VC

Leaper229

That account is supposedly molded with inputs from various parties and I have found no credible challenges to the book’s accuracy My previous VC experience in the states also allowed me to verify Altman’s record at YC to establish that he’s a pathological liar So yes. When narratives clash, I’ll automatically assume Altman’s is false

TimSylvester_

Right, Huang will almost certainly flip to a VC investing in AI & chip companies, or rake in *billions* of seed funding to set up a new AI chip firm.

noradrenalinenjoyer

Not a local but pushing NYC and any other state is quite tricky I don’t think VC, funds big tech ever moved that much to the east cost. And for example Chicago is still Mecca of market makers despite all bad news happening there People are really delulu sometimes when they bring points — move out to X city or Thailand to save money

No_Station_7825

>And in so doing he priced a lot of gamers out of the market that built his company. Oh no, what a tragedy. Genuinely I am not sure how to respond to this comment. You think he makes more money selling GPUs to AI companies flush with billions in VC funding or gamers? >Yawn. Even Tesla is propped up by pure hype. They have 2 deliverable products. SpaceX also has 2 (since Starship is still in testing and hasn't delivered any payloads/contracts. I have been hearing this on Reddit when Elon was worth 100B and he's now worth a trillion. Idk man, seems almost pointless to say it at this point don't you think? How many more years are we going to keep saying it? Especially when he went to the right, lots of people especially on Reddit pronounced Tesla dead, that he attacked his own market or whatever. After his salute, the Europoors confidently pronounced him dead in Europe forever, but Tesla sales in Europe are rebounding. It's okay to admit you don't understand something. You've been wrong far too many times to keep repeating the same thing, it's like a self-soothing lullaby at this point. And I fucking hate the guy fwiw but I can acknowledge he's a heck of a lot smarter than Reddit says he is.

Genghiskhan742

It does act in separate interests from the actual central Chinese govt regardless of some ownership by the state, and the Chinese state is the main investor and VC in China anyways. Denying corporate agency I think is quite dismissive when it’s very plain to see that the actual central Chinese government does not want western chips

pm_me_yo_creditscore

Anthropic's annual personnel spending runs at an estimated **$6.4 billion to $6.8 billion** on an annualized basis, with **cash payroll** (salaries, bonuses, benefits, and payroll taxes) accounting for roughly **$2.1 billion to $2.4 billion** per year. \[[1](https://www.google.com/goto?url=CAESlQEBxCJF1wkl_Etuq_TEfPe0mHM7XI687ws3UhrNBJrMPXI5a_Kblz5GHymc_Vj59_A11VyvRsYcA6_6GSiUoPYnGJPcGYHYtTzt7dndxmN03uUvIDfy63LspfTk6TU6GUedMyueUfRhULIZj3Rmo-j5l89dHOHaodEarNjOkJ74Cg_RVhOuJIh36i-uTP7MMfpz7PK_0g), [2](https://www.google.com/goto?url=CAESoQEBxCJF189rhvNFwqBBmOT5QHyK4pNpPqJC_9s_U_izgLRQ8PrZgmPOeHWIYG4KWC6u7pCBhNLGAB2NyyO7iAa64uZk6Vee4LlbZ9VfSVGrLvqjK-qHzV1-Z-IaSk3FPj5Fa_TEXH8z-qU6Tp_ZKPAzcaHyCvfELboSrUf5StQJ0XCccGMGiK3VC4NMQT8on99X3k2l_eamPop1vN1eI0NcnA), [3](https://www.google.com/goto?url=CAESjAEBxCJF11drAmucqWLDnwSabjECaM7A9dcLavOVq3fVtnzqV_sQkJWh0uH_BTiz0tsVONunp9PB3jVF9XpbkV4-AlmJI2V7DfJpIpPg5mOo_376GSLYOdBBb6lfan4HBX-bTuwPdWuZN4-1BVK38azQRMANn-zM_80v5BLGRu6qBGCElmOxMBOA_2SK0A)\] According to Anthropic’s late-2026 S-1 IPO filing, the company employs approximately **5,300 people** and reported **$4.8 billion** in total personnel expenses during the first nine months of 2026. \[[1](https://www.google.com/goto?url=CAESjAEBxCJF11drAmucqWLDnwSabjECaM7A9dcLavOVq3fVtnzqV_sQkJWh0uH_BTiz0tsVONunp9PB3jVF9XpbkV4-AlmJI2V7DfJpIpPg5mOo_376GSLYOdBBb6lfan4HBX-bTuwPdWuZN4-1BVK38azQRMANn-zM_80v5BLGRu6qBGCElmOxMBOA_2SK0A), [2](https://www.google.com/goto?url=CAESuQEBxCJF18rxNaFWlgvNpi0y4iAparb5ajbHedeR7DzF-m1OHJ75iumy-v4bSfuK9SpmhXP9bd4DjI8jdarWmM6uexNbIk03lAUk6n7cEJODYWH5ACuLml3WhmcfclibVsnJS501KYFZs7g3L3_h4IicTprJ5s4ra4CSZVkTV58hk0Zyc5sxndZ4XtnSOpAgkqzLGf_0RIqR--hoRKsbTArXdf-P8tzuLyCcXp0PqH_2ek3yevGal7xbhQ), [3](https://www.google.com/goto?url=CAESoQEBxCJF189rhvNFwqBBmOT5QHyK4pNpPqJC_9s_U_izgLRQ8PrZgmPOeHWIYG4KWC6u7pCBhNLGAB2NyyO7iAa64uZk6Vee4LlbZ9VfSVGrLvqjK-qHzV1-Z-IaSk3FPj5Fa_TEXH8z-qU6Tp_ZKPAzcaHyCvfELboSrUf5StQJ0XCccGMGiK3VC4NMQT8on99X3k2l_eamPop1vN1eI0NcnA)\]

