6 ms·

How can a middle man for api calls be worth so much? Their market share can’t be very large right? For comparison, $7B is more than market cap of Lyft, Dolby, a

How can a middle man for api calls be worth so much? Their market share can’t be very large right? For comparison, $7B is more than market cap of Lyft, Dolby, and Alaska Airlines. What is happening? https://stockanalysis.com/list/mid-cap-stocks/ https://stockanalysis.com/list/mid-cap-stocks/

blitzar 2mo ago
If any of those companies put Ai into their pitch they too would be worth billions
- andrewinardeer 2mo ago
  I landscape gardens... With AI. Pay me.
  - chistev 2mo ago
    https://news.ycombinator.com/item?id=46444508 https://news.ycombinator.com/item?id=46444508
- throw-the-towel 2mo ago
  You've already seen Long Island Blockchain, now get ready for... Alaska AI Lines!
codybontecou 2mo ago
LLM traces are supposedly very valuable. I imagine OpenRouter has one of the most extensive and diverse set of traces in the world.
- ruined 2mo ago
  openrouter prompt and i/o logging is off by default https://openrouter.ai/docs/guides/privacy/data-collection https://openrouter.ai/docs/guides/privacy/data-collection the providers you route to will of course have their own policies, which openrouter surfaces to you through the webui and api. you can even configure automatic routing to select providers based on your policy preferences.
  - codybontecou 2mo ago
    Oh that's very interesting. Thanks for the link.
- putlake 2mo ago
  If your data is leaking to OpenRouter, how many companies would be OK with that? So I doubt OpenRouter are peeking inside the workloads that flow through their proxy. However, they do publish "Top Models by Task" ranking[1] so maybe you have a point. [1] https://openrouter.ai/rankings#task-spend https://openrouter.ai/rankings#task-spend
  - kzrdude 2mo ago
    If they don’t loudly promise to not scan or store requests they handle then I believe they already do it, or will.
  - dghlsakjg 2mo ago
    The top models by task is self reported. It’s based on the referrer header or some custom one I forget at this moment. If you don’t include that it just doesn’t count those tokens.
  - ljlolel 2mo ago
    when you use a closed source router you don’t know what it’s doing. that's why my site TrustedRouter is hosted and end to end encrypted and you can actually see what it’s doing.
  - otabdeveloper4 2mo ago
    > how many companies would be OK with that? That ship sailed long ago when you sold your soul to Claude.
  - Bolwin 2mo ago
    It's an opt in feature in openrouter to get a 1% discount.
minimaxir 2mo ago
I'd suspect it's related to the rise of good/cheap Chinese models, and OpenRouter is the best way to use them without jumping through a ton of hoops.
- maxdo 2mo ago
  Exactly , not even small startup anywhere in us , eu or nearby will be ok to send data to China, but with open router you can create a no China provider selector with one llm call and start using Chinese llms without paying to vendors a single cent . What’s the angle for stripe , electrify over tokens exchange is the new money flow , and stripe wants to monetize it. 5% tax on any llm token is an amazing deal
  - nubg 2mo ago
    > but with open router you can create a no China provider selector why on earth would you trust no data is sent to China? just because you clicked a toggle?
    - lxgr 2mo ago
      By that logic, how can you trust OpenAI and Anthropic not to do the same?
      - gruez 2mo ago
        For one, openai and anthropic are the top two AI labs and therefore have some reputation at stake. Openrouter is like aliexpress. Any fly-by night vendor can get listed on there.
        nozzlegear 2mo ago
        The Chinese providers also have reputations at stake
        SoftTalker 2mo ago
throwaway473825 2mo ago
Cursor got bought for $60B. This is simply how AI companies are valued.
Taikhoom10 2mo ago
[flagged]
- janalsncm 2mo ago
  Dude I looked at your post history and every single comment is linking to your blog.
  - MagicMoonlight 2mo ago
    [dead]
Aurornis 2mo ago
It's an inflated number due to the AI market, but their selling point is distribution. Many people and businesses want to experiment with different models, but they don't want to sign up for a dozen different services. Businesses can make it difficult to approve new vendors. If your company is looking at 5 different vendors for tokens and teams can't agree to switch together, OpenRouter comes along with a unified interface and a single billing point. They also become the point to add value-add services on top in a portable way. They already offer some things like automatic JSON repair, but I can see them adding functionality like leak detection tools, monitoring, alerts, and other patterns that a company can set up once and use with all of the models theirs teams need. What I'm not so sure about is their moat. They have the brand recognition, but it seems rather easy for someone else to build what they've built. I'm a little confused about why Stripe didn't just build the same thing internally. Acquiring this company gives them an instant boost of 10 million customers for their AI business, which might be key to some financial goal they've got.
