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My mother asked me a few days ago how to invest in ChatGPT. I explained that it's probably the easiest expressed with some long dated ITM calls on MSFT Anyone

My mother asked me a few days ago how to invest in ChatGPT. I explained that it's probably the easiest expressed with some long dated ITM calls on MSFT Anyone know if MSFT actually has equity in OpenAI or if its just a "mutual partnership" ?

m348e912 4y ago
Before thinking about investing in AI, it might be worth watching the all in podcast from last week (not the most recent one) https://www.youtube.com/watch?v=qQ544sWC8ZQ https://www.youtube.com/watch?v=qQ544sWC8ZQ I am not saying the hosts are right about everything but they made a point that the first to the market may not be the eventual winner and provided some examples of how revolutionary ideas such as a cell phone/smart phone were iterated several times before major leaders broke away. The same can be seen with search and other technologies.
- inconceivable 4y ago
  right, but was openai "first to market"? google and amazon have had AI offerings for a while now.
  - tough 4y ago
    Was apple ever first to market anything?
    - addisonl 4y ago
      It’s this simple, something that a surprising number of intelligent people fail to grasp. Apple was rarely the first to it, they just did it well. Google and other giants had the technology but they never made a super powerful chatbot available to everyone with the ingredients they had on hand. Now they’re scrambling.
    - senttoschool 4y ago
      The iPhone was the first to market for many things including an all-screen phone, multi-touch, full-web browser experience on a mobile device.
      - ccakes 4y ago
        Palm would like to talk to you
      - fxtentacle 4y ago
        No. It was the first good device with those features. But I skipped the first iPhone because at the time, my Palm appeared to be superior.
  - endisneigh 4y ago
    Both Amazon and Google did not have usable language models prior to ChatGPT. Certainly ML was used, but not in that particular application.
- fswd 4y ago
  this was reeeaaallly f good. Thanks
NicoJuicy 4y ago
It's a delicate one. I would bet on Alphabet for the long term, the original inventors of the paper, together with DeepMind. But chatgpt like tech could have an effect on their advertising income. The question would be if it affects their advertising or if it actually adds a service to sell to their pool. If it adds a service to their pool, both Alphabet and Microsoft could be winners. But it takes a huge amount of profits/revenue for a service to have any affect on the stock price for both of them. Additionally, AWS and Meta won't stand by. We've all seen how much Meta is prepared to fund Zucks vision and that's transformers now. They even released one before ChatGPT. https://www.technologyreview.com/2022/11/18/1063487/meta-large-language-model-ai-only-survived-three-days-gpt-3-science/ https://www.technologyreview.com/2022/11/18/1063487/meta-lar... Additionally, besides the impact, it's possible that it's not going to be as profitable as one would expect ( eg. because of price pressure due to competition)
- jerrygenser 4y ago
  There's been a brain drain from alphabet, why do you bet despite this?
  - rvnx 4y ago
    Most of the people from the original Transformers left Google as far as I know, (including for OpenAI), so... NicoJuicy: Have you ever tried Bard, the "ChatGPT-Killer" (English-only btw) ?
    - NicoJuicy 4y ago
      No, I didn't. I know the results aren't that good yet. My guess was that they didn't apply RLHF much. There's going to be plenty of research coming in that area, I suppose.
- spaceman_2020 4y ago
  I can’t bet on Alphabet with the current leadership. You either need a visionary CEO or the original founders to have the courage to gut your entire revenue stream (ads) in pursuit of a new tech. Pichai is not that guy.
JumpCrisscross 4y ago
> it's probably the easiest expressed with some long dated ITM calls on MSFT Just buy equity. No need to sidecar long vol in the middle of a resolving banking crisis. > if MSFT actually has equity in OpenAI or if its just a "mutual partnership" Yes, Microsoft are taking a significant stake in OpenAI. But it’s not equity, because OpenAI isn’t a corporation. (Partnership interests. Economically similar.)
- swyx 4y ago
  > No need to sidecar long vol in the middle of a resolving banking crisis. as a former options trader, yup excellently put. love that this kind of "sophistication" (its simple in the grand scheme of things, but it passes) is here on HN. +1. stop using options for leverage if dont have a view on vol. way cheaper ways to borrow money.
  - eaenki 4y ago
    what ways are cheaper to borrow money / leverage to be long MSFT?
    - swyx 4y ago
      not at all being condescending but if you dont know you may be better off not knowing, leverage is a mean master. answer is margin accounts at any brokerage.
user_named 4y ago
Wouldn't buying the MSFT stock be easier?
- bob1029 4y ago
  This is what I do. Also helps that I like the rest of the business. For me, this is mostly a win-win arrangement - I believe strongly in GitHub/Visual Studio/.NET/Azure/etc too. If you dont believe in MSFT but want to invest in OpenAI, buying their stock is probably a terrible idea. You would be purchasing a gigantic liability (relative to your risk preferences) in hopes of gaining access to a miniscule component of the overall business.

