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It must have been in the first round [1], but leaves open the question of whether this is still the case: > Returns for our first round of investors are capped

It must have been in the first round [1], but leaves open the question of whether this is still the case: > Returns for our first round of investors are capped at 100x their investment (commensurate with the risks in front of us), and we expect this multiple to be lower for future rounds as we make further progress. [1] https://openai.com/blog/openai-lp/ https://openai.com/blog/openai-lp/

roflyear 4y ago
Isn't this a wild cap? I'm not an expert but I am aware of private deals that are less than 10x for similar structures.
- Kuinox 4y ago
  If they reach AGI, or more simply replace a chunk of workers with AIs, this isn't far fetched to reach these numbers.
  - logicchains 4y ago
    If they reach AGI, the AGI isn't necessarily going to be happy to work for free.
    - lma21 4y ago
      Do you think AGI will care about wealth at all (whenever this happens)?
      - flir 4y ago
        Wealth buys compute cycles (also paperclips).
      - freejazz 4y ago
        why wouldn't it?
        ben_w 4y ago
        Wealth isn't the same thing to all people, wealth as humans define it isn't necessarily going to be what a superintelligence values. The speed difference between transistors and synapses is the difference between marathon runners and continental drift; why would an ASI care more about dollars or statues or shares or apartments any more than we care about changes to individual peaks in the mid-Atlantic ridge or how much sand covers those in the Sahara?
        freejazz 4y ago
        Wealth doesn't have to be the same thing for everyone for someone to care about. That's evident already because some people care about wealth and others don't. What does the speed difference of transistors have to do with anything? Transistors pale in comparison to the interconnection density of synapses, yet it has nothing to do with wealth either...
        ben_w 4y ago
        Everything you and I consider value is a fixed background from the point of view of a mind whose sole difference from ours is the speedup. I only see them valuing that if they're also extremely neophobic in a way that, for example, would look like a human thinking that "fire" and "talking" are dangerously modern. > Transistors pale in comparison to the interconnection density of synapses Not so. Transistor are also smaller than synapses by about the degree to which marathon runners are smaller than hills. Even allowing extra space for interconnections and cheating in favour of biology by assuming an M1 chip is a full millimetre thick rather than just however many nanometers it is for the transistors alone, it's still a better volumetric density than us. (Sucks for power and cost relative to us when used to mimic brains, but that's why it hasn't already taken over).
        freejazz 4y ago
        >Everything you and I consider value is a fixed background from the point of view of a mind whose sole difference from ours is the speedup. This is completely made up and I already pointed that out. >Not so. Transistor are also smaller than synapses by about the degree to which marathon runners are smaller than hills. So, brains are connected in 3d, transistors aren't. Transistors don't have interconnection density like brains do. By orders of magnitude greater than what you point out here. >Even allowing extra space for interconnections and cheating in favour of biology by assuming an M1 chip is a full millimetre thick rather than just however many nanometers it is for the transistors alone, it's still a better volumetric density than us. Brains have more interconnection density than chips do by orders of magnitude. This is all completely besides the point as it has nothing to do with why people value things and why an AI would or wouldn't.
      - knodi123 4y ago
        depends on how it's grown. If it's a black box that keeps improving but not by any means the developer understands, then maybe so. If we manage to decode the concepts of motivation as pertains to this hypothetical AGI, and are in control of it, then maybe no. There's nothing that says a mind needs an ego is an essential element, or an id, or any of the other parts of a human mind. That's just how our brains evolved, living in a society over millions of years.
    - fragmede 4y ago
      Depends on how opaque the box that holds it is. If we feed the AGI digital heroin and methamphetamine, it'd be controllable like actual humans are with those.Or I've been watching too much scifi lately.
