VC

Available_Road_2538

Alexa, secure the VC funding

Bardy_Bard

They still have YouTube (that’s owning Netflix), Waymo that’s owning Tesla in self driving cars. Also made a hefty profit on space X and Anthropic once ipo hits ( they are a very strong VC baked into public company), TPUs sell like hot cakes and cloud growth is crazy. TBH even if search is dead they are doing the right moves so that GOOG can prosper.

bigbugzman

That will come when VC takes enough of a loss on Neoclouds and no one can pay the non cancellable GPU orders with NVIDIA.

Barbecue-Ribs

The guy might be the most successful 1 man VC fund in history.

Syllabub_Visual

The fact that the anthropic founders can each sell 10% of their shares on ipo day feels unimaginably wildly fucked up. This absolutely feels like some giant scam. They along with the VC’s are just gonna dump everything onto retail and YOU will be left holding the bag. Wonder if anyone will go to prison over this.

Syllabub_Visual

Are the founders of Anthropic so STUPID and self absorbed that they even want to ipo? Why are the banks so stupid to underwrite this as well? On the other hand could see a quick pump in the first few days and all the VC’s and founders and banks will dump (the structure is so scandalous that the founders can dump 10% on day 1) THEN it will crash 95%.

outhinking

It's gambling unless you're trading with a 1-2 years horizon at least just like VC funds

cockNballs222

Whoever is paying for their cloud/ai offerings is paying them real money to do so (at an accelerated pace, 100% growth). Tough to know who and what those customers, I’m sure a big chunk is VC money throwing shit at the wall, hoping one of them is the next whatever…

ComplexEntertainer13

> They're also too concentrated in their customer revenue We might also add. That a large chunk of their revenue comes from AI startups, which in turn are relying on VC funding.

Syllabub_Visual

It’s estimated that the Somalis in Minnesota have committed AT LEAST $18 BILLION worth of fraud (the real number is likely far higher). Of the roughly 80,000 there, that means that each one has gotten on average $222k of taxpayer dollars paid for by hardworking AMERICANS. That’s nearly half what the average person pays in a lifetime and you’re telling me that these criminals are just gonna steal your grandmother’s life work and do god knows what with it. Oh and the trackers said that last year alone $3 BILLION was transmitted from Minnesota to Somalia, so of course they’re stealing your hard earned money and sending it to god knows who. I’m hardly the only one who believes this. Jd and Elon and Nick Shirley all agree with me, as do the VC’s and hot chicks in Miami. It’s radicals like Tim walz (who’s received god knows how much in kickbacks from the fraud) that love to hide from reality. Why is it relevant here? Because it’s a huge amount of money flowing around and someone somewhere is gonna move markets with it even though they certainly shouldn’t be.

Syllabub_Visual

Looks like Mohamed is gonna win Michigan. The radical leftists and their Jew hating rallies on college campuses have won again. I’m just gonna say that if mango, musk, Nick Shirley, VC’s, and hot girls in Miami ALL agree on something then nobody serious will disagree. Gonna be buying a lot of puts because the dsa being in charge is gonna be a total disaster and wreck the economy.

GreyHairedDWGuy

I remember driving in Orange County and seeing a large warehouse that had been converted to a head office of some .com. I actual had a call nearby so I stopped in and looked. There was a jumbotron screen the size you would see in a 70,000 seat stadium, hanging on the main lobby foyer. All paid for by VC money. .com bubble bursts and that company went bye bye fast.

Syllabub_Visual

I’m in Miami and I guess bolsonaro will be joining us here. Literally proves my point that this is the city EVERYONE wants to come to. We have ig models, VC’s, tech bros, fitness influencers, and now former disgraced Brazilian senators. If you’re not here you’re missing out. I wish you could buy options on cities, but I’m still buying up a bunch of real estate here because it’s gonna start to look super cheap and property values will multiply for the exact reasons I described.

Syllabub_Visual

Tell me why all the hot chicks and VC’s in Miami are MAGA? Being MAGA will get you into pretty hot social circles there. Look I don’t even like mango on principle but I’m not gonna pretend that I won’t play a game that will allow me to advance in society. Now who do the libs have other than their blue haired fat activists in Oakland? And it’s very relevant to this sub because we all want money and the people who control the keys to the kingdom are all MAGA too. The big tech CEOs and financiers tried to pretend to be libs for a long time until they could no longer hide it and what do they control, MONEY.

