[simianwords]

... you think this is vindicating Ed Zitron? The dude is on a spree claiming the bubble will burst any time soon [1]. In fact Ed Zitron predicted that OpenAI will IPO sooner and not later [2]! This whole post is yet again another thing that he got wrong.

[1] https://www.youtube.com/results?search_query=ed+zitron+bubbl...

[2] https://www.wheresyoured.at/openai-cfo-news

> It's clear that both OpenAI and Anthropic are rushing toward a public offering so that their CEOs can cash out, and that their underlying economics are equal parts problematic and worrying.

[jrflowers]

I like that people will post stuff like “Ed Zitron is always wrong! Look at this wrong claim he made!” and then link to him not making that claim at all.

“Rushing toward a public offering so that their CEOs can cash out” is not a prediction of a specific time to IPO, and is supported by OpenAI’s own public statement two months after that was published

https://openai.com/index/openai-submits-confidential-s-1/

[simianwords]

I don't even know what you are trying to say, I opened your link

> 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. But it’s a complicated set of tradeoffs and this gives us the option to go public sooner if that ends up being best.

So... OpenAI has specifically said that they have not decided on the timing and it may be a while. And now we have news that they are waiting till next year.

What do you think is supported by whom? Being more clear and concrete helps the discussion.

[jrflowers]

>it may be a while

Or sooner. It says sooner or later. It only means “later” if you don’t read the “sooner” part. Choosing to read selectively isn’t One Weird Trick To Own A Blogger. “This post about submitting a draft S1 to the SEC is proof that they don’t want to go public” lmao

[lovich]

> Choosing to read selectively isn’t One Weird Trick To Own A Blogger.

I mean it’s pretty obvious that the pro AI as an industry wide replacement people think it is One Weird Trick. I’ve still yet to see any of them articulate how they are going to reach profitability without resorting to the meme of projecting that their baby has doubled size in 6 months so is projected to reach 10.5 trillion pounds by the age of 10.

[therobots927]

OAI canceling an IPO this year a week after he released their dogshit financials is not a coincidence and yes it does vindicate him.

He’s not shorting the market or calling a top. He’s saying that the bubble will pop because the underlying business model is and always will have a NEGATIVE ROI. Unless you’re speculating on semiconductor stocks the difference is irrelevant.

Do me a favor and tell me how much of the 1,000,000,000,000 spent / committed to a datacenter buildout has been returned to shareholders / creditors?

[JumpCrisscross]

> OAI canceling an IPO this year a week after he released their dogshit financials

There is zero evidence of any causal link between him and this. The obvious one, instead, is SpaceX's volatility.

> Do me a favor and tell me how much of the 1,000,000,000,000 spent / committed to a datacenter buildout has been returned to shareholders / investors?

If Anthropic also delays its IPO, you'll have a point.

[dofm]

> There is zero evidence of any causal link between him and this.

How would there be? He's a blogger and a youtuber, they are a private company with secretive financials, bankers involved in pre-IPO work don't talk openly. Nobody is going to say "we only decided not to do this because of a youtuber" because that would make them look like the ill-informed, over-eager idiots they've been to let this nonsense get this far.

Why would there be any concrete evidence it was down to him specifically, and not, say, dozens of finance people saying "what the *fuck* is that marketing budget about — that's so large it looks like something's been hidden in it" after reading about it from him and the FT and everyone else who was involved.

[SpicyLemonZest]

In what way is SpaceX's volatility an obvious cause? It would be one thing if SpaceX was down from its IPO price, but it's not, it's just down from a post-IPO peak. To me this has all the hallmarks of a backfilled rationalization.

> OpenAI’s advisers presented company executives with the option of waiting until 2027 to go public with a $1 trillion valuation, or lower the targeted valuation for a quicker I.P.O. Mr. Altman, said one person in contact with him on the topic, responded that any change to the trillion-dollar valuation was a nonstarter.

I really don't know how to read this and reach any conclusion other than, OpenAI leadership won't accept what financial analysts consider to be a rational valuation of its stock.

[JumpCrisscross]

> In what way is SpaceX's volatility an obvious cause?

Let me amend: it's a more-obvious cause given it's pertinent new information in a way Zitron partially leaking financials many institutional investors have already seen is not.

> don't know how to read this and reach any conclusion other than, OpenAI leadership won't accept what financial analysts consider to be a rational valuation of its stock

Neither did SpaceX and, as you say, it's trading above its IPO price and placing tens of billions of dollars of debt.

I think Zitron's analysis was on the balance good, though it didn't say a lot of what folks on here seem to have taken away (e.g., about OpenAI's inference being marginally unprofitable). It seems he's got a bit of a cult of personality around him, which makes me inherently sceptical. But it's a pretty ridiculous reach to claim OpenAI had to delay its IPO because of him versus the much-more visible and talked about thing.

