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I think you're playing a different game than the Sam Altmans of the world. The level of investment and profit they are looking for can only be justified by crea

I think you're playing a different game than the Sam Altmans of the world. The level of investment and profit they are looking for can only be justified by creating AGI. The > 100 P/E ratios we are already seeing can't be justified by something as quotidian as the exceptionally good productivity tools you're talking about.

gizajob 2y ago
Yeah I keep thinking this - how is Nvidia worth $3.5Trillion for making code autocomplete for coders
- drawnwren 2y ago
  Nvidia was not the best example. They get to moon in the case that any AI exponential hits. Most others have less of a wide probability distribution.
  - BeefWellington 2y ago
    Yeah they're the shovel sellers of this particular goldrush. Most other businesses trying to actually use LLMs are the riskier ones, including OpenAI, IMO (though OpenAI is perhaps the least risky due to brand recognition).
    - lokimedes 2y ago
      Or they become the Webvan/pets.com of the bubble.
      - zeusk 2y ago
        Nvidia is more likely to become CSCO or INTC but as far as I can tell, that's still a few years off - unless ofcourse there is weakness in broader economy that accelerates the pressure on investors.
    - gizajob 2y ago
      I’d say it’s more about the fact that they make useful products rather than brand recognition.
  - HarHarVeryFunny 2y ago
    I'm not sure about that. NVIDIA seems to stay in a dominant position as long as the race to AI remains intact, but the path to it seems unsure. They are selling a general purpose AI-accelerator that supports the unknown path. Once massively useful AI has been achieved, or it's been determined that LLMs are it, then it becomes a race to the bottom as GOOG/MSFT/AMZN/META/etc design/deploy more specialized accelerators to deliver this final form solution as cheaply as possible.
deleted 2y ago
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JumpCrisscross 2y ago
> level of investment and profit they are looking for can only be justified by creating AGI What are you basing this on? IT outsourcing is a $500+ billion industry. If OpenAI et al can run even a 10% margin, that business alone justifies their valuation.
- HarHarVeryFunny 2y ago
  It seems you are missing a lot of "ifs" in that hypothetical! Nobody knows how things like coding assistants or other AI applications will pan out. Maybe it'll be Oracle selling Meta-licenced solutions that gets the lion's share of the market. Maybe custom coding goes away for many business applications as off-the-shelf solutions get smarter. A future where all that AI (or some hypothetical AGI) changes is work being done by humans to the same work being done by machines seems way too linear.
  - JumpCrisscross 2y ago
    > you are missing a lot of "ifs" in that hypothetical The big one being I'm not assuming AGI. Low-level coding tasks, the kind frequently outsourced, are within the realm of being competitive with offshoring with known methods. My point is we don't need to assume AGI for these valuations to make sense.
    - HarHarVeryFunny 2y ago
      Current AI coding assistants are best at writing functions or adding minor features to an existing code base. They are not agentic systems that can develop an entire solution from scratch given a specification, which in my experience is more typcical of the work that is being outsourced. AI is a tool, whose full-cycle productivity benefit seems questionable. It is not a replacement for a human.
      - JumpCrisscross 2y ago
        > they are not agentic systems that can develop an entire solution from scratch given a specification, which in my experience is more typcical of the work that is being outsourced If there is one domain where we're seeing tangible progress from AI, it's in working towards this goal. Difficult projects aren't in scope. But most tech, especially most tech branded IT, is not difficult. Everyone doesn't need an inventory or customer-complaint system designed from scratch. Current AI is good at cutting through that cruft.

gizajob 2y ago

Yeah I keep thinking this - how is Nvidia worth $3.5Trillion for making code autocomplete for coders

drawnwren 2y ago
Nvidia was not the best example. They get to moon in the case that any AI exponential hits. Most others have less of a wide probability distribution.
- BeefWellington 2y ago
  Yeah they're the shovel sellers of this particular goldrush. Most other businesses trying to actually use LLMs are the riskier ones, including OpenAI, IMO (though OpenAI is perhaps the least risky due to brand recognition).
  - lokimedes 2y ago
    Or they become the Webvan/pets.com of the bubble.
    - zeusk 2y ago
      Nvidia is more likely to become CSCO or INTC but as far as I can tell, that's still a few years off - unless ofcourse there is weakness in broader economy that accelerates the pressure on investors.
  - gizajob 2y ago
    I’d say it’s more about the fact that they make useful products rather than brand recognition.
- HarHarVeryFunny 2y ago
  I'm not sure about that. NVIDIA seems to stay in a dominant position as long as the race to AI remains intact, but the path to it seems unsure. They are selling a general purpose AI-accelerator that supports the unknown path. Once massively useful AI has been achieved, or it's been determined that LLMs are it, then it becomes a race to the bottom as GOOG/MSFT/AMZN/META/etc design/deploy more specialized accelerators to deliver this final form solution as cheaply as possible.

deleted 2y ago

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JumpCrisscross 2y ago

> level of investment and profit they are looking for can only be justified by creating AGI What are you basing this on? IT outsourcing is a $500+ billion industry. If OpenAI et al can run even a 10% margin, that business alone justifies their valuation.

HarHarVeryFunny 2y ago
It seems you are missing a lot of "ifs" in that hypothetical! Nobody knows how things like coding assistants or other AI applications will pan out. Maybe it'll be Oracle selling Meta-licenced solutions that gets the lion's share of the market. Maybe custom coding goes away for many business applications as off-the-shelf solutions get smarter. A future where all that AI (or some hypothetical AGI) changes is work being done by humans to the same work being done by machines seems way too linear.
- JumpCrisscross 2y ago
  > you are missing a lot of "ifs" in that hypothetical The big one being I'm not assuming AGI. Low-level coding tasks, the kind frequently outsourced, are within the realm of being competitive with offshoring with known methods. My point is we don't need to assume AGI for these valuations to make sense.
  - HarHarVeryFunny 2y ago
    Current AI coding assistants are best at writing functions or adding minor features to an existing code base. They are not agentic systems that can develop an entire solution from scratch given a specification, which in my experience is more typcical of the work that is being outsourced. AI is a tool, whose full-cycle productivity benefit seems questionable. It is not a replacement for a human.
    - JumpCrisscross 2y ago
      > they are not agentic systems that can develop an entire solution from scratch given a specification, which in my experience is more typcical of the work that is being outsourced If there is one domain where we're seeing tangible progress from AI, it's in working towards this goal. Difficult projects aren't in scope. But most tech, especially most tech branded IT, is not difficult. Everyone doesn't need an inventory or customer-complaint system designed from scratch. Current AI is good at cutting through that cruft.