alt Hacker News> 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
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> They cannot just stop and turn profitable like Uber.
Of course they can. They could just stop training new models and milk the existing ones. A billion users check in ChatGPT weekly. Software developers wouldn't stop using Codex.
OpenAI is not unlike any other startups who try to build their marketshare early on. No matter how much money they lose, they would be fine as long as they could raise more money than they spend. Uber is exactly the same. HN during 2015-2020 were full of comments predicting Uber's demise.
If the leaked data is to be believed, OpenAI is spending 40% of revenue on sales and marketing, which is not the OPEX profile of a product-led technology company
Broadly speaking, companies that spend 40%+ of revenue on sales and marketing end up being a bit of a drag on society. Eg. Salesforce’ product quality is far lower than winners in other sectors that sit closer to 10-15% of revenue on sales and marketing
Maybe - just as how the city of Sao Paolo implemented a ban on billboards - we can implement a law where a 3 year rolling average of sales and marketing spend cannot exceed 20% of revenue in that period