Syllabub_Visual

Tell me why Somalia is such a shithole country today. Mango and Nick Shirley say the same thing and half the country (though probably more like 90%) would agree with me. You know I hate MAGA, but in real life I’ve adopted a right wing personality and I’ve gotten a lot of admiration from hot chicks in Miami and have been invited into many vc and influencer circles because of it (even though I’m still single). They agree with everything I have to say about Somalis in Minnesota and they’re actually HOT and the people who hold actual power in the world will do anything for your prez who believes the same exact things (he built an entire movement on it). It’s not about racism, but instead one community which has disproportionately high fraud rates compared to everyone else. And if hot girls and VC’s in Miami agree with me, what do I have to complain about?

CTQ99

The issue with the dotcom bubble was the internet still wasnt widely used for commerce at the time and you had websites popping up to try to sell every type of product and be granted insane valuations. Go to urinalcake.com the only online marketplace for all your piss patties. BRILLIANT, HERES A VALUATION MORE THAN 90% ITHER COMPANIES CAUSE ONLINE! That was the insanity that was then, its akin to the AI startups that specialize in some niche thing that no one cares about and just slaps AI in their name, but most of those things are still privately owned and siphoning VC money still.

GreyHairedDWGuy

Anthropic and OpenAI are burning through cash much faster than revenues are coming in. If AI becomes a cheap commodity, then they are screwed because of burn rate unless they evolve to a method of training that is far more efficient than it is today. The dotcom bubble was based on greed. I worked in Silicon valley back then and saw the carnage first hand. VC's would fund anything with '.com' in the name and there were some stupid ideas that got millions in VC $ and it was all gone in a year or so. The economics don't make sense they way things are going.

GreyHairedDWGuy

I hope you're right. But this seems very similar to 2000. If Anthropic or OpenAI have a big public hack due to their AI, your investments will take a hit. As a VC backed company, only VC's feel the pain (excluding the hack itself). But once this becomes publicly traded, it has the potential to ruin a lot of peoples financial security.

Syllabub_Visual

So this month alone in Miami people there have ATTEMPTED to scam me out of 900k. The actual amount they’ve been successful in taking is still $0, but tells you something about that city. Oh well there are a bunch of hot chicks and tech bros and rich Russian guys here so it’s not like I can really complain about anything. Tell me why else ig models and VC’s and software engineers and Russian oligarchs all hang out in the same city.

fallingdowndizzyvr

> There were plenty of customers for network capacity Not even close to enough to saturate what was built out. That's what caused the bubble. Not no customers at all. Just not enough. > The customers for AI physical infrastructure are AI sellers who are running on debt and VC capital as well. A big difference is PE. Valuations were very stretched. Cisco's PE was 150 during dot bomb. Nvidia's PE is 27. Cisco was a bubble. Nvidia is not. > It’s the money in the AI end user demand which isn’t there yet to justify multiples. They absolutely are. Since the multiples are so low.

DrXaos

There were plenty of customers for network capacity, and video and mobile phone use only increased demand radically after 2000. That still didnt stop the bear market. The customers for AI physical infrastructure are AI sellers who are running on debt and VC capital as well. Just like how in dot com 1.0 lots of internet ad revenue which supported infrastructure and services turned out to be some other dot com’s ad budget which was funded by speculative capital. It’s the money in the AI end user demand which isn’t there yet to justify multiples.

shotsallover

We also haven’t gotten out of the VC-subsidized pricing. Uber and Lyft both went through downturns when they raised their prices after the money spigot disappeared. 

squirrel9000

That door swings both ways. Plenty of people acting as if this is some brilliant business strategy, when in practice this is absolutely a speculative play, what could be described as self-funded VC, on a scale that is highly unusual for a company that is otherwise a very profitable near-blue-chip Mag7. They do have that backstop but that does not mean that these stock issues are not highly speculative.

XYHopGuy

well no, that wouldn't be acting as a VC :) I took a 70% loss on my own startup options by getting the cash to exercise in exchange for shares. But I made money on it. Weird right????