m348e912 4y ago

Before thinking about investing in AI, it might be worth watching the all in podcast from last week (not the most recent one) https://www.youtube.com/watch?v=qQ544sWC8ZQ https://www.youtube.com/watch?v=qQ544sWC8ZQ I am not saying the hosts are right about everything but they made a point that the first to the market may not be the eventual winner and provided some examples of how revolutionary ideas such as a cell phone/smart phone were iterated several times before major leaders broke away. The same can be seen with search and other technologies.

inconceivable 4y ago
right, but was openai "first to market"? google and amazon have had AI offerings for a while now.
- tough 4y ago
  Was apple ever first to market anything?
  - addisonl 4y ago
    It’s this simple, something that a surprising number of intelligent people fail to grasp. Apple was rarely the first to it, they just did it well. Google and other giants had the technology but they never made a super powerful chatbot available to everyone with the ingredients they had on hand. Now they’re scrambling.
  - senttoschool 4y ago
    The iPhone was the first to market for many things including an all-screen phone, multi-touch, full-web browser experience on a mobile device.
    - ccakes 4y ago
      Palm would like to talk to you
    - fxtentacle 4y ago
      No. It was the first good device with those features. But I skipped the first iPhone because at the time, my Palm appeared to be superior.
- endisneigh 4y ago
  Both Amazon and Google did not have usable language models prior to ChatGPT. Certainly ML was used, but not in that particular application.
fswd 4y ago
this was reeeaaallly f good. Thanks

NicoJuicy 4y ago

It's a delicate one. I would bet on Alphabet for the long term, the original inventors of the paper, together with DeepMind. But chatgpt like tech could have an effect on their advertising income. The question would be if it affects their advertising or if it actually adds a service to sell to their pool. If it adds a service to their pool, both Alphabet and Microsoft could be winners. But it takes a huge amount of profits/revenue for a service to have any affect on the stock price for both of them. Additionally, AWS and Meta won't stand by. We've all seen how much Meta is prepared to fund Zucks vision and that's transformers now. They even released one before ChatGPT. https://www.technologyreview.com/2022/11/18/1063487/meta-large-language-model-ai-only-survived-three-days-gpt-3-science/ https://www.technologyreview.com/2022/11/18/1063487/meta-lar... Additionally, besides the impact, it's possible that it's not going to be as profitable as one would expect ( eg. because of price pressure due to competition)

jerrygenser 4y ago
There's been a brain drain from alphabet, why do you bet despite this?
- rvnx 4y ago
  Most of the people from the original Transformers left Google as far as I know, (including for OpenAI), so... NicoJuicy: Have you ever tried Bard, the "ChatGPT-Killer" (English-only btw) ?
  - NicoJuicy 4y ago
    No, I didn't. I know the results aren't that good yet. My guess was that they didn't apply RLHF much. There's going to be plenty of research coming in that area, I suppose.
spaceman_2020 4y ago
I can’t bet on Alphabet with the current leadership. You either need a visionary CEO or the original founders to have the courage to gut your entire revenue stream (ads) in pursuit of a new tech. Pichai is not that guy.

JumpCrisscross 4y ago

> it's probably the easiest expressed with some long dated ITM calls on MSFT Just buy equity. No need to sidecar long vol in the middle of a resolving banking crisis. > if MSFT actually has equity in OpenAI or if its just a "mutual partnership" Yes, Microsoft are taking a significant stake in OpenAI. But it’s not equity, because OpenAI isn’t a corporation. (Partnership interests. Economically similar.)

swyx 4y ago
> No need to sidecar long vol in the middle of a resolving banking crisis. as a former options trader, yup excellently put. love that this kind of "sophistication" (its simple in the grand scheme of things, but it passes) is here on HN. +1. stop using options for leverage if dont have a view on vol. way cheaper ways to borrow money.
- eaenki 4y ago
  what ways are cheaper to borrow money / leverage to be long MSFT?
  - swyx 4y ago
    not at all being condescending but if you dont know you may be better off not knowing, leverage is a mean master. answer is margin accounts at any brokerage.

user_named 4y ago

Wouldn't buying the MSFT stock be easier?

bob1029 4y ago
This is what I do. Also helps that I like the rest of the business. For me, this is mostly a win-win arrangement - I believe strongly in GitHub/Visual Studio/.NET/Azure/etc too. If you dont believe in MSFT but want to invest in OpenAI, buying their stock is probably a terrible idea. You would be purchasing a gigantic liability (relative to your risk preferences) in hopes of gaining access to a miniscule component of the overall business.