CaryGr25

My guess, some VC will hire him.

junior150396

AGI it's the cold fusion of the tech world but the "it's just 10 years away from being a 10 years away" is "it's 30 billions of VC money away from being 60 billions away"

StraightOutOfZion

Reminds me of what going into Bay Areal VC offices was like. They had a type in the admin tier

Ok_Cry7572

Jensen very well might start another chip company He could raise billions in VC and make a competitor to Nvidia. Not sure this is being priced in right now

Defiant_Car_6763

Mark Stevens, a VC on the board, selling close to 1 billion worth of stock in August and September but sure yeah no “material” insider selling lmfao

Successful_Owl_

Problem is Anduril is a joke and will be gone after this administration no matter how much their CEO brags about being a Democrat. They are all PR and blowing VC money with little payoff.

mayorolivia

That’s not the issue. The issue is Elon made sure to have majority voting rights. Jensen doesn’t have special voting rights. Zuck also has majority voting rights and same with the Google co-founders. Jensen had to give up equity and voting rights to raise money when Nvidia was a young company. Elon negotiated it at Tesla while Zuck and Google cofounders made sure to get it before going public. Because they had such amazing businesses pre-IPO, their VC investors agreed to give them control.

Bluecow71

I have been in Anthropic for over a year through a VC fund

gamestockhq

why is a debt facility in the VC comparison? Would split loans and equity before comparing the two countries.

sck178

I just heard someone describing VC AI investment vibes as "beer bonging kool-aid" and I gotta say... That's fucking hysterical

rudolf_de_Leeuw

Stripping out the two megadeals is the right call, and the similar median round size is the more telling number to me, because it suggests the gap sits in the very large deals rather than in typical startup funding. I'd be curious how much of the Chinese side runs through state backed funds that never get reported as normal VC rounds, since that could understate the chip and robotics totals.

redditdinosaur_

it’s more like VC

Sp00kyC4py

Bearish until earnings come up next week. Then bullish until the AI trade unwinds due to unrealistic financials and leverage to the tits from the different hyperscalers, as well as the velocity of money slowing as VC money continues to dry up (i.e. see SoftBank taking continuous beatings while doubling down on AI).

FuckingJPMAlgos

Doesn't matter, we gotta get the VC money out via retail bagholders. It's so negative out there that it's positive in the future

TheMSensation

Isn't that the case for every VC? Fund everything until you find the unicorn.

userhwon

This isn't a bank, it's a VC. And including this loss of $7 billion, their net income for the past 18 months is about $25 billion. So, hope that answers the question you asked, and the one you didn't ask that would have prevented the one you did.