TimeTravelingChris

They are listing because VC spend dried up in Q2 and companies figured out that unlimited tokens was a bad investment. Their revenue likely peaked in Q3.

Loud-Job-4056

https://preview.redd.it/yaqz44qontxh1.jpeg?width=941&format=pjpg&auto=webp&s=dc3a7b29f6aaf027b5de9f8e62f0fab193c973da AI made my cat into a dictator. Thanks dumb VC fund!

Least_Mall_9960

I haven’t paid for my Claude free version and I use it everyday. Some dumb VC fund is funding my dumb AI queries

VegaGT-VZ

Ed Ellison recently did a \~15 minute podcast basically saying this Multiples for all AI shit in public markets have gone way down and are reflective of what theyre actually doing to some degree Its the private market VC shit that is crack smoke priced. As scammy and grifty as the times we are living in have become to some extent the public and bond markets are still somewhat doing their jobs.

greenpride32

ORCL has over $650b in RPO. About $300b is tied to OpenAI, so even without them it's $350b. OpenAI is well funded and the big contract starts in 2027. So let's say OpenAI does not succeed long term; ORCL will still have collected large chunks of that $300b. The frontier lab exposure for ORCL isn't much different compared to AMZN/GOOGL/MSFT, main difference is those other companies have a larger margin for error. Estimates put VC investment into AI startups at the serveral hundred billions of dollars over past 3 years. I think there is a lot of confidence from the likes of NVDA, the larger hyperscalers, and the big long term investors that even if the currently leading AI frontier labs fail, there will be other parties to take in the demand. AI isn't going away. But the winners of that platform/application layer are still TBD.

vtribal

right now everyone is spending more on AI. and everyone is becoming more productive, especially in software. if everyone is more productive then that is the new baseline. i think we will see some capitulation as VC money dries out. i

ReasonableBrother448

Markets seem to love the stock issuance, it has been gobbled up. I was listening to some spokeperson of VC side of things and they dislike the bonds and circular SPV. It brings complications and restrictions, but increasingly a real threat in the form of crushing rates. A lot of things have happened in very short period and i expect it is not going to change. It becomes chaotic in the end. Credit market dries up, stocks start to be issued to reduce the risk, stocks go down (liquidity dries up from there too), government starts to provide emergency liquidity. We already saw a little bit of that with Intel.

xiaodown

No, the hell they don’t. They might make money IF you only count the cost of electricity and running the datacenter. They abso-fucking-lutely don’t make money when you factor in buying the GPUs, which are per gram like the 4th most expensive thing on earth after antimatter, bull semen, and printer ink; the GPUs will also need to be refreshed every about 5 years. The Nvidia 30xx (ampere) series chips are still valuable to home-AI labbers, but they’re virtually useless for hyperscalers, because they natively infer in int8, where the blackwells do FP4, which is 4-8ish times faster and about the same more efficient. The ampere cards are only now 6 years old, and they’ve been obsolete for 1-2 years. That’s just going to keep happening, and it’s going to make it extremely hard to get on top of capex without a MASSIVE price hike. And I mean massive; don’t be surprised to see 20x, 30x, maybe more, in a few years, when the VC and debt dries up.

SanDisk_Made_Me_Rich

1% of companies represent 90% of AI spending. Of that 90%, 80% is from unprofitable, venture-backed companies. So, roughly $0.70-75 of every dollar of AI spending right now comes from AI companies spending VC investment dollars. As a result, the revenue quality in AI is currently poor. This happened in previous cycles as well, like cloud, when the early users of AWS were mostly venture-backed startups. The thing, though, is that before AWS could scale and pull through GCP and others as legitimate cash machines, there were a few clearing events to sort out these brittle revenues. We will need to transition from speculative AI spending to consistent, reliable spend that shows up in public market earnings reports. This hasn’t happened yet because most of the breathtaking revenue growth comes from LPs investing in VC funds, who then send it to startups.

NebulaElectrical1467

Revenues are driven by speculative VC financing and cheap debt

TimeTravelingChris

The cloud providers aren't the ones losing money. It's the VC backed AI startups that are losing money (and starting to go bankrupt) that are using about 80% of the tokens with shaky business cases. These startups are also 80% of Anthropic's / OpenAI's business and at least one of them that went under specifically called out the nightmarish economics of metered cloud AI solutions.

