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Comment by bdangubic | Hacker News Reader

not that I disagree but would it be fair to say though that we have seen this before where it turned out OK? say Uber? Amazon?

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IIRC, current estimates are that OpenAI is losing as much money a year as Uber or Amazon lost in their entire lifetime of unprofitability. Also, both Uber and Amazon spent their unprofitable years having a clear roadmap to profitability. OpenAI's roadmap to profitability is "???"

I have lived through Amazon’s rags to riches and there was never a clear plan to profitability. Vast majority of people were questioning sanity of anyone investing in Amazon.

I am not saying OpenAI is Amazon but am saying I have seen this before where masses are going “oh business is bad, losses are huge, where is path to profitability…”

Your recollection is hazy. Bezos chose not to be profitable in order to grow the company, and reap greater rewards in the future. https://www.youtube.com/shorts/wjLs22dNOCE

I don't know either way but every company does this, it's not saying anything meaningful to say that a new company is taking an "investment year" or two or ten.

I do know that in the late aughts, people were writing stories about how Amazon was a charity run on behalf of the American consumer by the finance industry.

and those stories were in the short run correct, since Amazon and Uber succeeded by massively undercutting existing businesses. reel customers in with charity, then turn the screws. what business is ChatGPT undercutting?

all of them :)

sounds like snake oil to me :)

To become the next Uber, do I just need to run huge losses?

I wouldn’t but path to success can clearly come from running 10-digit losses for a loooong time, no?

I think you're saying that just running up huge losses is sufficient to create a successful company? But that you personally wouldn't want to run up huge losses? Not sure.

nah, I am saying that many (super) successful businesses ran in red financially for a very long time. I would not run a business that way but I am also (fortunately) not a CEO of a multibillion dollar company

To my knowledge Amazon never debt financed their ops like this

Amazon did borrow money, for a long time.

Where did their financing come from then?

They had a cash-cow called AWS to keep the retail business afloat

not right away

Somebody must not be old enough to remember Amazon before AWS. Maybe you also don’t remember that Amazon started selling books before becoming the world’s largest fencing for selling stolen merch. They used to be the butt of many jokes for losing so much money for so many years while they expanded warehouses.

Amazon paid no dividends, that's their big debt financing.

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