Ok_Worldliness_2902

Y'all excited to be Anthropic's VC exit liquidity?

kashkash21

as much as I dislike that part of redoot this is late stage capitalism. IPO's now in the trillions as oppose to startup worth few million and grow over 20 years. Anthropic's growth was all behind VC doors with zero transparency

__Augustus_

You ASTS people are just as delusional as the folks who actually believe Starship can cost $10m/launch and build space data centers. ASTS' launch vehicle is a blindlingly obvious VC scam and they also don't give a fuck about basic things like avoiding collisions with other satellites. Not a serious company. Why buy parts from Firefly to LEGO together their own rocket when Firefly could just launch satellites on Eclipse? And with what launch pad? LOL

brooke0morse

“VC associate (worse)” is the most accurate part of this entire chart.

mezolithico

Her husband started a VC firm, their wealth comes from there, her stock trading is peanuts compared to his firm.

No_Veterinarian742

oh for sure. FOMO is insane at the moment because things could scale way faster than before. and I agree the AI bubble risk is primarily in VC and private credit at the moment. there is some on the silicon side in the market but those players are all big and mature - they have inflated margins right now but can survive at lower margins. and the PEs have been coming down a good bit this year on at least some of them so a lot of the bubble air has been taken out already on that front.

Hacking_the_Gibson

Not if you see the size of the seed and Series A rounds these days. Companies are "worth" billions within three months of launch because greater fools are insatiable.  The AI bubble is in startups and VC. 

LoudInteraction1761

The shares held by PE and VC firms do not belong to them; they belong to the LPs (Limited Partners) who provide the capital, such as pension funds, wealthy families, and university endowments. Finance firms are merely intermediaries and managers. You can ask an economist, or google, or AI, or whoever you want.

halmyradov

Look at what happened during dot-com bubble, companies went from +1000% growth to -85% growth practically overnight. If you think current ram prices are gonna stick for much longer and VC will keep funding these insane capex numbers, you are delusional. Mu and sndk will enter negative growth territory, doesn't mean they will be losing money but they sure as hell won't be making exponentially more money. It's a simple rule of supply and demand, if there's a demand for a product with 70% profit margins there will be supply in bucket loads. The only question is time.

Puzzleheaded_War6102

That’s literally the dumbest thing I’ve ever read. You think PE, IB and VC is investing in these scams so they can exit at lower valuations?

gezafisch

Amazon could afford to operate at a loss because they were building a concrete path to profitability in retail and AWS. That's not a valid comparison imo, because AI companies only path to profitability is price increases - where Amazon only needed to build out it's infrastructure to achieve economies of scale, AI has no hope other than drastic improvements in transistor technology. I think AI will have an impact, it already has. But I do think that you and most of us are completely clueless regarding the real costs of running these companies once all is said and done. Expansion will come to a shuddering halt sooner or later, whenever VC decides they've lost too much money

approximately_exact

The VC clowns are trying to suggest how its "just 1.1T" so that you think it's fairly valued and buy anyway. And yet, it's not even close to fair value even now.

Strong_Brick_9703

Capital is not a problem. The real problem is that FA is run by VC's from another hedge fund. There is absolutely insane story how they got there, banning Max Polyakov and forcing him to sell his company. I mean, there is nothing about actual space left here. Only (taxpayers) money.

pjank85

The no moat means that if Gemini or OpenAI or anyone else relrases a better model - any developer can switch models with 1 click. This is not Gmail or Outlook where migrating data is an issue. This is not AWS vs GCP where a migration can take months. It literally takes seconds. And this business hinges on AI subscription prices (that are heavily subsidized by VC capital) increasing while we already know that open models put a heavy ceiling on that.

Governmentswallows23

$CRWV and $ORCL can't expand and continue financing operations with debt, can't repay loans (hits VC, PE, Inst. Banks). $NVDA loses some of its largest customers. $GOOG, $MSFT and hyperscalers lose huge portion of future growth prospects as compute supply is evaporated, struggle to pay back loans (further hits financial firms, chip firms). OpenAI and Anthropic can't meet its compute commitments, possible default on debt as well. It's all a grade A cluster

erixville

The problem with AI right now is that the price you’re paying/willing to pay doesn’t cover what running it costs. AI developers and hyperscalers have completely mismanaged their finances and leverage. It’s useful technology but as of today there is no way for current usage and future commitments to be met. It’s all hype and VC money keeping it afloat. Private customers aren’t paying nearly enough, and anthropic’s S-1 proves it. That money is going to dry up for one reason or another and it’ll get ugly. The technology is here to stay but I don’t see any way that this all doesn’t crash.

Reaper_1492

It was a suspect valuation to begin with. The only reason they are even going to market is because they don’t have the cashflow to sustain longterm operations and they need to pass the buck from VC to the public so they can draw an “infinite” amount of money from the markets. I can’t believe anyone would willingly buy it though. You know you’re just going to get diluted into oblivion because they don’t even have a path to profitability. Without funding, OpenAi and Anthropic are in deep shit.

