8 ms·

So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops? IPOing and getting a bunch of cash, even if your stock s

by rconti 5mo ago

So they're not just racing to gain dominance in AI, they're also racing to IPO before the music stops? IPOing and getting a bunch of cash, even if your stock subsequently suffers in the crash, is a lot better than being unable to get that capital infusion before the house of cards collapses.

Avicebron 5mo ago
Better for whom?
- SecretDreams 5mo ago
  The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO. Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.
  - JumpCrisscross 5mo ago
    > The company. Worse for the investors It's worse for the new investors. (If it crashes.) It's great for the old investors. They got an opportunity to sell if they wanted. If they didn't, they still own their shares, except in a company that has that IPO cash sitting in its account.
    - SecretDreams 5mo ago
      Yes, correct. Although, even for some company folks, if it crashes, they get burned since they typically have blackouts post IPO. Of course, some special souls are excluded from blackouts lol.
      - JumpCrisscross 5mo ago
        > if it crashes, they get burned since they typically have blackouts post IPO In the alternate timeline they would have held shares in a private company. They're still not really getting burned other than getting a tax bill.
bickfordb 5mo ago
The only reason I can think of for the accelerated S&P 500 inclusion of SpaceX is a pump and dump
- JumpCrisscross 5mo ago
  > the accelerated S&P 500 inclusion of SpaceX To be clear, S&P hasn't announced a decision on this yet.
  - jackyinger 5mo ago
    Perhaps they’re afraid announcement would trigger divestment
    - JumpCrisscross 5mo ago
      > Perhaps they’re afraid announcement would trigger divestment S&P don't get a choice around whether they announce their methodology or not. That said, the rule change at the NASDAQ 100 doesn't seem to have impacted pricing or allocation. I can't imagine that many people are that concerned about this. (I posted the public-comment request from S&P to HN [1]. The response was crickets.) [1] https://news.ycombinator.com/item?id=48054324 https://news.ycombinator.com/item?id=48054324
      - rconti 5mo ago
        Just yesterday I asked my advisor about exposure to these IPOs. I don't mind having a small bit of exposure to them, I just don't want the outsized share they seem to be trying to take for everyone.
    - LostMyLogin 5mo ago
      I imagine the vast majority don’t care. All they care about is trying to hit their 401k or Roth IRA contributions for the month.
    - willis936 5mo ago
      I can assure you they are already seeing divestment in preparation.
paulpauper 5mo ago
People keep predicting "house of cards" and keep being wrong. AI bubble was supposed to burst as far back as 2023. When was the last time since 2009 there was a $500+ billion tech valuation that lost 90% or more? After a certain point , 100% market penetration is achieved and these products become mainstream and profitability follows. See Uber and Tesla for examples.
- hungryhobbit 5mo ago
  Read history: people always think everything is fine ... until it isn't.
  - JumpCrisscross 5mo ago
    > people always think everything is fine ... until it isn't History is also replete with people constantly predicting collapses that don't come. Timing the market is very hard with numbers, it's total nonsense if one is just going off vibes.
    - za_creature 5mo ago
      Most bank runs tend to be driven by vibes, not numbers though. The good news is that these folks seem to be in possession of a vibe-rator.
      - JumpCrisscross 5mo ago
        > bank runs Anthropic, SpaceX and OpenAI are not banks. (Also, we had the largest bank runs in American history three years ago. The ordinary American barely noticed.)
        za_creature 5mo ago
        They're not profitable either, so the money has to come from somewhere, no?
aurareturn 5mo ago
I don't think OpenAI or Anthropic are predicting that the AI market is going to collapse. In fact, I think both are bullish that the public still isn't pricing in exponential growth. I think what is happening is that OpenAI is racing to IPO before Anthropic because their growth isn't as impressive. If you are the weaker company, you should IPO first to lock up the cash.
- Avicebron 5mo ago
  What are they offering the public (not me and you writing code in our free time)?
  - aurareturn 5mo ago
    They are offering the public an opportunity to become shareholders and they are giving their investors and employees liquidity.
    - Avicebron 5mo ago
      I mean as a long-term product, not as a offer to join a hype cycle.
      - aurareturn 5mo ago
        Automating a large portion of existing white collar work, accelerating scientific discoveries, brain for robotics, etc. These are compelling offers.
        Avicebron 5mo ago
        Sure, how does that benefit the public?
        aurareturn 5mo ago
        I don't know. Some will benefit, some will not. The topic here is the IPOs.
dangus 5mo ago
I'm not sure how long we can continue being negative about these AI companies. This idea that there will be a crash has often burned the bears in a way that has become an Internet meme. In reality, corporations as a whole are seeing record profits continuing through 2026. Whether or not the average person is doing well is pretty irrelevant to the stock market: if companies are increasingly profitable, stocks go up. Everything I hear about Anthropic points to a company that is actually closer to profitability and possibly already profitable, unlike many of its other peers. We don't really look at YouTube as a failure and that product was unprofitable for many years. Nobody thinks the Uber bubble is going to burst even though it has never made back its investment money. I think OpenAI is undisciplined and poorly run hence the insane burning of cash. Sam Altman is a terrible CEO and a conman. Anthropic is run by legit people. Companies like Google, Microsoft, and Meta face essentially no negative consequence for burning cash. They have no urgent need to be efficient about their AI investments, even if they could be. SpaceX is of course not profitable and has a lot of baggage but they still have a major asset, which is that Starlink prints utility company levels of money and is expanding both customer base and profit margins rapidly. Are they overvalued? Yeah, of course.

by rconti 5mo ago

Avicebron 5mo ago

Better for whom?