TimeTravelingChris

For people not following most of the "demand" is VC backed AI startups that are in many cases struggling. Even 80% of Anthropics token usage is by these startups. So just know, "demand" is used loosely.

HungryCaterpillers

This is a terrible comparison. Amazon ran at a "loss" because they purposely reinvested all the money they made. Companies like anthropic aren't making money to reinvest. They're running completely on VC money.

oneind

Yes. Startup are getting valuation upward of 100 million right now and first phase is spending AI credits. Half of these startups are competing for same business and offering to customers heavily discounted pricing just to meet VC targets. So off course demand is high .

Substantial_Oil_7503

Do you think AWS was profitable on day 1? They needed to build out the infrastructure to deliver their services, and they cant build it quick enough. I dont know why this is so hard to understand, you are not selling cakes, you are selling services delivered using physical assets you need to purchase. They are not the baker, they are the people renting the bakery to the baker. It takes time to see a return on any capital intensive business. Could be trucking, mining, real estate, telecoms, etc. You dont see a return on capital immediately. I am not saying that AI is not being subsidized for market share by the service provider, but its amazing how such a simple financial concept is this challenging. You are getting too wrapped up in doomer headlines. Its not the VC's driving demand, they are simply enabling it. The market is driving demand. The context is being lost on you, suggest you go back to the top of the thread

WhyBecauseReasons

Demand from who is more important. It's going to be VC-based startups like 90% of the time.

mallory6767

Man you are missing the point. VC money is subsidizing everything and creating arterial demand. If I ope a cake store and sell all my cakes for $1 when it costs $3 to make them … I would sell a ton of cakes. It’s artificial demand generated by VC money. Also the build out is nuts creating artificial demand for chips, racks, data centers, memory etc

livzlivz

At the moment 1% of companies represent 90% of AI spending. Of that 90%, 80%-ish of this spend are from unprofitable VC backed companies. This is per Ramp data. Chamath Palihapitiya had an analysis of this on X as well as in his All In podcast.

Substantial_Oil_7503

Yes but with the expectation that profits will come? Its not VC money buying AI, its consumers buying AI. VC's are funding the build out to supply the AI. So again your point was that unless consumers are buying AI there is no demand, but that makes no sense because consumers are buying AI services. Billions is being spent on consumption every month already.

Substantial_Oil_7503

Agree, but their customers are the consumers and the businesses paying for AI services and while they are investing a fortune in compute right now the expectation is that increasing demand from those consumers will eventually pay the bills. The VC's are there to fund them until that happens. So the AI compute actually is being sold to consumers, thats the point I am trying to make.

fmcfad01

World ain't getting safer and I think there's another last supper moment coming for VC backed Defense Tech. The primes as the going to have an M&A field day when all these startups run out of runway. Bullish.

DiceKnight

Zero interest during covid did not help. Most if not all of the LLM bubble's fuel is VC money and they got fat as hell during the zero interest years and SaaS plays. They've been on a long loosing street since though.

TheRebuild28

They went public because of filing requirements due to number of employee share holders rather than many rounds of external VC. So really doesn't apply. If they raise capital same way Google did this year maybe they would want voting rights especially if raised from institutional investors.

DelightfullyShadowy

The ego on these guys is something else. Everyone thinks they're the next Michael Burry because they can code a linear regression and have a contact list full of VC money. Dude basically ran a leveraged fan club for his buddies' companies and called it a fund.

Careless-Reserve-965

Based on what? Their non-profitability? They've burned hundreds of billions of dollars so far. They anthropic alone has 400 billion in non-cancible commitments by 2030. Who's going to pay for all this going forward? PE/VC has pretty much been tapped out

No-Detective-6229

dilution, overhang, overpriced, missed deadlines, ultra competative industry, customer concentration, winner take all contracts...Small to mid cap defence is not for the faint of heart. I'm approaching VC style. I put a little in every name, some wont make it, some will just barely survive, but hopefully the winners will make up for the losers in the end.