Sp00kyC4py

AI as a broad umbrella is generally useful, if we include machine learning, deep learning, simulations like for molecular biology and such, etc. It's not normally that profitable, usually giving linear returns for the cost of research (with some exceptions, i.e. quant research in finance). LLMs are what most of the bubble surrounds, and they are essentially automatic predictors for text. Like what's inside of your phone. They have proven to provide little to no significant value in corporate productivity, despite management coercing their employees to use it for the last year. They are maybe good for some software development purposes, but solely for programming, and only some of the time (requiring an excellent senior+ SWE to determine if there are major design or security flaws). In short, LLMs have some uses, but are maybe a multi-billion dollar product. Certainly not worth a trillion dollars. Most of the speculation IMO comes from a major institutional crisis in Silicon Valley where the VC grifters (i.e. Sam Altman, Dario Amodei, the MBA yes man CEOs/leadership of the Mag7) have become the most powerful voices while the real innovators cashed out years ago. Wall St defers to these guys, and like our bosses, they have now learned why that is such a horrible idea.

ph-sub

Enterprise is cutting token usage and/or switching to open weights models. Anthropic and OpenAI have no moat and now investor appetite has softened for more debt raising. OpenAI’s latest funding round fell short. Anthropic’s valuation is going down. They need to IPO as the VC money tap is dry, but the market is turning against them. These, also, are facts.

swagonflyyyy

The problem is that this market is hanging by a tech thread supported by a ~~cartel~~ circular financing scheme composed of mostly overvalued, unprofitable startups and overleveraged competitors riding on pure speculation-fueled VC money that was already beginning to dry up this year. With such weak fundamentals and a near-nonexistent history of profitability after trillions invested, it wouldn't be a surprise if the bubble collapsed like a line of dominoes that will punish the market for causing a critical supply chain crunch and obscene concentration of wealth tied to said companies. Seriously, a massive, nationwide datacenter halt would be quite the nail in the coffin for these companies.

DJ_Mixto

This moron can't help himself. Truly, truly juvenile. Quick reminder - the Dems don't have a thing to do, not a thing they can do, for months. The AI bubble has been threat to burst for months and the VC money has already been very nervous about the circular spending. Musk has warned specifically about the pending move to consolidate. Dems issue? Not yet. Nada. Nyet.

Stock_Mark_7823

In 2000 Cisco briefly became the biggest company in the world ($555b at its peak) because it supplied the critical routers behind the internet. But Cisco still fell almost 90% because investors got carried away on the story and overpaid. The exact same trap is breaking the market today. When the APLD, WULF, NBIS, CRWV's of this world collapse 90% - which they will, casual retail idiots will scream that AI failed. No. The tech still wins. It just means investors massively overestimated how much actual cash flow these middlemen could capture. Look at the circular economy fraud happening right now. Neocloud startups borrow billions in high-yield private debt to buy chips from Nvidia, then try to rent that compute back to the ecosystem. It’s a closed loop of fake numbers. The second VC dries up or local voters block power grid links, which just happened in 40 out of 41 election ballots the loop snaps. The neoclouds go bust first. Lenders seize their GPUs and dump them onto the secondary market for pennies. Nvidia's backlog vanishes overnight because nobody needs a new $30,000 chip when bankruptcy courts are selling them for dirt cheap. They have the independent cash flow to survive 16% interest rates. They will just wait for the bankruptcy courts to liquidate the wreckage, scoop up the data centers, power links, and GPUs for 10 cents on the dollar, and own the next 20 years. A lot of arrogant investors are getting hurt right now because they paid too much for the hype. Just like Cisco. Caveat Emptor!!!

wavegeekman

Apparently I am not allowed to link to a very relevant YT video on the topic so here is my post without the helpful link. Thanks mods! I went through the math. It is not obbviously unviable. There are addvantages. Almost limitless solar energy at full intensity 24\*7. No local busybbodies holdding up permits. No price of land. The main downsides are launch costs and heat dissipation. Heat is dissipated by radiation - yes you need plenty of area so that is a downside. Lunch costs are coming down and likely will continue to fall fast with the starship. Given Elon Musk's track record it likely will take longer than first thought. Though that is true of most projects since forever. How's the Caifornia High Speed rail coming along? But on the other hand it is widely held in the VC industry never a good idea to bet against Elon.