SecretDreams 5mo ago
The company. Worse for the investors. It's a classic bagholder play, but it can give the companies a comfortable runway post IPO. Typically, you IPO when your private funding is drying up and/or some of your early lenders want to cash out.
- JumpCrisscross 5mo ago
  > The company. Worse for the investors It's worse for the new investors. (If it crashes.) It's great for the old investors. They got an opportunity to sell if they wanted. If they didn't, they still own their shares, except in a company that has that IPO cash sitting in its account.
  - SecretDreams 5mo ago
    Yes, correct. Although, even for some company folks, if it crashes, they get burned since they typically have blackouts post IPO. Of course, some special souls are excluded from blackouts lol.
    - JumpCrisscross 5mo ago
      > if it crashes, they get burned since they typically have blackouts post IPO In the alternate timeline they would have held shares in a private company. They're still not really getting burned other than getting a tax bill.

bickfordb 5mo ago

The only reason I can think of for the accelerated S&P 500 inclusion of SpaceX is a pump and dump

JumpCrisscross 5mo ago
> the accelerated S&P 500 inclusion of SpaceX To be clear, S&P hasn't announced a decision on this yet.
- jackyinger 5mo ago
  Perhaps they’re afraid announcement would trigger divestment
  - JumpCrisscross 5mo ago
    > Perhaps they’re afraid announcement would trigger divestment S&P don't get a choice around whether they announce their methodology or not. That said, the rule change at the NASDAQ 100 doesn't seem to have impacted pricing or allocation. I can't imagine that many people are that concerned about this. (I posted the public-comment request from S&P to HN [1]. The response was crickets.) [1] https://news.ycombinator.com/item?id=48054324 https://news.ycombinator.com/item?id=48054324
    - rconti 5mo ago
      Just yesterday I asked my advisor about exposure to these IPOs. I don't mind having a small bit of exposure to them, I just don't want the outsized share they seem to be trying to take for everyone.
  - LostMyLogin 5mo ago
    I imagine the vast majority don’t care. All they care about is trying to hit their 401k or Roth IRA contributions for the month.
  - willis936 5mo ago
    I can assure you they are already seeing divestment in preparation.

paulpauper 5mo ago

People keep predicting "house of cards" and keep being wrong. AI bubble was supposed to burst as far back as 2023. When was the last time since 2009 there was a $500+ billion tech valuation that lost 90% or more? After a certain point , 100% market penetration is achieved and these products become mainstream and profitability follows. See Uber and Tesla for examples.

hungryhobbit 5mo ago
Read history: people always think everything is fine ... until it isn't.
- JumpCrisscross 5mo ago
  > people always think everything is fine ... until it isn't History is also replete with people constantly predicting collapses that don't come. Timing the market is very hard with numbers, it's total nonsense if one is just going off vibes.
  - za_creature 5mo ago
    Most bank runs tend to be driven by vibes, not numbers though. The good news is that these folks seem to be in possession of a vibe-rator.
    - JumpCrisscross 5mo ago
      > bank runs Anthropic, SpaceX and OpenAI are not banks. (Also, we had the largest bank runs in American history three years ago. The ordinary American barely noticed.)
      - za_creature 5mo ago
        They're not profitable either, so the money has to come from somewhere, no?

aurareturn 5mo ago

I don't think OpenAI or Anthropic are predicting that the AI market is going to collapse. In fact, I think both are bullish that the public still isn't pricing in exponential growth. I think what is happening is that OpenAI is racing to IPO before Anthropic because their growth isn't as impressive. If you are the weaker company, you should IPO first to lock up the cash.

Avicebron 5mo ago
What are they offering the public (not me and you writing code in our free time)?
- aurareturn 5mo ago
  They are offering the public an opportunity to become shareholders and they are giving their investors and employees liquidity.
  - Avicebron 5mo ago
    I mean as a long-term product, not as a offer to join a hype cycle.
    - aurareturn 5mo ago
      Automating a large portion of existing white collar work, accelerating scientific discoveries, brain for robotics, etc. These are compelling offers.
      - Avicebron 5mo ago
        Sure, how does that benefit the public?
        aurareturn 5mo ago
        I don't know. Some will benefit, some will not. The topic here is the IPOs.

dangus 5mo ago

I'm not sure how long we can continue being negative about these AI companies. This idea that there will be a crash has often burned the bears in a way that has become an Internet meme. In reality, corporations as a whole are seeing record profits continuing through 2026. Whether or not the average person is doing well is pretty irrelevant to the stock market: if companies are increasingly profitable, stocks go up. Everything I hear about Anthropic points to a company that is actually closer to profitability and possibly already profitable, unlike many of its other peers. We don't really look at YouTube as a failure and that product was unprofitable for many years. Nobody thinks the Uber bubble is going to burst even though it has never made back its investment money. I think OpenAI is undisciplined and poorly run hence the insane burning of cash. Sam Altman is a terrible CEO and a conman. Anthropic is run by legit people. Companies like Google, Microsoft, and Meta face essentially no negative consequence for burning cash. They have no urgent need to be efficient about their AI investments, even if they could be. SpaceX is of course not profitable and has a lot of baggage but they still have a major asset, which is that Starlink prints utility company levels of money and is expanding both customer base and profit margins rapidly. Are they overvalued? Yeah, of course.