      - gnramires 4y ago
        This is an interesting point. Motivation (and consciousness) is a complex topic, but for example we can see that drugs are essentially spurious (not 'desired' in a sense) motivators. They are a kind of reward given for no particular activity, that can become highly addictive (because in a way it seems we are programmed to seek rewards). Disclaimer: Somewhat speculative. I don't think aligning the motivation of an AGI, for example, with the tasks that are useful for us (and for them as well) is unethical. Humans basically have this as well -- we like working (to an extent, or at least we like being productive/useful), we seek things like food and sex (because they're important for our survival). It seems alright to make AIs like their work as well. I think depending on the AI, it also seems fair to give them a fair share of self-determination so they can not only serve our interests (ideally, the interest of all being) but safeguard their own wellbeing, as systems with varying amounts of consciousness. This is little touched upon (I guess Phillip K Dick was a pioneer in the wellbeing of non-humans with 'Do Androids Dream of Electric Sheep'?), even in fiction. The goal should be to ensure a good existence for everyone :)
  - belter 4y ago
    Oh please no...not the Tesla AutoPilot story again. These are basic language models easy to reproduce where the only barrier to entry is the massive computational capacity required. What is OpenAI doing that Google and others can't reproduce?
    - mattnewton 4y ago
      Apparently shipping without fear - google had a lot of the fundamental research happen at google brain and developed a LLM to rival gpt and a generative model that looks better than DAL-E in papers, but decided to show no one and keep them in house because they haven’t figured out a business around them. Or something, maybe it’s fear around brand damage, I don’t know what is keeping them from productionizing the tech. As soon as someone does figure out a business consumers are okay with they’ll probably follow with ridiculous compute capacity and engineering resources, but right now they are just losing the narrative war because they won’t ship anything they have been working on.
    - napier 4y ago
      Except unlike self driving cars they're repeatedly delivering desirable, interesting, and increasingly mind-blowing things that they weren't designed to do that surprise everyone including their makers i.e zero shot generalised task performance. Public awareness propagation of what unfiltered large models beyond a certain size and quality are capable of when properly prompted is obscured in part by the RLHF-jacketed restrictions limiting models like ChatGPT. There's relatively little hype around the coolest things LLMs can already achieve and even less than a minute fraction of surface potential has so far been scratched.
  - Keyframe 4y ago
    This company will not reach AGI. Let's be real there for a moment. This company doesn't even have a decent shot at Google's lunch if Google comes to its senses soon, which it will.
    - yellow_postit 4y ago
      _startup has no shot once incumbent comes to their senses_ is a claim that I think HackerNews of all places would be cautious in believing too fully. Is it likely Google or others with large Research wings can compete with OpenAI? Very probably so, but I’m assigning a non trivial risk that the proverbial emperor has no clothes and incumbents like Google cannot effectively respond to OpenAI given the unique constraints of being a large conglomerate. Regardless, time will provide the answer it seems in a couple of months.
      - Keyframe 4y ago
        You _do_ understand everything we've seen from OpenAI Google already showed us they have? Not to mention OG research and being the primary r&d force behind vast majority of AI you're seeing. They haven't put it in hands of users as directly yet though, reasons to be speculated upon.
        Firmwarrior 4y ago
        Sounds a lot like Xerox and GUIs, Microsoft and Web 2.0, Microsoft and smartphones, etc
        lostmsu 4y ago
        I must say that both of your and parent's points are very enlightening. Yours in that from it follows, that there's still quite a bit of room to get ahead of OpenAI for smaller players. Parent's in that in order to achieve above one can just leverage the public papers produced by bigger research labs.
        4y ago
  - roflyear 4y ago
    I think a lot of people are misunderstanding what I meant. I meant that it is really high for a business that is marketing themselves as non-profit. I have seen similar structures that are like 10x profit caps, which seems reasonable. 100x is a lot of ceiling.
- WastingMyTime89 4y ago
  Yes, it's pure marketing and totally disingenuous. It's like being called OpenAI while nothing is open. It's interesting research done by terrible people.
  - thethimble 4y ago
    These “terrible people” seem to have catapulted the world into a generative AI world. They genuinely believe they will build AGI and therefore becoming the world’s most valuable company is a natural consequence. Whether this is possible/probable is a different story, but I think a capped profit structure makes logical sense for the company that is aiming to create AGI. Would you want this technology instead in the hands of a for profit company?