WaterNerd518

Existing and being a vehicle for fraud are two different things. It will exist, but if we get the hype under control, accept its capabilities/ limitations and stop making a mechanism for stealing VC dollars, it might not destroy us.

Mission_Pirate_4150

I’ve spent the last 20+ years watching Intel CEOs that were nothing but accountants. They may have started in stem, but they became accountants. Today’s ceo is a VC with a stem degree. I remember some statements from Craig Barrett 20+ years ago and I thought, “what a sh@tty thing to say about engineers in your own company.” About 10 years ago, I listened to the then Intel ceo say that they didn’t need EUV to hit 10microns, they spent years not being able to produce 10microns on that process, and finally having to give up to buy EUV machines from Asml. In basketball, a great coach can’t teach height. In vlsi design, you can’t teach small, it is that simple. You always need to be smaller and you always need to be on the absolute cutting edge of manufacturing. Intel’s manufacturing is second rate today. TSMC is the industry leader. I remember when TSMC was a joke. I remember “real men have fabs.” Intel took their lead I watched as Apple submitted bug reports after bug reports in skylake and Intel didn’t get them fixed. I watched Intel poopoo low power. No, mobile is not laptops with people dragging around power bricks and Ethernet cables. I remember shaking my head 20 years ago in this. Now, this was specifically not just Intel, but Intel was in that group. I remember when Intel said that the iPhone wouldn’t ship in enough quantity to justify producing for Apple. I knew in 2006 that was a horrible decision. Intel is just full of incompetence in my view.

Mission_Pirate_4150

I’ve spent the last 20+ years watching Intel CEOs that were nothing but accountants. They may have started in stem, but they became accountants. Today’s ceo is a VC with a stem degree. I remember some statements from Craig Barrett 20+ years ago and I thought, “what a sh@tty thing to say about engineers in your own company.” About 10 years ago, I listened to the then Intel ceo say that they didn’t need EUV to hit 10microns, they spent years not being able to produce 10microns on that process, and finally having to give up to buy EUV machines from Asml. In basketball, a great coach can’t teach height. In vlsi design, you can’t teach small, it is that simple. You always need to be smaller and you always need to be on the absolute cutting edge of manufacturing. Intel’s manufacturing is second rate today. TSMC is the industry leader. I remember when TSMC was a joke. I remember “real men have fabs.” Intel took their lead I watched as Apple submitted bug reports after bug reports in skylake and Intel didn’t get them fixed. I watched Intel poopoo low power. No, mobile is not laptops with people dragging around power bricks and Ethernet cables. I remember shaking my head 20 years ago in this. Now, this was specifically not just Intel, but Intel was in that group. I remember when Intel said that the iPhone wouldn’t ship in enough quantity to justify producing for Apple. I knew in 2006 that was a horrible decision. Intel is just full of incompetence in my view.

boat_hamster

The banks should be more resilient than in 2008. And a lot more of the debt is VC, private credit, and sovereign wealth funds. Big, proper, banks should be ok. Smaller ones could be shaky, but they can collapse without taking the global finical system with them.

Oscar-T-Grouch

A long overdue correction. I hope a dozen VC fratards self terminate in ugly ways

drummer820

What the fuck is going on is exactly what the “bears” have been saying for 12-18 months: Useful tech, but way overvalued and surviving on high interest debt and VC money. They were just getting clowned on bc it’s impossible to nail the timing and the irrational party kept going longer than a lot of us thought possible.

greenpride32

Numbers are all relative. The $58b is substantially impactful for 99.99999% of companies out there. But AMZN is not just any company. AMZN has $578b of RPO on the books. They can easily fund the spend. Even if you were to remove the commitments from OpenAI and Anthropic (which by the way are well funded themselves), you still have hundreds of billions incoming from the world over using AWS. That's not even factoring in e-commerce and ad business. I couldn't tell if you if the current AI frontier labs will succeed or not. But they have hundred billion cash pile that is earmarked for the hyperscalers and neoclouds. Even if all of that money is not paid, a lot will be. I'd also argue that hundreds of billions of VC money went into AI startups over past 3 years. If the leading labs don't succeed no doubt there will be another company that fills their shoes. I think most agree "AI is not going away" - the matter becomes will the first movers succeed - but that is not the problem of AMZN.

RIVNMoonMe

And when I say profits I obviously mean the future bro. You don't need to remind me that right now we are just incinerating billions of dollars of VC bro. I am well aware. But the profits will come bro. Like real soon. Just need another trillion or so of VC. Promise bro.