Pitiful-Recover-3747

I work in consulting for health plan compliance and we’re taking hard looks at how plans are using AI for clinical decision review and quality management. The health plans want to had off the decision making to AI yesterday so it’s near instantaneous and usually right. The lawyers and doctors are pounding the table that they’re going to literally kill people. The problem is the different AI models cannot reliably look at a patient and identify which ones need to be pulled out and sent to a quality committee for a higher level of review. There’s so many different types, methods and sources of data captured in the health care space that the AI has had to focus on learning that it cannot accurately anticipate what is likely MISSING from the patients history. For example if you have patient that was brought in by homeless out reach services to a county ER, you know as a doctor there’s an infinite number of social determinants of health and prior history that’s likely not reflected anywhere in the Medical records being reviewed. Especially if that individual is transient between areas and is the first time being captured in that health system. While that example seems niche it happens. 1000 times a day easily. But the AI labs keep pushing they’re 95% of the time we’re 100% right to every board in corporate America and it’s going to have disastrous downstream consequences because there’s zero legal gaurdrails out there. And the startups that are specializing in different niche applications are all being founded and run not ny experts in those industry niches that understand the challenges and risks but by cast offs from the AI labs who found a VC figure they’d sell their soul for. Ugh. It’s fucking depressing to see so much potential just going to get absolutely twisted and then used to sodomize society at large for some sweet ROI and shareholder value….

Tr0janSword

No. This is essentially Amazon invested in Anthropic a long time ago, but instead of getting equity immediately, they structured it as a convertible preferred shares that convert at that share price. They do this structure for founders/employees to prevent a big tax event on their own stock options. Very common in VC world. Anthropic’s valuation goes to $965 bn. Those Amazon notes are worth $80 bn. But, bc it’s a convertible note, it’s a call option worth $80 bn accounting wise. So, Anthropic reports a $72 bn loss, but it’s not real bc the notes convert and Amazon gets the shares they would’ve gotten if it was just a boring equity investment.

IDatedSuccubi

No VC funding secured

addicted2soysauce

It only just shut down 5 months ago this May. They had time for retooling and to jump on the AI VC train.

LucaRossi0

Slap a ChatGPT API onto the Ask Jeeves website, rename it 'AskJeeves.ai', call it an 'Agentic AI Butler', and raise $50M from VC funds before lunch.

ctenidae8

That paradigm shift is going to hit hard and fast. Model efficiency, distributed processing, and better use cases will cut the demand for huge data centers. The effective leverage on these things is shaky. When it happens, like in .com, institutional investors will cry about the denominator effect. This time, though, their pulling back from VC investments won't hurt so much.

shiny0metal0ass

No one in tech is left. Lol they've fucked off or gotten "layed off". They're all just the VC shitheads that we used to ignore when they whined once a quarter. They took over and ran it into the ground. Then they thought they "solved labor" because of the fuckin thing that used to generate those meme Harry Potter scripts. Now we're here.

_hiddenscout

Maybe. Just my opinion, but it think it’s more complex than yes or no. There are pockets that are bubbles. That’s more of the VC funded stuff. Think like character ai that just went bankrupt. With the semis, daya centers, power, the issue is that all the money is coming from the hyper scalers with now are cash flow negative. There are going to be bumps in the road and at some point we will see capex cut. However, it’s a technology that isn’t going away.

OverjoyedBanana

Sold out to a startup with 3 months of VC money left isn't much of a warranty

Syllabub_Visual

Yep, that’s what I’m working on these days and my startup involved small businesses. There’s a stupid amount of money in this area and it’s astounding all the big name VC’s are looking past it.

Deto

The problem is that if all this compute is being used by startups that are burning VC cash and nowhere near profitability - it's not a durable situation 

FastYetSlow

Because there’s endless VC/institutional investment on the hope that white collar work will be automated thus saving these companies billions of dollars.

