The next phase of the AI race is on.
With OpenAI’s Monday confidential S-1 filing following in the footsteps of Antrhopic’s, the two premiere AI labs are now officially in the IPO race. SpaceX, which includes Elon Musk’s xAI, has a head start, and goes public later this week.
While OpenAI left the door open on its timing, warning that “it may be a while” before it actually publicly lists its shares, the AI labs are moving from an era of closed-door tinkering as a private companies into the world of public earnings calls, financial disclosures, and the regulation that comes with being a publicly traded company.
Is it a telling signal of just how much cash they’re all burning? A chance to reward loyal employees who hold shares and help retain key AI talent? Something else?
Here’s what smart voices across Wall Street, tech, and the wider business world make of the ChatGPT maker’s latest move:
Aravind Srinivas, CEO of Perplexity
Perplexity CEO Aravind Srinivas said his AI company is still targeting 2028 for its IPO.
“Agnostic of these two companies, we were planning for something in 2028, so that still remains the case,” Srinivas told CNBC.
Srinivas said how OpenAI, Anthropic, and SpaceX’s IPOs fare will matter to the broader industry.
“I certainly think there will be ripple effects if they don’t go well, like there is no sugar coating on that,” he said.
Dan Ives, tech analyst at Wedbush Securities
Wedbush analyst Dan Ives said OpenAI’s filing shows “the floodgates for the IPO market are officially open.”
“While both OpenAI and Anthropic have recently raised significant amounts of capital, both are racing to get to market as quickly as possible to beat one another out due to the significant amount of capital both firms are looking to raise,” Ives wrote in a note.
Ives said OpenAI CEO Sam Altman “continues to face competitive pressures from competitors like Anthropic to show that growth continues to accelerate and will maintain its current aggressive pace through the next decade.”
Dan Niles, founder and portfolio manager at Niles Investment Management
Dan Niles said he views Anthropic more favorably than OpenAI.
“I think Google wins in consumer, they have the complete stack,” the portfolio manager told CNBC. “I think they win in AI overall, but then in corporate, you have Anthropic.”
Niles said that Anthropic reached profitability in Q2 “and their revenues are ramping like nothing you’ve ever seen in history for a company of that size.”
“I think OpenAI is stuck between the two,” he said. “So for me, those are the two winners.”
Michael Fertik, founder of Verdict Capital
Michael Fertik, founder of Verdict Capital, said he hopes SpaceX’s IPO on Friday opens the door “to a gushing torrent of liquidity.”
“I’m rooting for Elon Musk. I’m rooting for the IPOs. I’m rooting for the OpenAIs and Anthropics,” Fertik told CNBC.
Fertik said that companies debuting strongly would help the US stay ahead in the generative AI race. He also said that many companies have been relying on private markets for so long that it’s time for retail investors to share in the AI moment.
“I hope that it does encourage companies that have been getting ready to file, to file,” he said of SpaceX’s debut.
Gregory Allen, founder and CEO of Decision Tree Research
Gregory Allen, CEO of Decision Tree Research, said OpenAI’s valuations, along with those of SpaceX and Anthropic, are really extraordinary.
“These companies are in the ballpark of a trillion dollars valuation,” Allen told CNBC, adding that in annuity terms, that is akin to “an annuity that kicks out $45 billion a year every year forever.”
Allen said even though companies like OpenAI are going to lose money this year, “the gross margins in these businesses are extremely favorable.”
“The question is, can they time the investments correctly, to make these, hundreds of billions of dollars in capital expenditure investments and ride the wave of revenue growth properly, such that they don’t run out of cash and go bankrupt, which is the big risk here,” he said.
Gary Marcus, AI researcher and professor emeritus at New York University
Gary Marcus, an AI researcher and author known for his critical views of the AI industry, suggested buyers should be aware of where the AI industry stands.
“i used to be the only person saying the emperor was wearing no clothes,” Marcus wrote on X, quoting a tweet about SpaceX’s valuation. “those days are over. the only people buying SpaceX and OpenAI at list price will be the stragglers who still can’t see it.”
Nate Elliott, principal analyst at EMARKETER
OpenAI “is filing to go public at a precarious moment,” said Nate Elliott, a principal analyst at EMARKETER, a sister company to Business Insider.
“The company is just about to lose its strong early leads in both consumer and enterprise AI,” Elliott wrote in an email to BI. “Anthropic has generated incredible momentum in the enterprise market, and EMARKETER forecasts that Google will overtake ChatGPT in terms of US AI users by early 2027.”
Elliott said OpenAI “doesn’t have a lot of other places to look for the enormous capital required to support its costs.”
“The company has taken almost $200 billion in funding across more than a dozen private rounds,” he wrote. “It certainly can’t count on its consumer business becoming self-sufficient anytime soon.”
Joshua Achiam, OpenAI’s chief futurist
It wouldn’t be a full OpenAI news cycle without someone taking a shot at Anthropic.
Joshua Achiam, OpenAI’s chief futurist, framed the discussion as a choice between two very different goals of the now rival companies.
“Should a loving ensouled machine God watch over humanity? Vote Anthropic,” he wrote on X. “Should humanity be entrusted with the tools of its own progress and destiny? Vote OpenAI.”
Achiam dismissed the analysis that focuses on the differences between the two leading AI companies’ business models.
“If your lens for analyzing this is ‘consumer v enterprise business’ your ability to understand what’s going on is unfixably borked,” he wrote.
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