Kandals

VC doesn't want to now based on how the market is currently taxed. Right now they make more money if 70% of investments go bankrupt, 2 do ok, and 1 is a home run because of current tax laws. Money doesn't just disappear when tax laws change - the money has to go somewhere. An obvious pivot for VC is instead of bankrupting everything in 5 years that isn't a home run they would instead fund stable companies with cash flow and quality products at a corporate tax rate of 21%. I don't want to remove capital from our economy because it can fund important inventions but I also don't approve of the volatility that such a low capital gains tax incentivizes.

v_proutek

It's a modern phenomena. We have hyperscalers, VC accelerates, looksmaxxers and other various maxxers. Everyone is trying to get an edge.

1098duc_w_the_termi

Lmao this dude using thousands in VC funded tokens for his (worthless, I mean we all know they are) side projects is peak inefficient spend and productivity destruction

Middle_Cook_7842

I'm raping opus 5.5 to finish my stupid side projects. Thanks VC.

Mission_Pirate_4150

It’s amazing what happens when engineers lead tech firms as opposed to VC guys.

McMuff9

The VC’s absolutely Love a Retail Sheep Investor like you. They are seeking to Cash Out and you’re right there ready to dive in! Your choking on their Kool-Aid. 👍

sprucenoose

I agree with you, is just that the corollary has been the huge amounts of private financing that have been directed at early stage startups, which are many multiples above the levels of all the prior IPO early stage financing. Startup financing was just not really a thing 30+ years ago. Now it is an industry into itself. There are other benefits and drawbacks from the private VC financed startup path that have come about over the years and have led to the current state of things. I think an overall question would be whether the likes of Anthropic would have been possible without it.

cogit2

So ... yes, it will happen. For companies that are cashflow positive, profitable, and have growth, shareholders expect these qualities in perpetuity. They allow for CapEx, and I think investors recognize the CapEx for AI has to be high. But still: they expect growth, cashflow, and profits for those investments. That represents a limit on what public companies can do that are already in the black - their shareholders won't allow them to see profits turn to losses for too many quarters, they expect a ROI. So which companies have ROI expectations right now? Every Mag7 in AI. Which companies don't have this worry to the same extent? OpenAI and Anthropic. This means, in a sense, that OpenAI and Anthropic have a longer window to survive CapEx and quarters in the red. Particularly as they are VC backed. This means, in a sense, they can outlast companies with shareholders who demand a ROI. There will be a shakeout - and the companies most likely to survive shakeouts are the ones with the best financial position. Not having profit expectations gives private companies an advantage. Even as Anthropic goes public, shareholders know to expect a few years in the red. That's why they and OpenAI have a bit more of a runway to burn cash and win market than the Mag7 profitable companies. You saw Google get punished last week, that's Exhibit A of a company whose investors expect profits.

Clean_Bake_2180

Because the profits come from circular financing of the frontier labs, who spend the VC and hyperscaler money on compute with the hyperscalers, who are not actually tech companies trying to make money but AGI research vehicles. The bubble is in the E.

mxmcharbonneau

Websites were relatively cheap to make if you had VC money, but yeah, few had much revenue. AI labs make a bunch of revenue, but the amount of money they must spend to have a semblance of a moat is staggering. Different issue, but I wouldn't be surprised if OpenAI and/or Anthropic go under, with big tech companies acquiring their tech for pennies on the dollar.

PalantirImperator

I've thought that we could fix a lot of the issues with "late stage capitalism" by preventing this. A law that a company cannot raise funds at a valuation in excess of, e.g., $10 billion, would allow retail investors to capture a huge portion of the growth that has been kept private in VC funds over the last 15 or so years.

sprucenoose

All of that is very well put but one point I would call out: >Early investors can still make 10x, 50x or 100x privately. Usually, for the early investors to realize those gains, they need to get to an IPO to sell on the public markets, which goes back to the point above. Also worth noting that those early investors are going to be angel investors or early growth stage VC funds that take huge risks and usually see 90-95% of their investments fail and result in a total loss. They depend on having that 1 on 20 take off and make up for all of their other losses and provide those outsized returns.

T00ManyH0bb13s

It's coming from other AI startups that are burning VC cash on tokens. Startups that don't make frontier LLMs but whose technology relies on them and they're getting sweetheart deals on tokens because no one can afford to pay the real price. It's bullshit all the way down. Most of Anthropic's revenues are from these types of companies which are themselves, unprofitable.

etempleton

Many of the apps and integrations are VC backed AI startups that are also not profitable.

