At this point IPOs are mainly for unloading bags onto retail. Every institution who wanted a piece of these labs got in years ago and captured all the value.
Well, sad to say this is simply untrue for a few reasons.
1. "Retail" does not have enough purchasing power to have all of these "bags" unloaded on to.
2. Institutions buy shares in public firms post-IPO all the time even when they're "unloading bags onto retail". Take Uber (random example) ~83% is owned by institutions.
3. General factual history of the stock market shows that you are incorrect. Successful companies that IPO and continue to do business still have quite a lot of room left to grow. What was Google's market capitalization at IPO? What is it now? Is it possible some early investors made higher multiples than the IPO -> May 20th valuation? Yea for sure. That doesn't mean that all the value was captured. It also doesn't take into account the early stage risk for investing. Is Google an "at this point IPO"? No, but the principle is the same.
It's also worth mentioning however that the number of IPOs is going down over time. You could maybe argue that the only ones that actually IPO are all the bags, but that seems like a stretch.
These cynical comments "IPOs are mainly for unloading bags on to retail" lack explanatory power and data.
It depends at least partially on how much they're going to float. I think SpaceX is only planning about a 4% float, so even at $1.5T they only need around $60B. Which is a drop in the bucket.
EDIT - but that's just the IPO, I wasn't even thinking about how much insiders will want to sell after the lockup ends...
Agree, deeply interested in their books and then whatever report cadence we end up on next year.
I understand that a lot of people want to cash out, but I'm surprised they're ready to share, especially given I don't think they've had issues bringing in funding in the private markets, but maybe I'm wrong.
Throughout the “AI bubble” talk in 2024 and 2025, I consistently argued that we were nowhere near the peak of the AI bubble. So far, that view has held up, as valuations are significantly higher today than they were in 2024 and 2025.
If you look at the way the dotcom bubble unfolded, dotcom didn't take off until after Netscape IPOed in 1995. The market had 5 more years of growth until the collapse. And even after collapse, the Nasdaq was 2x higher post pop than in 1995.
If history repeats itself, the stock market will take off after OpenAI and/or Anthropic IPOs. Be scared when random AI companies IPO with bad ideas and no revenue.
Companies IPO'd at an earlier stage of development in the days before Sarbanes-Oxley. Netscape was a 16-month-old startup when it IPO'd. It had about 250 employees. It had raised a total $27M in venture capital then, and then raised a few hundred million in the IPO itself, which gave it a total valuation of $2.9B. It had $16M in revenue and no earnings.
OpenAI is 10 years old. It has about 4500 employees. It's raised about $180B in capital, and has a valuation of roughly $900B on about $25B in revenue. Anthropic is 5 years old. It also has around 3000-5000 employees. It will have raised about $120-140B in capital, at a $900B valuation, on about $30-45B in revenue.
In the 80s and 90s companies IPO'd to actually raise growth capital - the public markets provided the money they needed to invest and expand. In the 2010s and 2020s companies grow with private capital, which has fewer strings attached, and then they unload the shares on the public market when they reach the top of their growth curve, leaving the public holding the bag.
If someone comes in and points out a bunch of valid similarities, are you going to start being nice, or are you just going to call that person's ideas stupid too?
Yup, Sam can claim that AGI is owned by everyone (he really means their pension funds though), while he makes a hasty exit to his private island retreat which we all have paid for.
Well, I guess that's an effective way to deflect responsibility for the harms they cause from the people actually in control of their software and databases, onto 'shareholders'.
Agreed. They should IPO first if they think Anthropic’s IPO will be bigger. Get as much capital as you can first, then use it to buy more compute and defensively.
The hype will be a lot less if Anthropic IPOs first and beats OpenAI’s numbers.
At this point IPOs are mainly for unloading bags onto retail. Every institution who wanted a piece of these labs got in years ago and captured all the value.
Wise comment. 25 years working in PE showed me that retail investors are how you pay off losses.
Well, sad to say this is simply untrue for a few reasons.
1. "Retail" does not have enough purchasing power to have all of these "bags" unloaded on to.
2. Institutions buy shares in public firms post-IPO all the time even when they're "unloading bags onto retail". Take Uber (random example) ~83% is owned by institutions.
3. General factual history of the stock market shows that you are incorrect. Successful companies that IPO and continue to do business still have quite a lot of room left to grow. What was Google's market capitalization at IPO? What is it now? Is it possible some early investors made higher multiples than the IPO -> May 20th valuation? Yea for sure. That doesn't mean that all the value was captured. It also doesn't take into account the early stage risk for investing. Is Google an "at this point IPO"? No, but the principle is the same.
It's also worth mentioning however that the number of IPOs is going down over time. You could maybe argue that the only ones that actually IPO are all the bags, but that seems like a stretch.
These cynical comments "IPOs are mainly for unloading bags on to retail" lack explanatory power and data.
Let's hope—and I say this with zero sarcasm—that their relationship to Wall Street is cruel indifference.