Syllabub_Visual

Omg this hot Miami chick stole my card and tried to buy herself a $70k worth of jewelry and handbags (was declined because bank detected it as fraud; initially thought it was 35k but now I see she attempted to buy things THREE different times). I don’t even feel like doing anything because she’s hot (a nice Colombian lady), but I honestly can’t believe they’re like that (and we don’t even know if the name she gave me is even her real name). She even ADMITTED to it over text (astounding that she’s that dumb). Apparently THAT’S how they fund their lifestyles - they either steal or some guy pays for it, but they still get invited to yacht parties and even mar a lago. She’s hot and socially popular and apparently doing shit like this is how she thinks she’s gonna get ahead in the world. Side note, her story was that she was making money doing you know what then some wealthy russian guy was paying for everything then he dropped her. There are so many red flags here and even if she’s hot she’s such a low life. Truly depressing when you realize that this seems like the ONLY way to be able to get companionship (it’s ONE of the reasons why I’m trying Miami and it’s also where all the tech bros and VC’s moved to). 50 miles north of Miami there are a lot of hot NORMAL girls but they tend to be a lot harder to land.

flummoxedbeing

Everyone's focused on CoreWeave's supply side but nobody's running the same analysis on the demand side. Strip out the VC subsidies from every AI startup currently renting compute. Ask them to finance their own GPU spend at 5% coc against actual revenue. OpenAI: $4bn revenue, $9bn operating losses. Anthropic: burning cash, just raised at 10%+ junk rates. Every Series B AI startup burning $2M/month on GPUs because a16z gave them $50M and said figure out the business model later. The demand for compute isn't real economic demand. It's venture-subsidized demand. Companies spending investor money at zero effective coc because the IRR math lets them burn it while they figure out if there's a business. The dependency chain is: VC money >AI startup demand> CoreWeave revenue>CoreWeave debt service. The bond market didn't price 60% default probability because CoreWeave missed a payment. They priced it because they read the chain. Both sides of the market break simultaneously at 5% rates. That's what the CDS market saw that the equity market is still ignoring.

DubiousChemistry

Kind of the plan while I wait out this drawdown. VC fucks aren't getting my money because I don't have a startup and don't invest in private equity. Algos can take but also give, that buy program on Thursday saved me a ton of cash.

New-Combination-1583

You won the game. VT and chill - unironically. you can live like a king off the dividends and cap-gains. I have no idea who you are but I legit hope you take that path and never play the market again. Don't let VC fucks or algos take your money.

Tallwhitedude123

Of course it’s not just that. Look at valuations AFTER these sell offs. The valuations are elevated but not in bubble territory. I would say maybe we hit a bubble but we are not there yet. Yes, literally everyone is laser focused trying to sniff out a bubble. First, we are not in a bubble. All this hinges on AI spending and how long it lasts. Right now we are back in the period of guessing it ends or slows soon. Also, another huge difference. The dot-com startups literally had NO REVENUES and vc money stopped flowing. OpenAI and Anthropic have MASSIVE revenues that are growing fast and costs are dropping. VC flows are actually increasing into these frontier labs

Just_Priority_9446

This VC guy on cnbc is a fucking loser

No_Way_6258

With what money? Does VC still have money left? More debt with high interest?  

Ready_Pen7712

There's buffetting, investing, VC-ing, trading, day-trading, betting, gambling and MoneyBurning. At this level You need the whole firefighting department.

Perspective-Parking

How do you put any value on a business that cannot and never will generate a single dollar of earnings. It’s just incinerates capital and VC money lmfao. A capital destroyer is not valued at anything. It would simply be priced at book value because there’s no value in the earnings or cash flows. In fact, negative cash flows is a liability not an asset. So you’d pay people to not own this company. This is still 1.5T too much.

SoSuccessful

You think? Recruiting is like the main function required to grow portco's. Having help from your VC is really useful and cost efficient.

rgbhfg

Get that debt from whom? They’ve already tapped the entire VC and Saudi money. The remaining places are retail or fed reserve

JungleDiamonds1

Crazy valuations for a company that just abused VC money to over market. Thanks for the free yeti

BabyWrinkles

Just had a moment of realization: I almost wonder if the proliferation of high quality open weight models is driving intentional scarcity of high end GPUs so that the money keeps coming in for the big frontier labs. We’re definitely in the VC phase of AI pricing - think early Uber where they drove taxis out of business with cheap fares, but now are more expensive. The hens will come home to roost at some point, and they’re having to throw all this money at infrastructure and model training in order to stay ahead of what someone can run on a decent GPU at home if they’re OK waiting 30 seconds for the task to complete instead of 5 seconds. So monetization is coming - it’s just a question of whether they can deliver a super compelling product at a sustainable (to their business) price point before enterprise figures out how to roll their own for less.