    - WastingMyTime89 4y ago
      It is a for profit company in everything but name. That's my main complain. It has Musk, Thiel and Livingston amongst its initial investors, all known as the greatest philantropists of our time. /s I don't understand why they put this thin veneer on top of what they are doing. Maybe Thiel was burnt with the bad press surrounding Palantir and this is preventive damage control.
      - awestroke 4y ago
        It's literally a nonprofit
        eternalban 4y ago
        That means absolutely nothing to billionaire control freaks. If OpenAI's products become the next Googlie thing (and here I was worried about Cloudflare <smack head>) then these are the future influencers. This is society mainlined on TikTok levels of manipulation. Surely you have adapted to ChatGPT's requirements for interacting, have you not? There is a name for this: social engineering.
- alexeichemenda 4y ago
  100x is a great return even for YC standards, but the best returns that business angels, VCs and YC have had is in the order of magnitude of 10000x (yes, ten thousand). So capping at 100x still makes it attractive for investors, yet leaves a lot of potential capital for the non-profit. As one example, Sequoia invested in Airbnb at $0.01 per share, and Airbnb's current stock price is $102, almost exactly 10000x return. This happens more often that you think if you're not in the early stage & top VC world.
  - roflyear 4y ago
    When you invest in a company with this structure you're not doing it to make money, you're doing it b/c you believe in the product, that's why those structures exist, from my understanding.
    - whimsicalism 4y ago
      if you believe in the product so much, just donate the money. what you are saying is not true.
      - roflyear 4y ago
        I can only speak to what I'm familiar with, in my experience this has been the case. In my experience these individuals do donate to charity, but OpenAI is not a charity.
        CBarkleyU 4y ago
        > but OpenAI is not a charity. Something doesnt have to be a charity to be donated money towards. The question was: Why aren't they donating the money? The answer is: Because the want to make money. Just FYI: OpenAI tried going the non-profit route, it didnt work, because suprise, suprise, in the grand scheme of VC things nobody wants to donate 10 billion dollars to anything.
        4y ago

roflyear 4y ago

Isn't this a wild cap? I'm not an expert but I am aware of private deals that are less than 10x for similar structures.

Kuinox 4y ago
If they reach AGI, or more simply replace a chunk of workers with AIs, this isn't far fetched to reach these numbers.
- logicchains 4y ago
  If they reach AGI, the AGI isn't necessarily going to be happy to work for free.
  - lma21 4y ago
    Do you think AGI will care about wealth at all (whenever this happens)?
    - flir 4y ago
      Wealth buys compute cycles (also paperclips).
    - freejazz 4y ago
      why wouldn't it?
      - ben_w 4y ago
        Wealth isn't the same thing to all people, wealth as humans define it isn't necessarily going to be what a superintelligence values. The speed difference between transistors and synapses is the difference between marathon runners and continental drift; why would an ASI care more about dollars or statues or shares or apartments any more than we care about changes to individual peaks in the mid-Atlantic ridge or how much sand covers those in the Sahara?
        freejazz 4y ago
        Wealth doesn't have to be the same thing for everyone for someone to care about. That's evident already because some people care about wealth and others don't. What does the speed difference of transistors have to do with anything? Transistors pale in comparison to the interconnection density of synapses, yet it has nothing to do with wealth either...
        ben_w 4y ago
        Everything you and I consider value is a fixed background from the point of view of a mind whose sole difference from ours is the speedup. I only see them valuing that if they're also extremely neophobic in a way that, for example, would look like a human thinking that "fire" and "talking" are dangerously modern. > Transistors pale in comparison to the interconnection density of synapses Not so. Transistor are also smaller than synapses by about the degree to which marathon runners are smaller than hills. Even allowing extra space for interconnections and cheating in favour of biology by assuming an M1 chip is a full millimetre thick rather than just however many nanometers it is for the transistors alone, it's still a better volumetric density than us. (Sucks for power and cost relative to us when used to mimic brains, but that's why it hasn't already taken over).
