> If OpenAI had a sound business plan and was on strong financial footing, they'd have IPO'd.

OTOH, if a company has a sound business plan and strong financial footing it may not need to IPO -- unless the founders or VCers want out ASAP.

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socializer an hour ago | parent | next [-]

They do because the other part of the equation is that they need to keep spending a lot of money to build out infrastructure faster than their two most significant competitors, one of which is public and wildly profitable (for non-AI reasons) and another has already filed for IPO. So it puts them at a disadvantage to walk away from a massive cash infusion.

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spott 17 minutes ago | parent | next [-]

I think the answer is simply that private money is cheaper than public money for these companies right now.

OpenAI hasn’t had any problems getting impressive amounts of funding. So why ipo?

	▲	socializer 2 minutes ago \| parent [-]
		Two reasons. First, there's more money in the public markets, and Altman's appetite seems insatiable; and second, public money comes with fewer strings attached - private investors want protections, board seats, etc.

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25 minutes ago | parent | prev [-]

[deleted]

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Ekaros 16 minutes ago | parent | prev | next [-]

At scale that OpenAI is valued at public markets are only place with enough of liquidity. At smaller scale private equity is an option. But if you are speaking of near trillion scale it really is not.

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ForHackernews 18 minutes ago | parent | prev | next [-]

The investors need to make a couple trillion dollars soon or it all falls apart, right? Maybe I misunderstand how the financing for this works, but my understanding is they have borrowed and set on fire an enormous pile of money as a sacrifice to summon the Machine-God.

If He fails to arrive, or arrives late, they will be the railroad financiers in the Panic of '73.

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Aurornis an hour ago | parent | prev | next [-]

I don't know why comments pointing out this simple fact are getting downvoted.

The oversimplified view that has been drilled into startup discussions for years has been that IPO is the singular goal for every startup and they need to get there as fast as possible, but that hasn't been true for a long while. There are high profile examples like Stripe with no intent to go public any time soon. Some public companies are even gradually doing share buybacks partially to remove their public exposure.

Being a public company kind of sucks in many ways. I'll admit my sample size is small, but every post-IPO CEO I've known has expressed some regrets about going public. It was a fascinating revelation to me after being raised on the idea that IPO is the ultimate victory goal of every startup.

	▲	freecodeio 6 minutes ago \| parent \| next [-]
		lol but they're trying to IPO, it's what sam altman has been talking about for the past 2 years? Are you saying you know something better about sam altman than his public opinions?
	▲	sodapopcan 33 minutes ago \| parent \| prev \| next [-]
		I'm guessing downvotes are not because people don't understand that this happens, but because based on OpenAI's words and actions it is highly unlikely that this is what they are doing. Also, Stripe has been confirmed to be profitable.
	▲	watwut 27 minutes ago \| parent \| prev [-]
		I understand it as IPO is the ultimate victory for investors. They finally get their reward, sell in the overpriced moment and can go their merry way.

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SoftTalker an hour ago | parent | prev | next [-]

VCs always want out when they've made their return. They are not in the business of owning companies for income.

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vkou an hour ago | parent | prev [-]

The founders and VCs can shell shares to private investors, it's the employees who are sitting on options who get fucked.

Whatever private-market liquidity events they will be permitted to participate in will be highly disadvantaged compared to the other two groups.

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besterman23 30 minutes ago | parent [-]

Unhinged conspiracy, if you take the implicit goals of AI research orgs at face value (I.e., replacing all knowledge work) and assume it possible; why would they drag a few thousand knowledge workers along to the promised land when they can just shed them after their usefulness has worn out?

What does adding a few more suckers to the pile of tens of millions of other suckers do to those that get the real benefits? It’s not like after they achieve their goals, the people who helped them would have the ramp or resources to recreate the process.

	▲	lenerdenator a minute ago \| parent [-]
		That then begs the question of whether there's any promised land at all after all knowledge work is replaced. If you've made tens of millions of people unemployed over the timeline of a few years, then you no longer have nearly the market to sell goods and services - including your AI - to. Assuming these guys answer that with "let's make UBI" - which is a huge assumption given the way SV fetishizes those who "create value" and looks down upon those who don't - you now basically have tech feudalism. The remaining upper crust "generously" pays the rest of the population enough to not starve until they die. You'll basically have an entire society in stasis, with no hope of improving their lot, being given the bare minimum to keep humans alive, if that. Well, no hope of peacefully improving their lot. It won't be a promised land at that point.