[SpicyLemonZest]

Perhaps we're really on the same page. I don't think OpenAI executives read the Zitron article and said "oh my god now we can't IPO!"; I think they're both downstream of the underlying bad financials, which SpaceX only managed to mitigate due to the Elon Musk personality trade. (And I agree that this theory falsifiably predicts Anthropic will also find a reason to delay.)

[JumpCrisscross]

> they're both downstream of the underlying bad financials, which SpaceX only managed to mitigate due to the Elon Musk personality trade

Idk, I'm still sceptical how someone could look at the market right now and conclude that it's suddenly hyperaware of financial metrics.

For whatever reason–maybe it's corporate-structure complexity, maybe it's lawsuits–OpenAI was always at the end of the pack of AI IPOs. If SK Hynix take August and Anthropic September or October, that would mean a 2026 OpenAI IPO would have to (a) coincide with one of those or (b) go to market during an election/post-election fiasco and/or the holidays. The realistic options were July or October, the latter being between a likely Anthropic IPO and the midterms. The timing just doesn't make sense and maybe someone realise that.

[therobots927]

SpaceX demonstrated that the public markets have a limited tolerance for a multi-trillion dollar company that doesn’t make any money.

Ed’s leaks demonstrated that OAI doesn’t make money (even on inference).

Put these two together and I think the conclusion is pretty obvious.

[jsnell]

> Ed’s leaks demonstrated that OAI doesn’t make money (even on inference).

They did not.

[lovich]

Oh? They’re profitable now? Or anywhere close to it?

[jsnell]

No, but the GP wasn't satisfied with that, and had to put in a snide "even on inference" parenthetical. The leaks showed inference having positive margins.

The Zitronites will say that the data is fraudulent, and OpenAI must have classified some of their inference as marketing, or R&D, or some other wacky theory of the week. But the actual data does not show that. It is made up.

If you want to cherry-pick the worst parts from the leak and disbelieve the more positive ones, it feels like you're not in a great place epistemically...

[JumpCrisscross]

> SpaceX demonstrated that the public markets have a limited tolerance for a multi-trillion dollar company that doesn’t make any money

What? How? SpaceX loses oodles of money. It's trading above its IPO, and just filled an oversubscribed bond deal.

> Put these two together and I think the conclusion is pretty obvious

Zitron has a faithful following. He isn't a broadly-influential analyst.

[simianwords]

1. they didn't cancel their IPO and they were deliberate about having the option to time their IPO

2. he has tried over and over again to predict the bubble and peak [1] [2] [3]

3. that OpenAI is filing for an IPO next year is no vindication of Ed's claim when he specifically predicted the opposite (as I showed in the above comment)

4. OpenAI filing for an IPO next year has no bearing on its fundamentals

5. on Datacenters: Anthropic had to lease it from Elon's datacenter because they were too short on capacity and every one was complaining that their limits were too low

[1] Ed on 2024, "threaten to begin a collapse that I’ve been predicting since March" https://www.wheresyoured.at/burst-damage/

[2] Ed on 2024, "three quarters to prove itself before the apocalypse comes" https://www.wheresyoured.at/peakai/

[3] Ed on 2024, "things are beginning to collapse" https://www.wheresyoured.at/subprimeai/

Edit: the quality of discussion in this website is annoying sometimes.get downvoted for good faith discussion

[JumpCrisscross]

> Edit: the quality of discussion in this website is annoying sometimes.get downvoted for good faith discussion

Ignore it and don't do this: "Please don't comment about the voting on comments. It never does any good, and it makes boring reading."

https://news.ycombinator.com/newsguidelines.html

[CodingJeebus]

OpenAI did confidentially file their S-1, which costs a ton of money to put together for the bankers and regulators to review. They did test the market and it looks like either the banks or people directly around Altman told him not to move forward. That doesn't mean Zitron was wrong about OpenAI IPOing. They took steps in that direction and then decided not to move forward. That's not his fault.

As far as the bubble bursting soon, we are starting to see some pretty concerning signals. The South Korean stock market triggered trading circuit breakers twice earlier this week to stop a runaway selloff in the tech sector. For reference, circuit breakers have only been triggered in the Korean market 10 times in history, and only 5 times ever in the US markets.

https://finance.yahoo.com/markets/world-indices/articles/kos...

[dofm]

FWIW I think there's a "Y2K never happened" future here, where the bubble never bursts (in the sense of some insane market valuation proving to be lunatic) but everyone does what they can to make sure it doesn't burst on them, and they pull back and the bubble just deflates.

Take for example the action on SPACs that made the "SPAC everything" era end.