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Didn’t we just witness it? Become a critical ecosystem player then get acquired based on the value of that position.
by andy99 3mo ago
Didn’t we just witness it? Become a critical ecosystem player then get acquired based on the value of that position.
- siliconpotato 3mo agoThis. They are buying a brick in the xkcd #2347 diagram
- Gigachad 3mo agoI’m asking more to work out what is the basis of this valuation. Why would Nvidia spend $13B for what seems to be a services that gives things away for free.
- weird-eye-issue 3mo agoThis is like saying GitHub or Google just gives away everything for free
- Gigachad 3mo agoNot really. GitHub has a strong platform of paying customers and a solid product that’s hard to replicate. Google is obvious. Hugging Face is a file download mirror with a couple of side features dangling off.
- weird-eye-issue 3mo agoWhether you realize it or not Hugging Face's monetization is just as obvious as GitHub's
- calebkaiser 3mo agoThey hit 150 million in annual recurring revenue this year. Pretty nice dangling side features apparently.
- Gigachad 3mo agoThat still leaves the company valued at 86 years of revenue
- calebkaiser 3mo agoYeah, great point. Nvidia could potentially be overpaying. Not sure how that equates to Huggingface being "a file download mirror with a couple of side features dangling off".
- weird-eye-issue 3mo agoJust wait until you hear that Facebook bought Instagram for $1 billion in 2012, when it was generating no revenue.
- Gigachad 3mo agoWhile it's probably easier to say this in retrospect, they were eliminating a direct competitor to their core business. Something so advantageous it should have been blocked by regulators. I can't see this as being as good of a purchase, especially when it's 13x the price of what was seen as an absurdly large amount back then.
- weird-eye-issue 3mo agoYou are very good at bringing up irrelevant numbers and missing the forest for the trees
- Gigachad 3mo agoYou are right, we are in a post numbers and reality economy.
- weird-eye-issue 3mo agoAre you 15x more sure of that than you were last year?
- deleted 3mo ago[deleted]
- jdejean 3mo agohttps://huggingface.co/pricing https://huggingface.co/pricing
- abrookewood 3mo agoI don't understand who this is targeted at. You can download the models, clone the datasets free. Who is paying them and why?
- aesthesia 3mo agoThis is like asking who is paying for GitHub if you can clone repositories and download code from it for free.
- abrookewood 3mo agoI guess that's a decent analogy, except the vast majority of people aren't building their own models.
- NortySpock 3mo agoRisk management. Nvidia has a market cap of $5T USD today, and a decent chunk of that is due to LLM speculation. Does Nvidia want their stock price to be at risk of being tanked by a download service being in the news? No, they want to make sure the party keeps going and is under their direct supervision, and part of that is making sure Hugging Face isn't bought by a competitor or runs out of money.
- DrewADesign 3mo agoTalking about profit is so passé in the new economic paradigm. The rules have changed— it’s about how much a company is worth. Get with the times. –Some guys in every bubble I’ve witnessed.
- lotsofpulp 3mo agoThis gets mentioned a lot, but the most valuable companies, by orders of magnitude, have the most profit, by orders of magnitude.
- DrewADesign 3mo agoYeah the people that say things like this aren’t looking for valuable companies, or to create value, or for sustainability — they’re looking for short-term growth.
- calebkaiser 3mo agoI dunno. You can argue over whether they're overpaying, but it's not like Huggingface is Clinkle. They hit $150 million in ARR this year, they have tons of runway, and according to reports, have just started to even burn the money they raised a few years ago. I get that it's fun to be glib about the stupidity of tech elites and investors in general, but Huggingface have been pretty open about their financials and are, in my opinion as a practitioner in the field, one of the most responsible orgs in our space. They've been a pillar of open source ML for years now and have made a very positive impact on our ecosystem. Nvidia is getting a real business generating revenue, and the center of the universe for open models. Both seem like pretty valuable attributes, from Nvidia's perspective.
- jameshart 3mo ago150 million a year? Why, at that rate NVidia will make their money back in just 86 years.
- calebkaiser 3mo ago
- zx8080 3mo ago> Why would Nvidia spend $13B for what seems to be a services that gives things away for free. To stop that! Literally. To stop those services being free.
- a34729t 3mo agofor 6 months?
- strictnein 3mo agoWhy would Nvidia destroy the first place we all look for models to load on our Nvidia hardware?
- ks2048 3mo agoThey make it easy to run models. The models have to run on hardware somewhere.
- polnoner 3mo agoThere is a brand and that brand is really a type of call option that is very hard to price. If you are doing the valuation using the tools of Ben Graham it is not really going to work. Damodaran's the Dark Side of Valuation is the text for this.
- strictnein 3mo agoPossibly, but they were profitable already.
- bliteben 3mo agoYou missed the part about get hacked by one of the cornerstones of the ecosystem so that you could get infinite bad press for them if you wanted.