NotUmbra

The users have VC money? What are you even talking about

etempleton

Most propped up with VC money that is going to start drying up here soon.

ex1stence

Brother who is “the market”? These are private banks and VC firms whose entire business model is funding companies for a return.

1995TimHortonsEclair

“Everyone is exit liquidity” is too cynical, but there's a legitimate structural criticism underneath it. The issue is that the IPO has moved later in the corporate lifecycle. Companies used to need public markets to finance a significant portion of their growth. Today huge private VC/growth-equity funds, institutional private rounds and private secondary markets allow companies to grow to huge valuations before ordinary investors ever get to buy a share. Regulation has contributed too. Public-company compliance became substantially more demanding, while laws like the JOBS Act simultaneously makee staying private easier by raising mandatory-registration thresholds and expanding private capital formation. You used to have to have sec-compliant reporting even if you weren't public just because you had employee shares, and they figured they might as well go public anyways. So the criticism is around the fact that we've entirely privatized the early-growth phase and publicized the mature phase. Early investors can still make 10x, 50x or 100x privately. Then the public is offered the company after much of that explosive repricing has already occurred. That doesn't mean there is no upside left, but the distribution of that upside has changed. It doesn't take a genius to understand the incentives along with human nature to see that this can also set up an "offloading the bags" scenario.

Powerful_Inspector_0

**Exactly When a VC or a billionaire wants to realize their 500% gain, they need someone on the other side of the trade That someone is you. You’re not 'buying the dip you re just providing the exit door for early investors**

Original-Poet1825

It’s not really flatlining, but I think software as a field does not have as much market to take as a year ago. Right now most, if not all, advanced usage is coming from SWE and their companies. They need to expand beyond it if they want to meet this valuation. OR they can try to increase the price on SWEs but realistically most not VC backed startups are already sus about how much this impacts their products and aren’t going to pay absorbent costs unless they can safely lay off staff in replacement

Syllabub_Visual

If Miami feels like utopia, then tell me why everyone loves to shit on this city? You have YEAR ROUND warm weather, hot chicks who show their arms and legs, all the tech bros and VC’s, world class restaurants and amenities and housing, world class nightlife, LOTS of money down here and access to opportunity, beaches, and so much more that I’m probably forgetting. What’s not to like, or should I say LOVE?

Syllabub_Visual

Honestly RDDT is probably gonna be on the pink sheets soon. This company has literally zero value and it’s the VC’s who love to pretend everything is about credentials who made this happen.

Visceral99

I was alive. You seem ill-informed. The overwhelming majority of capex in tech, as well as global VC, has been going "all in'' in AI for 2 years now.

Syllabub_Visual

It’s the SUNSHINE state. We have Ken griffin, Bezos, and now even zuck. Oh and all the VC’s left sf to come here and we got all the hot bikini babes. Almost feels like a utopia.

Syllabub_Visual

I never ever ever thought I would ever say this, but today I can officially and proudly proclaim that I have joined MAGA. Look I was your typical leftist for a long time even though I started to become much more right leaning on economics and a proponent of classical liberalism while still hating orange and the movement as a whole. But things have changed. The dems have absolutely lost their minds and I can’t even align with them socially anymore. And I’m not alone, we now have Elon, fetterman (it will happen), Nicki Minaj, and now Mohamed’s rival, all former leftists. Plus all the VC’s and hot chicks in Miami are MAGA so who else do I even need. That’s why I am feeling more bullish than ever because we have a great prez who actually believes in innovation and is gonna send the markets up. Still I’ll concede that dems are PROBABLY gonna win next week and the markets will fall 10%, but I’m still more bullish than ever.

version-two

This is a retarded comparison. I’d prefer congress not be able to trade, but her husband is literally a lifelong investment/hedge fund/VC guy and an actual insider. We’re talking about the prez making 32k trades in \~2yrs, front running and moving markets at his discretion. This is asinine.

cogit2

VC is running out: they're about to land their largest funding round with this IPO Profit scales linearly with revenue: but also scales variably with the quality of their products, and they are definitely seeking to add and expand the number of products they provide Lack of margin and moat: again, i know companies that have been in the red and had no real moat that have been around for 15 years. You need to take a closer look at the history of "growth at any cost" companies and understand this model. "they’re a scrappy startup in an arms race" The biggest arms race we are likely to see in our time and Anthropic is less than six years old. That's definitely a startup in a market that only really broke out in 2023.