PassableForAWombat

Alright. For the low, low cost of $400 a token. I will allow people to use my generic AI model running from my NUC. 10/5 availability. Take it or leave it. Money please, VC

TimeTravelingChris

This has to be a joke comment right? None of this is being funded by actual cash flows. It's almost all VC money being lit on fire along with circular financing.

FearIsTheMindKiller9

This thing looks like Dotcom (fiber overbuild) with GFC financial games (bad loans). you can huff the AI paint all you want but anyone working in the industry knows how much this demand is being fueled by VC cash and circular financing. that's not a healthy market. you can be long AI technology and still have a negative outlook on AI companies in this cycle. do with that information what you will

RuleSafe6767

Coreweaf debt on secondary markets hit 15% today, which means they will need to sell new bonds at 15% coupon if they need more money, so they're effectively frozen our of getting anymore capital. Their only hope is private B2B, like more rounds of VC injections or direct deals with guys like nvidia (they could do a cash for shares deal).

Strong_as_an_axe

LLMs aren’t the route to AGI or RSI. These companies have no moat. They’re pushing like crazy for regulatory capture because they’re incinerating cash. Gonna see a lot kore fuckery yet just because of the sheer scale of VC that needs to be made whole

NoCommonDog

Scam Altman has gotta be regretting his choice to delay. All his VC investors are getting blue balls waiting to get their money back.

BumHand

I actually know someone who was a recruiting lead there a few years back. Definitely not a hot chick unfortunately. They worked in tech recruiting for hyper scalers and FAANG around 2010. Moves into leadership recruiting and eventually poached to a VC.

LocksmithNo2374

Yup agreed. Negative signal re. VC

NeverDeltaNeutral

I get major schedenfreude thinking about the VC money locked up in these AI companies. Particularly the smug clowns who invested the latest rounds who thought it would be a quick flip before the IPO. Regular companies that use AI will be the ultimate beneficiaries, not the hyperscalers making a commodity product that is more capital intensive than trying to dig to the center of the earth

ghreddinsoggles

VC still balls deep funding AI companies - NBIS will reap rewards whether they succeed or fail

Hamachiman

You’re right. Pop quiz: When is Anthropic’s top? And how can you tell the difference between a buy-the-dip opportunity vs a drop that will never recover? For all those 50x - 1,000x companies I mentioned, investors got more and more confident and more and more complacent. Every dip always led to higher highs…until they didn’t. I remember the complacency well…I was running a VC backed dotcom and the management team were cool as cucumbers in the year 2000, thinking it was yet another short term panic that would pass, just as every other one had for the previous five years. But it didn’t pass, and NASDAQ didn’t regain its peak for 15 years, by which time virtually no investor was still holding on. And a company that goes up 50x and drops 98% is break even, but ONLY if you bought at the absolute bottom. Fund flow data proved most people bought near the top, which is why euphoria marks tops and despair marks bottoms.

Every_Way_8671

Here’s the trade; put $1k into each of the big AI companies, you’ll either be a billionaire in 20 years or money itself will be worthless. People forget that the corporations and rich live in a socialist microcosm, it doesn’t matter how much money they lose, the government or VC’s will just give them more. Especially when it comes to AI, they will empty Fort Knox because they believe that whoever creates the first AGI will rule the universe.

flyboy573

You are underestimating 1.) how sticky enterprise spend is, 2.) there will be a market for enterprises to have long term contracts with Anthropic “because they’re the best”, even if they’re way more expensive and 3.) The frontier labs are desperately trying to improve unit economics through economies of scale.  If they can offer AI at a fractionally lower cost than other players, they then could lower their own prices, maintain (or improve) share volumes, and yet still have higher incremental margins.  It’s tough to swallow though. This is VC math at the scale of mega cap tech. I don’t have a crystal ball of how good (or meh) the incremental margins can get to. High risk high reward investing. 

pragmojo

Idk - I think it's significant, if they couldn't manage to raise again, and maybe it's the end of VC's throwing endless capital at any company with "AI" in the name, but it's not enough to signal a bubble pop incoming. Character AI was betting on AI companions, but the market has moved towards AI use-cases that produce work in the economy. I.e. coding agents, ai assistants etc. And Character AI wasn't high enough on the fear index. To get funding these days, your product can't just kill a couple of teenagers, it has to be an existential threat to humanity.