- gruez 2mo ago
  >It's an inflated number due to the AI market, but their selling point is distribution. >Many people and businesses want to experiment with different models, but they don't want to sign up for a dozen different services. Businesses can make it difficult to approve new vendors. If your company is looking at 5 different vendors for tokens and teams can't agree to switch together, OpenRouter comes along with a unified interface and a single billing point. Isn't that ripe for being picked off by aws or azure? Both already have marketplaces where vendors can offer whatever cloud services they want. Both already offer first party inference service, and have contracts with all the stodgy corps where it's "difficult to approve new vendors". Not to mention they have IAM and SSO built in. Good luck bolting that onto a third party vendor like openrouter.
  - altcognito 2mo ago
    I can actually restrict how much is spent using a sensible user interface with openrouter. That’s a real pain with aws
claw-el 2mo ago
When there is a bidding war for a company, I don’t think fundamentals matter as much anymore..
kelnos 2mo ago
You can't really compare market caps like that. Addressable market or market share is only one piece of the puzzle, and the other companies you mention are in very different kinds of markets, with very different kinds of products, with very different kinds of costs and margins. A valuation just reflects what someone thinks about the future cash flows of the business. But yeah, it does feel a bit crazy; unsurprisingly, AI hype affects valuations of AI companies too. On the other hand, I can see the idea that some people might be betting on the idea that the big US labs are bloated and spend too much money, and that the real money is going to be in serving open-weight models, and/or in automatically combining and routing to different models based on the task at hand.
Taikhoom10 2mo ago
[dead]
lotsofpulp 2mo ago
The market cap of any business operating in the physical realm has to account for enormous liability, especially for one like an airline. Also, their operating costs are huge with much less ability to scale, resulting in much lower potential increase in margins.
ilaksh 2mo ago
Their market share is as big as it gets for that type of AI business.
missedthecue 2mo ago
A good year for Alaska Airlines is 5% sales growth. OpenRouter is growing that much per week I'm guessing.
arjie 2mo ago
I prefer using OpenRouter because the money I pay them in premium is far less than the money I lose by not using it on other providers. On OpenRouter, I can switch dollars between models. But for the providers, after evaluating I'm stuck with some number of credits on ones I don't use. This kind of intermediation is actually super useful to me. I must imagine that they can also provide other things that are of value like provider quality measures, ability to swap providers during downtime, etc.
jonas21 2mo ago
You could just as easily ask yourself how can a middle man for people finding web pages be worth so much, but here we are, and Google is worth something like $4 trillion, mostly on the back of search. As it turns out, it's very valuable to be the intermediary between a large number of people who want something and a commoditized market of providers. It's the middleman who captures most of the margin. Now, AI models are not a commodity yet. But things seem like they might be heading that direction. And in a world where they are, Stripe probably wants to be that guy sitting in the middle.
thedreammachine 2mo ago
Optionality. This positions Stripe well to compete in AI compute, model development, apps... This is not a simple 1+1=2 merger.
wrsh07 2mo ago
It's pretty valuable to own the customer touch point Also when people ask questions like this it usually means they're asking questions about a point in time, eg given today's numbers But valuation should account for trajectory (where will they be in five years?) In the hypothesized bull case for ai, they benefit dramatically from the secular tailwinds (ie unrelated to their own business strategy) of AI So one way to consider this is it's a hedge by stripe in case AI becomes as big as some people think it is. And 7b to get in on the ai wave is a good deal in that case. And in all the other cases, it goes to zero and stripe is fine

