etempleton

It isn’t just the Chinese models, though. Google Carbon just came out and from what I have heard is very competitive in direct comparisons and cheaper. Then there is Grok, Muse, etc. I feel fairly confident that there is not enough room for all of these to be successful businesses. Maybe enough room for two at the current valuations, but Google can just lurk in the background forever. Open AI and Anthropic don’t have that luxury. The minute they falter, for even a short period it is pretty much over.

No one with a brain does, but Anthropic’s valuation is banking on massive sustained growth to pay their bills.

I am being sardonic, but I honestly don’t see a path to profitability.

Zero percent chance they can grow fast enough to meet their financial obligations without taking on some extremely expensive debt that will increase and compound their losses.

At this point I think the goal is:

Step 1: Go public

Step 2: Allow exit for early investors

Step 3: file bankruptcy

Step 4: Amazon or Google “rescues” the company at pennies on the already heavily diluted valuation

God forbid kids have a fun holiday to get candy and dress up.

Shorting is always riskier because you have to time the trade. But I have moved exclusively to bonds.

No doubt, but a lot of investors believed the delusional weirdos and so have invested as if every human would be replaced by a sentient AI.

Yes, but it appears that the banks are not over levered like they were during the housing crisis. They will take a hit, but presumably will not need bailing out.

It was part of the bubble. Amazon's stock lost over 90% of it's value. The company survived, but many other companies did not. A bubble does not mean a company fails just that valuations are too high and that there will be a massive correction over a short period of time. Some companies fail, others survive.

Please do some research on the other costs involved in AI. Not a single AI company is making any profit and realistically are not close. Training models costs billions of dollars. There is no moat for these companies. If an open model comes out tomorrow that is better than Claude what happens to Claude's 1.5 trillion dollar valuation? What happens if revenue does not grow as fast as anticipated when Anthropic alone has 750 billion dollars in obligations? How do they pay their bills? What happens then.

The only company making money are hardware manufacturers who are throwing logs on to keep the fire burning through direct capital investments in their customers. Without Nvidia some of these neoclouds would already have failed.

It is preemptive. Everyone can see the bubble and these companies are barrelling forwarding anyway. It is reckless and irresponsible.

Fortunately, they do not owe the banks as much as they owe each other and private capital.

That is my point. A lot of the early dot com companies didn't survive. Just because AI has value does not mean there has not been over investment or investment in the wrong places.

There was a lot of value in the internet too but it didn’t prevent a crash.

Nvidia is willing to prop it up, I have no doubt about that, but that doesn’t matter if the market loses faith in the AI narrative. Core weave is a public company, investors can abandon the stock and have already started to do so. Anthropic and Open AI will probably also soon be public. If the market loses faith. It doesn’t matter. And Nvidia may eventually have to decide how much money they are willing to lose on Coreweave.

I know she fired and/or discredited a few people including an intern who's father was on the board of directors. Otherwise the compartmentalization did not allow everyone to see the full extent of the lie. Others were just too incentivized to go along with it.

Always good to pass on any opportunity you don’t fully understand. You may miss some opportunities, but you will also miss being taken as a fool.

VCs are typically kinda gullible because they are primed to believe and sometimes do not have the technical background to really do proper due diligences.

From what I know, extreme compartmentalization of information, to the extent it seriously harmed whatever chances there might have been to pivot to some kind of realistic product.

And then an extremely tight circle of people she knew she could manipulate. Liars hate people that see through their lies and get rid of them as soon as possible or otherwise try to ruin them.

Many rich people are really gullible to direct bold face lies because they are used to things working out for them and so are often less skeptical / guarded(generally speaking) if the lie sounds good.

I grew up with the mindset being told if things were too good to be true they probably were and to expect failure and be pleasantly surprised if things worked out. This is practical advice for many lower to middle class individuals, but it can also hold you back because you stop looking for genuine opportunities. Better advice would be to do your due diligence.

With Holmes, and hindsight is always 20/20, it should have been obvious that she was full of shit. As you say, I have met dozens of people, men and women, like her, that just lie reflexively and I have learned to spot them from a mile away and avoid them at all costs. If you catch someone lying or exaggerating something inconsequential, and by that, I mean it really does not in any way help them or get them out of trouble, it is easy to brush it off as a white lie, but it is the people who will lie for no reason at all who are the most dangerous because you can be assured that they will lie when they do have a reason.

This has been my argument for the past few weeks to explain why we aren’t seeing or feeling real world productivity gains as consumers despite many espousing the efficiency of AI they personally see with their own workflows. The hands on work is rarely the actual bottleneck.

My team can crank out high quality work in a few hours and AI could do the same medium to high quality work in a minute or two, but the review, feedback, and sign off takes days of back and forth. AI just slows this part of the process down because editing AI work is often a challenge because, no one is quite as familiar with how it was put together and sometimes it creates things that are not editable at all. And telling AI to make very specific changes is often a mixed bag at best.

Solo devs and small teams with minimal oversight can probably move a lot faster, but corporations are going to see minimal uplift except in areas where no one is looking.

Yeah, and the screen is just 7 inches to begin with. I just don’t know if I would get enough utility out of this device… I think it would be more interesting if it was a MagSafe dock for an iPad and that put the iPad into home hub mode or something.

Yeah, as long as there is a way to cast video to the device I think it works...some consumers may struggle with that as they are used to apps being on device, but it works for me.

The battery issue, I agree it is kind of a single room device, but I could see wanting to move it around the room I am in. If I am say, washing dishes versus cooking at the stove, versus doing prep work. Right now I move an iPad around with me in the kitchen. Also, for when there is a facetime call being able to best position it for what I am currently doing verus having to move to the device and face it.

Yeah, I assume, but they haven’t shown that at all. I would be fine with a standard AirPlay video implementation.

I think it is a neat product with two strange limitations that I can't quite figure out:

1. No apps. This would be perfect for my kitchen but I like to watch videos, movies, tv shows while I cook. The aspect ratio is not ideal, but the fact it won't support third party apps means that is not an option. Maybe it will support Airplay video and I can cast from my phone?

2. No battery means it is stuck to the wall. They had to work around this limitation in their own (excellent) promo video by drilling a hole in the middle of their kitchen island. The device would have a lot more utility if it could be moved around a lot and then say in a base station like a Sonos Move.

They would also stop selling equity to private investors. They are likely diluting their own stake.

But they need the money. After all that has already been invested they still need more. That is all I need to know about any delusions that they are currently profitable.

I am not even sure that is true. We don’t know everything that is included or excluded from their calculation. I suspect there is a lot of funny math going on to get to profitability. Remember there was a lot of similar talks and reports about SpaceX and how profitable they were. The reality was much worse. I just don’t believe it until I see it in the S1. Even then they can hide quite a bit.

Have we considered that many of them are rather dumb.

The biggest bottleneck in most organizations is not the production of said work, but the bureaucracy surrounding it. AI isn’t going to solve that. So it really doesn’t matter if AI makes programmers 20, 30, 40 percent faster, they will still be facing the same bottleneck at the end.

Would they charge me less if I was poor? If they comped a family of fours meals because they were below the poverty line I would argue it was almost progressive, but they are only doing this to extract more money from people who they think might not be as price sensitive.