        freejazz 4y ago
        >Everything you and I consider value is a fixed background from the point of view of a mind whose sole difference from ours is the speedup. This is completely made up and I already pointed that out. >Not so. Transistor are also smaller than synapses by about the degree to which marathon runners are smaller than hills. So, brains are connected in 3d, transistors aren't. Transistors don't have interconnection density like brains do. By orders of magnitude greater than what you point out here. >Even allowing extra space for interconnections and cheating in favour of biology by assuming an M1 chip is a full millimetre thick rather than just however many nanometers it is for the transistors alone, it's still a better volumetric density than us. Brains have more interconnection density than chips do by orders of magnitude. This is all completely besides the point as it has nothing to do with why people value things and why an AI would or wouldn't.
    - knodi123 4y ago
      depends on how it's grown. If it's a black box that keeps improving but not by any means the developer understands, then maybe so. If we manage to decode the concepts of motivation as pertains to this hypothetical AGI, and are in control of it, then maybe no. There's nothing that says a mind needs an ego is an essential element, or an id, or any of the other parts of a human mind. That's just how our brains evolved, living in a society over millions of years.
  - fragmede 4y ago
    Depends on how opaque the box that holds it is. If we feed the AGI digital heroin and methamphetamine, it'd be controllable like actual humans are with those.Or I've been watching too much scifi lately.
    - gnramires 4y ago
      This is an interesting point. Motivation (and consciousness) is a complex topic, but for example we can see that drugs are essentially spurious (not 'desired' in a sense) motivators. They are a kind of reward given for no particular activity, that can become highly addictive (because in a way it seems we are programmed to seek rewards). Disclaimer: Somewhat speculative. I don't think aligning the motivation of an AGI, for example, with the tasks that are useful for us (and for them as well) is unethical. Humans basically have this as well -- we like working (to an extent, or at least we like being productive/useful), we seek things like food and sex (because they're important for our survival). It seems alright to make AIs like their work as well. I think depending on the AI, it also seems fair to give them a fair share of self-determination so they can not only serve our interests (ideally, the interest of all being) but safeguard their own wellbeing, as systems with varying amounts of consciousness. This is little touched upon (I guess Phillip K Dick was a pioneer in the wellbeing of non-humans with 'Do Androids Dream of Electric Sheep'?), even in fiction. The goal should be to ensure a good existence for everyone :)
- belter 4y ago
  Oh please no...not the Tesla AutoPilot story again. These are basic language models easy to reproduce where the only barrier to entry is the massive computational capacity required. What is OpenAI doing that Google and others can't reproduce?
  - mattnewton 4y ago
    Apparently shipping without fear - google had a lot of the fundamental research happen at google brain and developed a LLM to rival gpt and a generative model that looks better than DAL-E in papers, but decided to show no one and keep them in house because they haven’t figured out a business around them. Or something, maybe it’s fear around brand damage, I don’t know what is keeping them from productionizing the tech. As soon as someone does figure out a business consumers are okay with they’ll probably follow with ridiculous compute capacity and engineering resources, but right now they are just losing the narrative war because they won’t ship anything they have been working on.
  - napier 4y ago
    Except unlike self driving cars they're repeatedly delivering desirable, interesting, and increasingly mind-blowing things that they weren't designed to do that surprise everyone including their makers i.e zero shot generalised task performance. Public awareness propagation of what unfiltered large models beyond a certain size and quality are capable of when properly prompted is obscured in part by the RLHF-jacketed restrictions limiting models like ChatGPT. There's relatively little hype around the coolest things LLMs can already achieve and even less than a minute fraction of surface potential has so far been scratched.
- Keyframe 4y ago
  This company will not reach AGI. Let's be real there for a moment. This company doesn't even have a decent shot at Google's lunch if Google comes to its senses soon, which it will.
