses aren't ready for that kind of quarter-by-quarter
| grinding scrutiny. It is going to be bad when their lockup
| periods end.
| ifwinterco wrote:
| Bubble has to burst at some point, so IPO now and at least get
| some exit liquidity. If you wait too long you'll never be able
| to exit at all.
|
| I think that's the thought process and why they're in such a
| rush. In fact all three are in a sort of race, you probably
| don't want to be the last one to IPO
| joxdosba wrote:
| Like the TSLA bubble has burst?
| lelanthran wrote:
| > It is increasingly look like OpenAI, Anthropic, and SpaceX
| (xAI) are going to burst their own AI bubble by going public.
|
| They don't really have a choice - there is a finite amount of
| money in the open market, and the first one to IPO is going to
| get the lion's share of that money.
| merelydev wrote:
| In the last week Alphabet has positioned itself to go on the
| offense, going after exccess liquidity and excess compute.
|
| I fear that OpenAi and Anthropic would not be able to compete
| against an adveserial Alphabet which owns it's own models,
| hardware, large corpus of data, talent and network effects. My
| prediction is that OpenAI and Anthropic will eventually be
| crushed by Alphabet as they run out of investment and compute,
| leaving Alphabet to have a monopoly on AI, at least in the west.
|
| This is why I think OpenAI and Anthropic should really be one
| company, if they join forces and pool together investments and
| compute they'll stand a chance.
| lelanthran wrote:
| > My prediction is that OpenAI and Anthropic will eventually be
| crushed by Alphabet as they run out of investment and compute,
| leaving Alphabet to have a monopoly on AI, at least in the
| west.
|
| It's the other way around (but the result would be the same):
| Alphabet has no need to make a 100x exit for the investors, and
| so can offer the service at cost + %markup, while Anthropic and
| OpenAI are VC funded, meaning that they need to show 10x - 100x
| exit for the investors.
|
| IOW, there is no moat, Alphabet would have market-related
| pricing while VC-backed corps cannot offer market-related
| pricing.
| s1artibartfast wrote:
| Fun idea, but they may be better competition coming Competing
| with Google with different teams, models, and business
| strategies. Im sure google will also be happy selling the adds
| they put in their models for 1/3 of the revenue.
|
| The scary thing for google is if the AI companies start moving
| into ad targeting and open sales portals.
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