Confidential submission of draft S-1 to the SEC

I think the more companies there are, the better. Having 3 top labs competing, with 2 more trailing is better for consumers than having a monopoly/duopoly in goog or goog vs. the world. There'll be pressure on innovation, cost, availability and so on.

Many people thought Google+ would stomp all over Facebook, and that GCP would kill Azure and AWS for most of the same reasons.

Consolidation is inevitable, so let’s lean in and ensure society, not shareholders, reap those benefits.

It's the other way around (but the result would be the same): Alphabet has no need to make a 100x exit for the investors, and so can offer the service at cost + %markup, while Anthropic and OpenAI are VC funded, meaning that they need to show 10x - 100x exit for the investors.

IOW, there is no moat, Alphabet would have market-related pricing while VC-backed corps cannot offer market-related pricing.

How's that talent been working out for them the last few years?

The scary thing for google is if the AI companies start moving into ad targeting and open sales portals.

You might as well say the same about GCP vs AWS. At the end of the day, in spite of how much superior engineering prowess it has, Google still treats its customers like it views them as a steaming, fly-covered pile of crap. This reflects just as much in Gemini as in their other products; after their initial competitive Gemini 2.5 Pro release, they just kept dumbing it down and reducing quality of service while charging the the same amount, trying to pull a bait-and-switch, and with their latest Gemini Flash release they're charging customers even more for a worse product. No amount of engineering or hardware can overcome such a customer-hostile corporate culture.

[1] https://www.sec.gov/newsroom/press-releases/2026-42-sec-prop...

[2] https://www.sec.gov/rules-regulations/2026/05/s7-2026-15

[3] https://www.sec.gov/files/rules/proposed/2026/33-11414.pdf

I think that’s the thought process and why they’re in such a rush. In fact all three are in a sort of race, you probably don’t want to be the last one to IPO

They don't really have a choice - there is a finite amount of money in the open market, and the first one to IPO is going to get the lion's share of that money.

Perhaps Larry Ellison can cut them a nice quid pro quo for a few months to make OpenAI look profitable (like the SpaceX/Anthropic deal), although that's probably unlikely given the debt Oracle is taking on to build it's infra.

Cursor is purportedly a huge customer of OAI, maybe a top five? I think Elon bought it to have leverage on sama.

If timed correctly, Elon could pull the plug on a huge customer (Cursor) the quarter before OAI try to IPO.

Elon is 100% a for profit person, it's just a 10 year rivalry between Sam and Elon.

What is your disposition to OpenAI?

  The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities — that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future — will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands.

Which market? The stock market? Or the tech stocks? Or something else?

https://www.notus.org/technology/trump-blindsided-ai-compani...

OpenAI CEO Sam Altman pitched the idea of turning over shares in his company to Trump in early 2025 and discussed the matter again with senior officials in recent weeks

Once the SEC declares a registration statement "effective," the company is subject to the Exchange Act's reporting requirements. Theoretically one can do this and not list one's shares. That's dumb, so nobody does it.

In practice, we'll get a couple weeks to possibly days ahead of the listing. That process is partly governed by the SEC accepting the company's S-1. It's mostly down to negotiations between the company, its underwriters and IPO investors.

The point he makes is that companies go public when they think they can get the maximum our of their shares on the retail market. Which make sense I guess.

But the fact that the 3 of them are hitting the public market at the same time means they all came to the conclusion that now is the perfect time to unload those shares. Probably because they know there is a high chance of a big crash coming after.

I will not touch those IPOs with a 10 feet long pole. But unfortunately a lot of people are about to get burned.

My prediction is that this is what will be remembered as the last bit of exuberance before everything starts to unravel.

Books will be written about how insiders will be profiting millions by unloading those shares to the greatest fools and middle class america.

One of the more rational ideas I have seen of any kind of divination is that it provides a means of passing judgement over to a near seemingly random system. If you are reading tea leaves, doing an 'I Ching' divination, biobliomancy etc. that essentially provides a coin flip to make you go 'yes' or 'no' to an opportunity.

(I mean, I think this looks incredibly like a bubble too, but for completeness sake, that's the counterexample I can think of.)

It's also similar to 2024 when HN was sure that AI is a bubble.

Similar to 2025 when HN commentators were sure that AI is a bubble.

1000% gains later, HN will continue to identify patterns of 2000/2008 and are absolutely convinced it is a bubble

Note: If a company gains 1000% and loses 50%, you can't claim you were right.

Both OpenAI and Anthropic have already gained 1000% since 2023 (In Anthropic's case almost 10,000%)

Having said that, it’s the company I have least faith in due to the recent acquisition of xAI / Twitter.

Is there a chart, somewhere, like a family tree, of what the Apple and Microsoft stock "ordinary millionaires" went on to do?

(Actually the subsidiary is everything and the nonprofit is a do-nothing fig leaf but the IRS and Congress seem to not care enough to stop them.)

1) In order to fund research - this stuff costs 10s of billions of dollars - everyone, from Ilya, to Elon, to Sam - all agreed that they would require a profit-arm to raise money. Nobody was going to sponsor that 10s of billions of dollars to a non-profit.

2) The non profit is still there - and controls the commercial element.

The for-profit (OpenAI Group PBC) is what's filing the S-1 Draft.

The OpenAI Foundation also exclusively appoints the board of the OpenAI Group PBC and can replace directors at any time.

https://openai.com/our-structure/

(I work at OpenAI, but I am not a lawyer and am not speaking on behalf of OpenAI - just sharing my personal understanding.)

The corporation selling shares is subject to normal corporate tax regime

The real answer to your question is that non profits can own shares, and there is no legal difference between passive investment of other publicly traded companies and highly consolidated shares of a private company. In the US it is seen as merely happenstance that we have such a liquid market where the shares themselves can rapidly change in value and create profits, but there is nothing controversial about that.

if you have a 'moat' then you wouldn't worry about releasing a draft S1. I assume OpenAI has neither.

“Under the JOBS Act, it has been possible since April 2012 for ‘emerging growth companies’ to file a Form S-1 on a confidential basis, only making the contents public 21 days prior to the road show for the IPO” [1]. Since 2017 and 2025 it’s been available to basically all companies [2].

Withdrawing an IPO looks bad. Confidential filing lets issuers start and have the option to abort the process without taking reputational damage. (The specifics of OpenAI’s filing, and any back and forth with the SEC, remains confidential.)

[1] https://en.wikipedia.org/wiki/Form_S-1

[2] https://www.sec.gov/about/divisions-offices/division-corpora...

Once it no longer is being drafted—and agreed upon by all parties to meet the needed regulatory standards—it will become final and be publicly published.

So a simple valuation would be something like Current Cash + Assets + Expected Future cash - (Expenses + Risk)

your suggestion makes no sense