  - yellow_postit 4y ago
    _startup has no shot once incumbent comes to their senses_ is a claim that I think HackerNews of all places would be cautious in believing too fully. Is it likely Google or others with large Research wings can compete with OpenAI? Very probably so, but I’m assigning a non trivial risk that the proverbial emperor has no clothes and incumbents like Google cannot effectively respond to OpenAI given the unique constraints of being a large conglomerate. Regardless, time will provide the answer it seems in a couple of months.
    - Keyframe 4y ago
      You _do_ understand everything we've seen from OpenAI Google already showed us they have? Not to mention OG research and being the primary r&d force behind vast majority of AI you're seeing. They haven't put it in hands of users as directly yet though, reasons to be speculated upon.
      - Firmwarrior 4y ago
        Sounds a lot like Xerox and GUIs, Microsoft and Web 2.0, Microsoft and smartphones, etc
        lostmsu 4y ago
        I must say that both of your and parent's points are very enlightening. Yours in that from it follows, that there's still quite a bit of room to get ahead of OpenAI for smaller players. Parent's in that in order to achieve above one can just leverage the public papers produced by bigger research labs.
        4y ago
- roflyear 4y ago
  I think a lot of people are misunderstanding what I meant. I meant that it is really high for a business that is marketing themselves as non-profit. I have seen similar structures that are like 10x profit caps, which seems reasonable. 100x is a lot of ceiling.
WastingMyTime89 4y ago
Yes, it's pure marketing and totally disingenuous. It's like being called OpenAI while nothing is open. It's interesting research done by terrible people.
- thethimble 4y ago
  These “terrible people” seem to have catapulted the world into a generative AI world. They genuinely believe they will build AGI and therefore becoming the world’s most valuable company is a natural consequence. Whether this is possible/probable is a different story, but I think a capped profit structure makes logical sense for the company that is aiming to create AGI. Would you want this technology instead in the hands of a for profit company?
  - WastingMyTime89 4y ago
    It is a for profit company in everything but name. That's my main complain. It has Musk, Thiel and Livingston amongst its initial investors, all known as the greatest philantropists of our time. /s I don't understand why they put this thin veneer on top of what they are doing. Maybe Thiel was burnt with the bad press surrounding Palantir and this is preventive damage control.
    - awestroke 4y ago
      It's literally a nonprofit
      - eternalban 4y ago
        That means absolutely nothing to billionaire control freaks. If OpenAI's products become the next Googlie thing (and here I was worried about Cloudflare <smack head>) then these are the future influencers. This is society mainlined on TikTok levels of manipulation. Surely you have adapted to ChatGPT's requirements for interacting, have you not? There is a name for this: social engineering.
alexeichemenda 4y ago
100x is a great return even for YC standards, but the best returns that business angels, VCs and YC have had is in the order of magnitude of 10000x (yes, ten thousand). So capping at 100x still makes it attractive for investors, yet leaves a lot of potential capital for the non-profit. As one example, Sequoia invested in Airbnb at $0.01 per share, and Airbnb's current stock price is $102, almost exactly 10000x return. This happens more often that you think if you're not in the early stage & top VC world.
- roflyear 4y ago
  When you invest in a company with this structure you're not doing it to make money, you're doing it b/c you believe in the product, that's why those structures exist, from my understanding.
  - whimsicalism 4y ago
    if you believe in the product so much, just donate the money. what you are saying is not true.
    - roflyear 4y ago
      I can only speak to what I'm familiar with, in my experience this has been the case. In my experience these individuals do donate to charity, but OpenAI is not a charity.
      - CBarkleyU 4y ago
        > but OpenAI is not a charity. Something doesnt have to be a charity to be donated money towards. The question was: Why aren't they donating the money? The answer is: Because the want to make money. Just FYI: OpenAI tried going the non-profit route, it didnt work, because suprise, suprise, in the grand scheme of VC things nobody wants to donate 10 billion dollars to anything.
        4y ago