doctorqaz

Make your own chips at home -> set a “projected revenue” (use roulette) -> file for IPO or sell for billions to a VC = 💵

greytoc

Paul Pelosi isn't a politician. He founded and runs a VC and real estate firm which he uses to manage and invest. He happens to be married to a politician which is why his trades are made public. The problem with picking a single trade out of a position is that you may not know why the position is being held. Especially when the investor may be constructing a more holistic portfolio - so the challenge will be to understand what sort of sizing to use. It doesn't mean that you shouldn't follow someone for inspiration and ideas. But you also have to be aware of the disclosure lag. Also technically - politicians aren't insiders. If you wanted to follow insiders - you ought to look at the SEC Form 4 filings. See my followup discussion below.

Eleina_Edelweiss

Its junk honestly antrophic and openai is a dumping ground for VC. Its their exit strategy. Once they hit their target price they will dump hard on the market. If you dare to play keep it short and tiny to minimize risk. Im not touching those with a 10 yard stick. But again i dont play stock LOL.

Available_Way_355

What is the VC fund that invests in Chinese child labour rare earth refineries and what’s the required invested capital to join ?

Syllabub_Visual

Anyone who isn’t living in the HOT parts of Texas or Florida is making a mistake. No taxes, all about liberties and freedoms, and no socialist and trans bs. Plus these are where the hot girls are. Sigh feel that California SHOULD belong but only if Steve Hilton wins this fall because that state is run by a bunch of crazy liberals even though there are a lot of hot people in socal. It’s truly a shame that some of the greatest cities in the world, NYC, LA, SF, London, and places like that are run by a bunch of big government liberals who like high taxes and bs regulations (and trust me I don’t even like 🥭 and his stupid movement) so that’s why many of us have moved to Miami instead. Instead of losing everything on 0dtes, you could buy property down here because it’s where everyone wants to come and the values are about to SKYROCKET. Guess Seattle has no taxes as well but they just put in place their new “millionaire tax” and it’s cold and full of people who aren’t hot. All the tech companies and VC’s have moved to Miami and I have no doubt nvda will next so a pretty good time to invest in the city…

Rymasq

"cheaper players" When has that ever happened in tech. VC literally bases their entire strategy on the knowledge that tech has a high barrier for entry

RaspberryPrimary8622

There is no stickiness or vendor lock-in with LLMs - individuals and enterprises can and do change providers easily and quickly. The VC cash spigot is almost over. Both OpenAI and Anthropic will go bankrupt within the next year or two. They placed a massive bet and they will lose that bet because their revenues are nowhere near enough to cover the hundreds of billions of dollars in debts that each has incurred and cannot get out of. Their technology is useful but nowhere near profitable. Their Effective Altruism / Rationalist ideology instilled in them a lot of magical thinking about the transformative potential of LLMs. These people have seriously weird beliefs that detach them from the business realities of their product.

A55BAG

Dumb VC smooth brains should keep their 'girl math' in private markets.

Medical_Lengthiness6

LLM tech is barely different from 4 years ago. You just keep hearing exponential and parroting it. We got better harnesses which is software. Not exponential advancement. It's moving context around and sheparding the LLM better. The models actual intelligence is not exponential and all the experts have said this. It stopped back at GPT 5. For coding they are often even pulling back models because they are worse. It still hallucinates, just a little less. Generative video and photo fixed the finger issue and looks better but is still clearly AI and creepy. Look at things rationally with direct comparisons. Not via the AI CEOs/VC marketing and fear mongering. Comparing day 1 chatgpt to now there's been obvious big improvements but LLM technology is not exponentially growing. The marketing around it and the number of agents they run at the same time (the software) is changing but it's not exponential change, it's just moving stuff around into different configurations.

Drew707

They don't need to right now. They use the VC cash to keep the burn rate manageable while they drive adoption and stickiness, then once they are comfortable with their MAU, they start optimizing, which they've already began with Sol 6.1 for OpenAI. This is a tale as old as Silicon Valley.

daveedgamboa

I agree, feels like a classic case of VC money then charge like mad a la uber, postmates, etc. First they need to show the use case, overrun status quo and get us hooked. Then voila. Not to mention all the routes to revenue such as ads which are just getting started and data as well.