I’m gonna make it profitable for REAL this time, bro, I swear! I realise that there are more entertaining clown shows happening at the moment, but so far during the Betwixtmas period, I’ve mostly been paying attention to the pressure building inside the GenAI bubble. Some picky bits for you all to graze on:
Yesterday, according to CNBC, OpenAI published a statement on its website with more detail about its controversial intention to transition from a non-profit organisation to a for-profit public benefit corporation (PBC) in 2025. The post admits that this transition will require “more capital than we’d imagined.”
Mmhm. (OpenAI is currently valued at $157 billion, and raised $6.6 billion in October.)
“OpenAI expects about $5 billion in losses on $3.7 billion in revenue this year, CNBC confirmed in September. Those numbers are increasing rapidly.
By transforming into a Delaware PBC ‘with ordinary shares of stock,’ OpenAI says it can pursue commercial operations, while separately hiring a staff for its nonprofit arm and allowing that wing to take on charitable activities in health care, education and science.
The nonprofit will have a ‘significant interest’ in the PBC ‘at a fair valuation determined by independent financial advisors,’ OpenAI wrote.”
Sure this seems unsustainable but keep in mind the massive losses today are positioning them for much bigger losses tomorrow.
— A.R. Moxon, Bluesky Elderberry (@juliusgoat.bsky.social) December 28, 2024 at 11:47 AM
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The staggering gap between incomings and outgoings isn’t the only thing at issue, obviously. OpenAI has bled top talent in recent months, with one former exec quoted in the CNBC article above saying that “safety culture and processes have taken a backseat to shiny products.” OpenAI is also embroiled in on-again, off-again lawsuits brought against it by Elon Musk, who wants to stop the company’s transition to a for-profit model. It’s also being sued by a consortium of U.S. news publishers, Canadian news publishers, the Intercept, a major Indian news agency, and the comedian Sarah Silverman, among many others. (You can see a running list here.)
But wait! There’s more.
Just a Little More Capital, Bro, Just a Few More BillionPost + Comments (85)


