alt Hacker NewsHigh growth companies often have significant negative cashflow during the early high growth era, followed by positive cashflow in the years later down the line.
This phenomenon is known as the J-curve[1], and Uber is a good example of how this can turn out absolutely fine. To some extent, the entire Venture Capital industry exists to finance precisely this dynamic!
Nb. I'm not suggesting OpenAI is fairly valued, or that they will definitely become profitable, but "OpenAI is losing billions of dollars" doesn't really mean anything in and of itself.
[1] https://www.uark.vc/blog/breaking-down-the-j-curve-the-journ... (many other similar such articles exist)
> High growth companies often have significant negative cashflow during the early high growth era, followed by positive cashflow in the years later down the line.
Uber is the antithesis of OpenAI, it’s not a good example. Uber was burning money on acquiring customers. OpenAI is burning money to provide their service (and the R&D they need to continue to have valuable models). They cannot just stop and turn profitable like Uber. The money they burn isn’t invested, it won’t yield a multiple of revenue in the future. It’s consumed for compute and that’s it loo