OpenAI, a non-profit AI company that will lose anywhere from $4 billion to $5 billion this year, will at some point in the next six or so months convert into a for-profit AI company, at which point it will continue to lose money in exactly the same way. Shortly after this news broke, Chief Technology Officer Mira Murati resigned, followed by Chief Research Officer Bob McGrew and VP of Research, Post Training Barret Zoph, leaving OpenAI with exactly three of its eleven cofounders remaining.
This coincides suspiciously with OpenAI’s increasingly-absurd fundraising efforts, where (as I predicted in late July) OpenAI has raised the largest venture-backed fundraise of all time $6.6 billion— at a valuation of $157 billion.
Microsoft and Nvidia are investing but they are both positioned to gain a return on investment by cloud hosting and hardware sales respectively.
Apple dropping out indicates they saw behind the curtain, did the math and realized they can create their own platform for less.
There is no path to profitability for them. Unlike other recent billion dollar tech companies there are no human workers to squeeze. Hardware doesn’t work for less than minimum wattage.