blitzar 2mo ago

If any of those companies put Ai into their pitch they too would be worth billions

andrewinardeer 2mo ago
I landscape gardens... With AI. Pay me.
- chistev 2mo ago
  https://news.ycombinator.com/item?id=46444508 https://news.ycombinator.com/item?id=46444508
throw-the-towel 2mo ago
You've already seen Long Island Blockchain, now get ready for... Alaska AI Lines!

codybontecou 2mo ago

LLM traces are supposedly very valuable. I imagine OpenRouter has one of the most extensive and diverse set of traces in the world.

ruined 2mo ago
openrouter prompt and i/o logging is off by default https://openrouter.ai/docs/guides/privacy/data-collection https://openrouter.ai/docs/guides/privacy/data-collection the providers you route to will of course have their own policies, which openrouter surfaces to you through the webui and api. you can even configure automatic routing to select providers based on your policy preferences.
- codybontecou 2mo ago
  Oh that's very interesting. Thanks for the link.
putlake 2mo ago
If your data is leaking to OpenRouter, how many companies would be OK with that? So I doubt OpenRouter are peeking inside the workloads that flow through their proxy. However, they do publish "Top Models by Task" ranking[1] so maybe you have a point. [1] https://openrouter.ai/rankings#task-spend https://openrouter.ai/rankings#task-spend
- kzrdude 2mo ago
  If they don’t loudly promise to not scan or store requests they handle then I believe they already do it, or will.
- dghlsakjg 2mo ago
  The top models by task is self reported. It’s based on the referrer header or some custom one I forget at this moment. If you don’t include that it just doesn’t count those tokens.
- ljlolel 2mo ago
  when you use a closed source router you don’t know what it’s doing. that's why my site TrustedRouter is hosted and end to end encrypted and you can actually see what it’s doing.
- otabdeveloper4 2mo ago
  > how many companies would be OK with that? That ship sailed long ago when you sold your soul to Claude.
- Bolwin 2mo ago
  It's an opt in feature in openrouter to get a 1% discount.

minimaxir 2mo ago

I'd suspect it's related to the rise of good/cheap Chinese models, and OpenRouter is the best way to use them without jumping through a ton of hoops.

maxdo 2mo ago
Exactly , not even small startup anywhere in us , eu or nearby will be ok to send data to China, but with open router you can create a no China provider selector with one llm call and start using Chinese llms without paying to vendors a single cent . What’s the angle for stripe , electrify over tokens exchange is the new money flow , and stripe wants to monetize it. 5% tax on any llm token is an amazing deal
- nubg 2mo ago
  > but with open router you can create a no China provider selector why on earth would you trust no data is sent to China? just because you clicked a toggle?
  - lxgr 2mo ago
    By that logic, how can you trust OpenAI and Anthropic not to do the same?
    - gruez 2mo ago
      For one, openai and anthropic are the top two AI labs and therefore have some reputation at stake. Openrouter is like aliexpress. Any fly-by night vendor can get listed on there.
      - nozzlegear 2mo ago
        The Chinese providers also have reputations at stake
        SoftTalker 2mo ago

throwaway473825 2mo ago

Cursor got bought for $60B. This is simply how AI companies are valued.