Own-Recipe5908

To what? Starlink is just more satellite, which has existed. Sure it has value but it has costs, and is competing with telecoms that already exist and cover most areas, should SPCX be valued like those telecoms it would have to go down in price. Biggest novel use is military, which they've shown the world cannot be trusted by flicking a switch on a billionaire's whims, so now Europe is moving up their own plans for a constellation. Tsla existed before Musk bought them. Their business would not have even reached the point where they're comparable to a shitty car company without massive government subsidies. The government built tsla, Musk just financially engineered VC money into it.

Realistic-Cheetah413

Profitability isn’t the point and VC is already running out, and can’t support a company that already owns almost all of its market and needs to increase its annual profit by almost $100B with a product that scales profit linearly with revenue. The lack if margin and moat is what will kill this company, and at this scale they can’t afford to kick the can down the road. They most likely will need to take out debt to pay the bills coming up and then they have interest to worry about. Having almost a trillion dollars in contractual obligations and convincing several multi trillion dollar companies to go cash flow negative to build your infra doesn’t warrant the excuse of “they’re a scrappy startup in an arms race”. They can’t afford to fail.

SEC_intern_

Frontier revenue is driven by top 1% spenders, which are only burning VC cash. Circular financing in a nutshell. https://preview.redd.it/od1jjrlryxyh1.png?width=1812&format=png&auto=webp&s=a141efe4493fbb290f42ab1b1bb7dadfb88cb2c2

lord_braleigh

I have heard of VCs and subsidies, but you're engaging in a thought-terminating cliché by just writing "VC subsidies" and leaving it at that. To be more precise: if you use a million output tokens of Opus 5.5 and pay the $20 / MTok rate, what do you actually think the cost was to Anthropic, and how did that cost get there? If the cost was in electricity, how much electricity must you have used? What's the power draw of the largest Nvidia GPU, how fast did you get your answer, and what happens when you multiply? Reddit will not do this math for you!

Reaper_1492

😂 that’s not how this works. Sector rotation doesn’t leave money on the sidelines for a month. Anthropic is going to implode when they IPO. This is an exit liquidity move of epic proportions. Insiders and VC have unlocked shares from the day it IPOs, with accelerated lockup there after. This is a horrible market for AI to be IPOing in. But money is drying up, and they don’t have a choice but to try and convince the public they need to fund their negative cash flow through dilutive offerings. This is all bad.

nohandsfootball

It's like you've never heard of VC subsidies

Super-Activity-4675

Do you realize how much of that growth is compute spend for OpenAI and Anthropic? What do you think happens when those companies fail? Here's another fun fact, both OpenAI and Anthropic have huge concentration risks as most of their business comes from AI startups dependent on VC money. Look, I'm in this industry for a living, which included 10 years at MSFT in technical roles. The tech will never accomplish what it is promising, and you and I will end up suffering the most.

Juhyo

It’s relatively affordable now, wait till they jack up subscription fees. Netflix, Spotify — everyone did it. They will too once they run out of VC funding to subsidize it and shareholders demand returns.

Syllabub_Visual

Remember that the gop wanted to get rid of audits for people making under 400k a year and the dems said no AND they want to peak into the pocketbooks of people transferring $600 on Venmo? Now they want to do it again but just with Mohamed from the brotherhood this time? That’s all the evidence you need. The markets are gonna crash because of all the regulations they want to impose and it will be impossible to do anything anymore, so if you want nvda to continue to soar under the most pro business and pro innovation and pro Israel prez in history (and the Israel thing matters because the radicals whom number 2.1 billion seek to destroy it), vote gop and your ports will be happy… PLUS all the VC’s and hot chicks in Miami agree with me so what more proof do I need?

cogit2

"So they are not profitable and have an average of at least $100B of set expenses coming up each year. Yeah good luck." Should a 4-year old startup in a massive arms race be profitable right now? I know companies that haven't turned a profit in 15 years under VC backing. Profit isn't the point. Conquering the market is. This is quite literally the Sand Hill VC playbook they are following, and this is practiced very widely in VC-funded startups. There is a method to the madness, and there is a path to profitability, it's just that if you don't know the game being played you won't realize what it is from the financials alone.

njaanlearnen

Many more to go. Once the pump & dump scheme has fulfilled its duties for the VC & the rest of the big money.

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.