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There’s a strong chance the IPO window has passed. I just don’t see investors willing to jump in here given all the questions about the financial viability of A
by cmiles8 7mo ago
There’s a strong chance the IPO window has passed. I just don’t see investors willing to jump in here given all the questions about the financial viability of AI.
The bulk of those investing now are broadly just pumping cash into the fire to keep their prior investments from going to zero.
We have hit a mass deceleration of what the current tech can do with transformers. The tech is also on a path to hyper-commoditization which will destroy the value of the big players as there zero moat to be had here. Absent a new major breakthrough it looks like we’re well on our way into the “trough of disillusionment” for the current AI hype cycle.
Will be interesting to see how all this plays out, but get your popcorn ready.
- newsclues 7mo agoUnless the play is the fleece retail investors
- thegreatpeter 7mo agoRetail investors do just fine fleecing themselves on their own The term fleecing means „there’s nothing left here, jump ship”. Do you really believe they’re going public to cash out this early in the game?
- cmiles8 7mo agoTrue, although even here there likely aren’t enough retail suckers to go around given the amount of initial investment folks need to cash in. Thats the challenge when you have so much crazy pre-IPO cash pumped in. After you float you still need to sell all those shares at the valuations you want to exit. If they floated say 10% of shares to go public and the price tanks everyone else trying to exit loses their shirt so it’s not a magic exit for the early investors.
- Ekaros 7mo agoThe size of these companies make be doubtful of retail being able to fund them. There being enough retail investors with enough liquid funds who are willing to jump on this. Lot of retail is in various funds. So those doing active management to scale of this is questionable. And then you most likely also have downward pressure for those that try to bet against these IPOs...
- FartyMcFarter 7mo agoThere's always the Softbanks of the world.
- doomslayer999 7mo ago[dead]
- newsclues 7mo agoBoomers are the perfect suckers at this point My boomer mom is the kind of person who just heard about AI and would get IPO fomo
- close04 7mo agoOlder people are always a good target for any scams. With age their mental acuity drops and they also have diminishing importance in society as sad as that sounds. They are not just easier but also safer targets for the scammers. Authorities don't bend over backwards to help when the victims are old people with no leverage left.
- DaedalusII 7mo agothere arent enough retail investors in the world to buy this ipo but they will get a lot of flow from sovereign wealth fund and pensions you might wonder why anthropic spend time in australia, a country with less economy than canada and almost no industry at all? likely because it has very big pension fund pool to buy their ipo
- bandrami 7mo agoThat would have worked better a month ago. The money is drying up. And the Gulf money is gone for the next 3 quarters in the best case.
- paganel 7mo agoJudging by what has happened last night with Qatar's LNG installations I'd say at leat the next 3 years. Unless the war were to stop right at this moment, but slim chances for that.
- chollida1 7mo ago> There’s a strong chance the IPO window has passed Ha, i'll take the other side of that bet. I'm not sure why you think they couldn't possibly IPO and you don't really specify why in your post. Having been in the capital markets for 20 years, now is one of the better times to IPO and I'd bet that both OpenAI and Anthropic will IPO within 12 months. There are lots of games you can play like releasing a small 10% float) if you are worried about not enough buyers.
- cik 7mo ago100% agreed. There's so much locked up appetite for IPOs, both from the tech crowd and the general public. There have been very few quality IPOs since COVID frankly. I'll wager that the IPO market can actually absorb all three of these that yes, are the size of the last 10 years combined. The trading market itself is larger, as are values, and valuations. I assume that to maximize value you see a standard lock and roll play here. The S-1 will declare the 10% release, with commentary about future (6 or 12 months) another 5%. Plus don't forget institutional. There's ample space here, even before the Nasdaq 100 changes that are probably coming into play. If those come into play then inflows accelerated, as did valuations.
- cgg23 7mo agoTHere's interest to hold it for diversification reasons but the reality is investors are not stupid. Look at the basket-case recent IPOs: Figma and Klarna. Many are skeptical of LLMs and how large of an impact they will have in the long-term. Nvidia's stock performance YTD is an example of that, despite the good news being pushed forward. People want to start seeing customers of OAI, Nvidia et al start generating incremental accounting profits from LLM-specific projects, let alone economic profits.
- financetechbro 7mo agoI was in the capital markets during the COVID era, focusing on transactions for tech companies. I will take the bet that if OAI tries to IPO it will be WeWork 2.0 x100. Get ready for an even more creative version of “Community adjusted EBITDA” On the real though, I am not sure how a 20yr veteran can say this is the best time for an IPO. Not only is a 10% float still absolutely massive, but the world is extremely unstable with the war in Iran and the US is in a recession when you factor out inflated growth driven by AI. Not to mention the Yen carry trade unwinding - there is so much loaded in the economy ready to blow up… I think the facade will collapse if OAI actually goes for it.
- 7thpower 7mo agoYou must be living on a different planet than me. Enterprises are just now seeing that these technologies can actually have an impact, and the companies do not have a discretionary cost cap the same way consumers/hobbyists do, so they will pay based on value.
- badgersnake 7mo agoI would expect a lot of smart money to flow out of the Nasdaq-100 trackers in anticipation of this grift.
- DaedalusII 7mo agonasdaq listings can be rough, not sure if anyone remember fb ipo but how else will they own spacex, openai, anthropic, nvidia, in such concentration
- pera 7mo agoThe Private Equity world already has a solution for this: Nasdaq's Shame https://news.ycombinator.com/item?id=47392550 https://news.ycombinator.com/item?id=47392550
- deleted 7mo ago[deleted]
- surgical_fire 7mo ago[flagged]
- CursedSilicon 7mo agoHey uh. Slurs aren't cool. You could've just as easily said "investors are morons" and had the same connotations without disparaging a group of people
- tartuffe78 7mo agoApparently morons once meant the same thing ARCHAIC•MEDICINE a person having low intelligence or an intellectual disability.
- surgical_fire 7mo agoI disagree, and I also don't care. I really despise this sort language policing, it is clear what my message was. The only group of people I disparaged are Tesla investors, deservingly so. Other types of mentally impaired people have my full sympathy, and that includes charity.
- CursedSilicon 7mo agoThe thing about using slurs is when you respond with "but [group] deserved it!" you've implied that you're happy to use it against someone if you subjectively believe they're "deserving" and that the term should be received negatively
- surgical_fire 7mo agoIncidentally, I don't refer to other types of mentally impaired people as "retard". The word has a negative connotation, similarly to "moron". Both terms obviously should be received negatively, they are insults. That's how insults work. I am happy to refer to more groups, not only Tesla investors, as retards too. I'll leave this as an exercise to imagination.
- aurareturn 7mo agoThere’s a strong chance the IPO window has passed. I just don’t see investors willing to jump in here given all the questions about the financial viability of AI. My guess, it has barely started. I think nearly all AI IPOs have done well so far.
- what 7mo agoWhat AI IPOs?
- hyperadvanced 7mo agoThere was one that went up and then back down. Coreweave.
- aurareturn 7mo agoCoreweave, Nebius, most Chinese AI IPOs have done extremely well.
- LZ_Khan 7mo agoDamn the narrative was just at "we are entering RSI" and this week all of a sudden it changed to "Transformers hit a wall AI winter is coming." Very suspicious.
- prasadjoglekar 7mo agoThe revenue is in the ads. If they hit a decent run rate prior to the IPO then there's a viable path to profitablity and justification for the insane capex.