Taikhoom10 2mo ago

[flagged]

janalsncm 2mo ago
Dude I looked at your post history and every single comment is linking to your blog.
- MagicMoonlight 2mo ago
  [dead]

Aurornis 2mo ago

It's an inflated number due to the AI market, but their selling point is distribution. Many people and businesses want to experiment with different models, but they don't want to sign up for a dozen different services. Businesses can make it difficult to approve new vendors. If your company is looking at 5 different vendors for tokens and teams can't agree to switch together, OpenRouter comes along with a unified interface and a single billing point. They also become the point to add value-add services on top in a portable way. They already offer some things like automatic JSON repair, but I can see them adding functionality like leak detection tools, monitoring, alerts, and other patterns that a company can set up once and use with all of the models theirs teams need. What I'm not so sure about is their moat. They have the brand recognition, but it seems rather easy for someone else to build what they've built. I'm a little confused about why Stripe didn't just build the same thing internally. Acquiring this company gives them an instant boost of 10 million customers for their AI business, which might be key to some financial goal they've got.

gruez 2mo ago
>It's an inflated number due to the AI market, but their selling point is distribution. >Many people and businesses want to experiment with different models, but they don't want to sign up for a dozen different services. Businesses can make it difficult to approve new vendors. If your company is looking at 5 different vendors for tokens and teams can't agree to switch together, OpenRouter comes along with a unified interface and a single billing point. Isn't that ripe for being picked off by aws or azure? Both already have marketplaces where vendors can offer whatever cloud services they want. Both already offer first party inference service, and have contracts with all the stodgy corps where it's "difficult to approve new vendors". Not to mention they have IAM and SSO built in. Good luck bolting that onto a third party vendor like openrouter.
- altcognito 2mo ago
  I can actually restrict how much is spent using a sensible user interface with openrouter. That’s a real pain with aws

claw-el 2mo ago

When there is a bidding war for a company, I don’t think fundamentals matter as much anymore..

kelnos 2mo ago

You can't really compare market caps like that. Addressable market or market share is only one piece of the puzzle, and the other companies you mention are in very different kinds of markets, with very different kinds of products, with very different kinds of costs and margins. A valuation just reflects what someone thinks about the future cash flows of the business. But yeah, it does feel a bit crazy; unsurprisingly, AI hype affects valuations of AI companies too. On the other hand, I can see the idea that some people might be betting on the idea that the big US labs are bloated and spend too much money, and that the real money is going to be in serving open-weight models, and/or in automatically combining and routing to different models based on the task at hand.

Taikhoom10 2mo ago

[dead]

lotsofpulp 2mo ago

The market cap of any business operating in the physical realm has to account for enormous liability, especially for one like an airline. Also, their operating costs are huge with much less ability to scale, resulting in much lower potential increase in margins.

ilaksh 2mo ago

Their market share is as big as it gets for that type of AI business.

missedthecue 2mo ago

A good year for Alaska Airlines is 5% sales growth. OpenRouter is growing that much per week I'm guessing.

arjie 2mo ago

I prefer using OpenRouter because the money I pay them in premium is far less than the money I lose by not using it on other providers. On OpenRouter, I can switch dollars between models. But for the providers, after evaluating I'm stuck with some number of credits on ones I don't use. This kind of intermediation is actually super useful to me. I must imagine that they can also provide other things that are of value like provider quality measures, ability to swap providers during downtime, etc.

jonas21 2mo ago

You could just as easily ask yourself how can a middle man for people finding web pages be worth so much, but here we are, and Google is worth something like $4 trillion, mostly on the back of search. As it turns out, it's very valuable to be the intermediary between a large number of people who want something and a commoditized market of providers. It's the middleman who captures most of the margin. Now, AI models are not a commodity yet. But things seem like they might be heading that direction. And in a world where they are, Stripe probably wants to be that guy sitting in the middle.

thedreammachine 2mo ago

Optionality. This positions Stripe well to compete in AI compute, model development, apps... This is not a simple 1+1=2 merger.

wrsh07 2mo ago

It's pretty valuable to own the customer touch point Also when people ask questions like this it usually means they're asking questions about a point in time, eg given today's numbers But valuation should account for trajectory (where will they be in five years?) In the hypothesized bull case for ai, they benefit dramatically from the secular tailwinds (ie unrelated to their own business strategy) of AI So one way to consider this is it's a hedge by stripe in case AI becomes as big as some people think it is. And 7b to get in on the ai wave is a good deal in that case. And in all the other cases, it goes to zero and stripe is fine