The summer of Trillion dollar IPO’s is upon us. OpenAI, Anthropic, SpaceX
Will they eat each others potential capital appetite? Or is there just that much laying around for them all to gobble up the bag?
It depends at least partially on how much they're going to float. I think SpaceX is only planning about a 4% float, so even at $1.5T they only need around $60B. Which is a drop in the bucket.
EDIT - but that's just the IPO, I wasn't even thinking about how much insiders will want to sell after the lockup ends...
Is 100+ FPE the new normal?
Can't wait to see those revenue numbers.
I’m less interested in revenue and more interested in their operational costs
OpenAI reported ~$20 billion annualized revenue for 2025, up from $6 billion the year before.
And that covers their model training and infrastructure costs?
each new model brings in revenue that is multiple times the cost to create said model
Is that the case? What about gpt 4.5? o1-pro?
So their CFO's publicly voiced concerns are unwarranted?
exactly
Agree, deeply interested in their books and then whatever report cadence we end up on next year.
I understand that a lot of people want to cash out, but I'm surprised they're ready to share, especially given I don't think they've had issues bringing in funding in the private markets, but maybe I'm wrong.
Throughout the “AI bubble” talk in 2024 and 2025, I consistently argued that we were nowhere near the peak of the AI bubble. So far, that view has held up, as valuations are significantly higher today than they were in 2024 and 2025.
If you look at the way the dotcom bubble unfolded, dotcom didn't take off until after Netscape IPOed in 1995. The market had 5 more years of growth until the collapse. And even after collapse, the Nasdaq was 2x higher post pop than in 1995.
If history repeats itself, the stock market will take off after OpenAI and/or Anthropic IPOs. Be scared when random AI companies IPO with bad ideas and no revenue.
My posts on AI bubble over the years:
* https://news.ycombinator.com/item?id=40739829
* https://news.ycombinator.com/item?id=43385830
* https://news.ycombinator.com/item?id=47035647
* https://news.ycombinator.com/item?id=46241944
Companies IPO'd at an earlier stage of development in the days before Sarbanes-Oxley. Netscape was a 16-month-old startup when it IPO'd. It had about 250 employees. It had raised a total $27M in venture capital then, and then raised a few hundred million in the IPO itself, which gave it a total valuation of $2.9B. It had $16M in revenue and no earnings.
OpenAI is 10 years old. It has about 4500 employees. It's raised about $180B in capital, and has a valuation of roughly $900B on about $25B in revenue. Anthropic is 5 years old. It also has around 3000-5000 employees. It will have raised about $120-140B in capital, at a $900B valuation, on about $30-45B in revenue.
In the 80s and 90s companies IPO'd to actually raise growth capital - the public markets provided the money they needed to invest and expand. In the 2010s and 2020s companies grow with private capital, which has fewer strings attached, and then they unload the shares on the public market when they reach the top of their growth curve, leaving the public holding the bag.
These backward comparisons are incredibly stupid.
They are not very comparable - go list out the characteristics for it to be a viable comparison.
What even is this post? Desperate for validation? LMAO
If someone comes in and points out a bunch of valid similarities, are you going to start being nice, or are you just going to call that person's ideas stupid too?
Congrats to OpenAI and RIP to the SF housing market
Are they trying to beat SpaceX as well?
Say OpenAI IPO 5 times fast
The "I" in "AGI" stands for IPO.
So as we can clearly observe: "AGI" which at this point is (A Giant IPO) is almost here.
Now all of humanity will benefit from this being e̶x̶i̶t̶ ̶l̶i̶q̶u̶i̶d̶i̶t̶y̶ shared by everyone for everyone. Right?
Yup, Sam can claim that AGI is owned by everyone (he really means their pension funds though), while he makes a hasty exit to his private island retreat which we all have paid for.
Well, I guess that's an effective way to deflect responsibility for the harms they cause from the people actually in control of their software and databases, onto 'shareholders'.
Smart move IPO'ing ahead of Anthropic. Can take a lot of AI capital being first mover... That is, until Anthropic IPO's which I expect shortly.
Agreed. They should IPO first if they think Anthropic’s IPO will be bigger. Get as much capital as you can first, then use it to buy more compute and defensively.
The hype will be a lot less if Anthropic IPOs first and beats OpenAI’s numbers.
I'll believe it when I see it.
Anthropic or OpenAI IPOing is literally signing their own death certificate.
The valuation will go to zero as soon as they have to submit actual numbers instead of the salad of bullshit they usually serve investors.
Good luck with that I guess
It will probably be a failure, that is why they are rushing it to prevent a greater failure.
Microslop and Oracle are already way down from their highs. Only Nvidia as the shovel seller still performs well.
People generally hate AI. The IPO price will be inflated and the stock will drop 10% on the first day, like many late stage IPOs in the 2000 bubble.
Friends and family like the Kushners will cash out. Trump might even suspend wars around the IPO date.
Any early guesses on end of first day market cap?
I'm going to guess $2.5 trillion which is about 2.5x their current valuation. I think the hype is going to be immense.